Strength and Gratitude

The bull run continues for cannabis.

Daily Recap

The cannabis rally resumed on Monday as U.S. cannabis ETF MSOS continued it’s pattern of making higher highs and higher lows since the HHS news leaked August 30th. The NYSE-listed ETF was down 31% YTD eight short sessions ago but after today’s move, it is now up 31% YTD (still -24% YoY).

Volumes continued to surge. Total notional volume across all U.S. plant-touching stocks and ETFs was ~$20M per day throughout August as the stocks were a public reflection of private equity. Since the HHS announcement which again, was during the last days of summer, notional volume has swelled to ~$260M per session.

There is evidently strength in numbers after MSOS spent most of the weekend among the most-mentioned stocks on r/Wallstreetbets. I would argue—and will, below—that there is also strength in math as the reality of the potential 280E inflection makes it’s way around Wall Street research desks.

[I spent time last Thursday with the CIO at one of the world’s largest asset-managers; when I saw him again yesterday, after he evidently brushed up on these developments, it was all he wanted to talk about. It’s anecdotal, I know, but still interesting]

The enthusiasm was infectious, as evidenced by the lift up north in Canadian LP’s.

Canopy Growth was +81%, Aroura was +72%…. yes, much of this move was a massive short squeeze from super-depressed levels but it speaks to the offsides and brings to mind an observation from last week: that all bull markets begin with a short squeeze.

[note: while the relaxation of U.S cannabis regulations would be incrementally bullish for global cannabis markets, including Canada, the move to SIII, if codified, would disproportionately benefit U.S. multistate operators, or MSOs]

At the state level, Connecticut’s adult-use canna sales topped $68M to date after The Constitution State put $25M on the board in August, and Maine set a new record for the fourth consecutive month after they sold $22M during the last month of summer.

Cannabis ETFs are off to a strong September—will the buzz last? That’s what alotta folks are asking, if the amount of articles recently published is any indication. There are numerous opinions about which ETFs, if any, are right for you but you’re the only one who can make that decision, so choose wisely.

In other news, a lawsuit is seeking to undo Virginia’s 0.3% Total THC limit on hemp-derived cannabis products; a judge blocked Arkansas’ ban on delta-8 THC and other hemp products; drama continues to continue in New York as cannabis is everywhere except the actual legal operators and activists continue to urge NY regulators to delay access for MSOs; cannabis delivery is coming to New Jersey as they prepare to relax regulations on most edibles; Polynesia is legalizing CBD and eyeing a MMJ roll-out; PA podiatrists could soon recommend MMJ to patients; the new comp tables are here; there’s more insider buying at 4Front; we’ll look at current multiples and expansion targets, chew through the new short interest data, zoom out for some perspective and take a refresher course on the CSA and 280E math.

All that and more, just scroll down.

Non-Market Stuff

I often felt guilty about 9/11; too guilty to focus on my feelings when so many people lost so much more; sons, wives, mothers, brothers; I lost friends yes, but not like that.

The trauma was and remains real. There is no shame in acknowledging that bc once you acknowledge it, you can help solve for it.

I knew I was off late last week but didn't know why; melancholy, if not sadness.

Why? My business had enjoyed a historic revival; my wife and I were seeing Sting at Jones Beach Friday and a few buddies were coming over for the games on Sunday.

But there was a persistent tightness in my chest, like a knot of anxiety and I finally recognized it. I recognized it like I had been trained to recognize it by Dr. Julie Holland years ago.

While gratitude didn’t erase it, it immediately helped dilute it and provide enough of a respite to know I wanted to do more of that. It is a process, these things.

Anxiety, depression, panic, call it what you will; I'm sure a lot of people still call me an asshole bc we happened to cross paths while I was inside my head trying to reconcile whatever it was I was wrestling with at the time.

I'm 54 now. 9/11 was 22 years ago. And the more I look around, the more I read, the more I study, the more I see: everyone is fucked up in their own unique way.

Everyone.

I often write about the markets, 'there's no shame in admitting it's hard, there's only shame in pretending it's not.' That goes double for life.

If you're struggling—like I have and still do, at times—listen to yourself, think about some of your blessings and find someone you trust to speak with.

Brokedown Palace: Reflections on the 22nd anniversary of 9/11

#NeverForget911

SPY 0.00%↑ QQQ 0.00%↑ IWM 0.00%↑ MSOS 0.00%↑ PT Notional: $217M

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