Democratic Victory in US Senate would help efforts in Cannabis Legislation

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Reports have indicated that Georgia’s voters delivered a Democrat majority to the Senate, in spite of the chaos this past week with the mob storming the Capitol. It clearly indicates that cannabis legislation (repeatedly stalled by the Republican-held Senate) can now advance. Point to be noted that Georgia had no legalization efforts on its ballot, but the state has given the industry a big green light, so positive moves are expected out of cannabis stocks. The CEO and Co-founder of Cresco Labs (CRLBF), Charlie Bachtell said, “This is another big win for cannabis-although legalization was not on the ballot in Georgia, with a Democratic majority in the Senate we’re likely to see support for cannabis decriminalization which could have an immediate impact on expungement, lessening the burden on the US justice system”.

Bachtell added, “The passage of meaningful banking legislation like the SAFE Act would allow cannabis businesses to operate with the same access to capital and financial services as everyone else, accelerating industry growth and creating hundreds of thousands of good-paying jobs and tax revenue”. The Chief of Staff of cannabis consulting firm Gateway Proven Strategies, Derek Porter said, “The election and any government chaos can always have silver linings. The first advantage we’ve seen thus far is the principal sponsor behind the MORE Act being Kamala Harris, who is now going to be our new Vice President. Thus, having more power behind the bill that has passed the House”. It is noteworthy that there are literally hundreds of cannabis stocks trading on the exchanges in the US and Canada.

Moreover, there are big discrepancies between the solid companies and the ones barely hanging on. Investors may want to pursue ETF’s to start as they begin investing in the industry. However, the focus needs to be on US companies. The ETF’s predominantly invested in Canada won’t have the same return as the market is learning its limitations on growth. The Managing Director at THCX, Matt Markiewicz said, “I expect increased investor interest in cannabis stocks to start the new year. However, I would not be surprised to see some of that enthusiasm wane as we head into late February especially if the incoming administration isn’t explicit in their intentions around legalization or at the least decriminalization. As long as space doesn’t materially weaken in the first quarter, we may see increased capital markets activity which could bring a fresh batch of institutional investors into the mix”.