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  • 📈Daily Cannabis Use Is Rising📈

📈Daily Cannabis Use Is Rising📈

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William McNarland & Anthony Varrell
May 23, 2024

GM Everyone,

Judging by the arguments in the Boies case yesterday, one thing was clearly evident: the DOJ seems to be taking a rational approach to cannabis. To our surprise, they came calm, cool, and collected. They weren't there to be combative but instead took a sensible and informed approach to the matter. David Boies also put on a clinic in how to defend against the arguments the DOJ brought to the table regarding the dismissal of the case. Overall, it was much tamer than I had expected, but we all got some solid sound bites from the DOJ and a firsthand account of how the case should progress. We will be keeping a close eye on this as the judge moves to continue or dismiss the case, as the appellate court would be up next.

Today’s letter can be read in 8 minutes and 16 seconds.

What's Driving the Market Today?

Stock market futures are up siginficantly; these are the top highlights moving the markets:

  • Nvidia's Q2 revenue forecast beats estimates, shares up 7% in extended trading.

  • VIX hits lowest since Nov 2019; Treasury MOVE index drops to Feb 2022 levels.

  • Fed expected to keep rates unchanged; mild impact from hawkish meeting minutes.

  • UK inflation data impacts rate cut hopes; election news adds to market volatility.

Daily Cannabis Use Surpasses Alcohol in the U.S.

Facts that matter:

  1. Daily cannabis use in the U.S. surpasses alcohol for the first time

  2. Cannabis use is seen as therapeutic, driving industry growth 

  3. Health experts warn of addiction risks with high-frequency cannabis use. 

Quick Hit: Millions of people in the U.S. report using marijuana daily or nearly every day, according to an analysis of national survey data, and those people now outnumber those who say they are daily or nearly-daily drinkers of alcohol. While alcohol remains more widely used overall, 2022 marked the first time that this intensive level of marijuana use overtook daily and near-daily drinking. Jonathan Caulkins, a cannabis policy researcher at Carnegie Mellon University, stated that “a good 40% of current cannabis users are using it daily or near daily, a pattern that is more associated with tobacco use than typical alcohol use.”

Canna Provisions vs Garland: A Legal Battle for Cannabis Reform

Facts that matter:

  1. Lawsuit by Canna Provisions vs Garland aims to end the federal criminalization of marijuana.

  2. Canna Provisions case shows wide support for changing cannabis laws.

  3. Potential for significant legal reform in Canna Provisions vs Garland case.

Quick Hit: Filed in late 2023, this lawsuit challenges the constitutionality of cannabis’ status under the Controlled Substances Act (CSA). Represented by the law firm Boies Schiller Flexner LLP, the plaintiffs aim to eliminate the federal criminalization of marijuana, arguing that the current federal approach is inconsistent and outdated. Josh Schiller, a partner at Boies Schiller Flexner LLP, emphasized the long-term effort behind this case: “We’ve been working on a case theoretically for six years. For the last two years, we’ve been working with the people you see on either side of me and a group of other people supporting a case to get rid of federal criminalization of marijuana.”

Coverage Initiated: New Lake Capital Partners

NewLake Capital stands out in the small-cap stock market for its strong financials and its unique position in the cannabis sector. The company’s business model operates on a simple yet efficient premise where it serves as a landlord to cannabis operations, offering real estate solutions that are both strategic and lucrative.They take in the money from the cannabis companies and manage it. The company takes a narrow, thin charge for doing that.

FIT21 Bill Faces Opposition from Biden and Gensler

Facts that matter:

  1. Biden administration criticizes FIT21 bill for lacking investor protections.

  2. Gensler highlights FIT21 bill’s failure to cover all market areas.

  3. Gensler calls for FIT21 bill revisions to support market stability.

Quick Hit: The FIT21 bill, formally known as the Financial Innovation and Technology Act of 2021, seeks to address the rapidly changing landscape of cryptocurrency regulation. However, the Biden administration argues that the bill falls short in providing adequate consumer and investor protections. SEC Chair Gary Gensler has echoed these concerns, warning that the bill could create regulatory gaps and pose risks to market stability.

Canna Provisions vs Garland Update

Facts that matter: Join us today for the TDR Trade to Black Livestream at 4 pm EST to get an update from TerrAscend Chairmen Jason Wild on Canna Provisions vs Garland as the cannabis industry challenges the US Federal government's position on cannabis under the Controlled Substance Act. The case is led by David Boies of Boies Schiller Flexner, whose other prior clients include the Justice Department, former Vice President Al Gore, and Plaintiffs in the case that led to the invalidation of California’s ban on same-sex marriage. Afterward, we will be joined by Emily Paxhia, the co-founder and managing partner of Poseidon, who will share her takeaways from the case.