We continue to get solid signals from the Trump administration that cannabis rescheduling is on track.
This makes cannabis stocks a buy ahead of a potentially big move up in these names on actual rescheduling news.
Before we get to the most recent positive signals from the administration on rescheduling, here’s the backdrop.
Rescheduling 101
Back in late December, President Donald Trump surprised conservatives by ordering Attorney General Pam Bondi to reschedule cannabis. Trump believes cannabis has medical benefits, and he also needs the swing and youth votes in the upcoming midterms.
Rescheduling would really help cannabis companies since it would neutralize an IRS rule that blocks the deduction of operating expenses against revenue from the sale of drugs in Schedule I of the Controlled Substances Act. Rescheduling would move cannabis to Schedule III.
Trump told Bondi to act expeditiously. Now it’s been two months, so the cannabis crowd is losing heart. Cannabis stocks are in the doldrums. But they will get a big bounce if rescheduling actually happens, which I believe will be the case. The timing is hard to predict, but Trump did ask Bondi to act quickly.
Though the rescheduling delays have turned the cannabis investing crowd negative, I remain fairly certain rescheduling will happen. We continue to get solid signals from the White House that rescheduling is on track. Rescheduling will be a significant catalyst for cannabis stocks.
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3 Bullish Rescheduling Signals
Here are the three recent bullish signals from the Trump administration on rescheduling.
1) The first sign came after former drug czar Bill Bennett criticized rescheduling in a media interview. The White House responded by reiterating that it isn’t backing down on the rescheduling reform.
Bennett, the nation’s first drug czar under President George H.W. Bush, spoke out against President Donald Trump’s rescheduling plan in a Fox News Digital interview. “I love almost everything he does, but I don’t love this,” he said. Bennett claimed cannabis is a “gateway drug” that harms academic performance. He’s also unhappy about the cultural normalization of cannabis among young people.
Following Bennett’s anti-cannabis comments, the White House made it clear it will stay the course on rescheduling. “The President’s historic action paved the way for the development of promising new treatments for American patients, especially veterans,” White House spokesman Kush Desai subsequently told Fox News Digital.
2) In a recent Fox Business interview, Food and Drug Administration Commissioner Marty Makary also reiterated the administration’s intent to reschedule to promote medical research. He said the Trump administration is “very serious” about making sure that the medical use of cannabis is advanced. “And so, we’ve taken action to change the scheduling from Schedule I to Schedule III,” he said in the interview.
3) A third sign that the White House won’t drop the ball on rescheduling happened when Trump recently pardoned a former NFL star who was convicted of trafficking cannabis. All told, Trump granted cannabis-related clemency to five ex-NFL players. They included Nate Newton, who helped the Dallas Cowboys win three Super Bowls in the 1990s. Newton was convicted in 2002 in Texas for possessing 175 pounds of cannabis. The Trump pardons do not directly address rescheduling, but it is a confirmation that Trump is oddly cannabis friendly.
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