Obama Signals Congress Will Need To Lead On Federal Marijuana Reform

See the link below for the full article we’ve highlighted the major issues as seen by the publication and it’s politics that’s creating inertia in the upcoming year as the presidential election cycle plays out

Fool.com write..

On the surface it would appear that everything is working in marijuana’s favor. However, if we peer out a little further and look at things from the federal level, marijuana’s 2016 forecast looks abysmal.

According to a report last week from The Washington Post, President Obama “signaled his position” at the House Democratic retreat in Baltimore that marijuana reform is not on his agenda in his last year in the oval office, according to Rep. Steve Cohen (D-Tenn.). A briefing the following day with White House press secretary John Earnest signaled that any reforms on marijuana would have to come from Congress.

…But Congress won’t make these changes in 2016
However, there are two big problems that are likely to keep marijuana from getting anywhere at the congressional level in 2016.

For starters, Congress simply has no incentive to rush a decision in 2016 with the critical November elections around the corner. Marijuana can be a polarizing issue, as the polls have shown, and the Republican-dominated Congress doesn’t appear willing to risk alienating its voter base by upsetting the established scheduling of marijuana at the federal level.

Secondly, and more importantly, lawmakers are still uncertain about the long-term safety profile of marijuana. There is no magic number that determines how many clinical studies is enough to make an educated call about marijuana’s safety..

…./…..The bad news is that even with marijuana expanding at the state level, it’s still looking like a terrible investment. Federal inaction means marijuana-based businesses are getting absolutely no help. They’re still paying taxes on their gross profits instead of net profits because they’re unable to take any tax deductions since they’re selling a “federally illegal drug.” Marijuana businesses also have very limited access to lines of credit and checking accounts because only a small fraction of banks are willing to work with marijuana businesses. Both of these points seriously constrain marijuana business’s growth prospects over the near-term.

For now marijuana looks to remain the underdog issue that around half of America is rooting for. Its expansion is certainly intriguing, and if it were ever decriminalized or legalized at the federal level it would potentially change the game for investors. However, until such time as Congress considers taking up marijuana legislation, it’s worth keeping your distance from marijuana investments.

Full Article:  http://www.fool.com/investing/general/2016/02/06/its-all-but-confirmed-marijuana-legislation-is-goi.aspx

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