U.S. Attorney General Jeff Sessions is ending an Obama-era DOJ marijuana policy that kept the federal government from interfering in states that legalized marijuana. And marijuana stock prices are plummeting today (Jan. 4).
But Money Morning readers need to know this isn’t a time to panic.
But even with CBDS down over 25% today, the CBD stock price has still climbed 29% over the past year.
You see, all marijuana use is illegal under federal law. The federal government has simply avoided spending money enforcing the law in states that legalized cannabis.
A DOJ memo addressing the issue in 2013, known as the “Cole Memo,” called for federal prosecutors to take a hands-off approach on cannabis regulation.
If a state legalized medical cannabis, U.S. attorneys were to deprioritize prosecution of cannabis-related cases, according to TheHill.com.
Sessions’ announcement today will rescind that policy. But it’s not clear if Sessions will provide new guidance or simply allow U.S. attorneys to choose how to enforce federal law on their own.
The sudden change to federal policy has marijuana investors nervous – especially those hoping to profit from cannabis legalization, like California’s.
And it’s easy to panic after seeing an investment drop more than 20% in a day.
But now is not the time to panic. It’s actually time to acquire an even bigger stake in pot stocks.
Today’s Price Drop in Pot Stocks Is Creating the Perfect Buying Opportunity
Sessions might be trying to fight legal marijuana, but his announcement is too little and too late.
Right now, 29 states and the District of Columbia have legalized some form of medical marijuana.
Also, the biggest state in our country by population, California, just legalized allcannabis use on Jan. 1, 2018.
With 58% of U.S. states legalizing medical marijuana and eight states legalizing both medical and recreational cannabis, the industry is too big to stop.
Cannabis legalization is more than just a trend, and the attorney general isn’t going to reverse it.
But there are going to be price drops in pot stocks, like today’s, because there is still uncertainty around this new industry.
For savvy investors, now is the perfect buying opportunity. It’s a way to own cannabis stocks at a discounted price.
It’s no longer a matter of if medical marijuana will be legalized in all U.S. states, it’s just a matter of when.
*This has been a guest post by Money Morning*