More speculation on the cash situation. from Capital and Conflict 27 February 2017 . Eerie calm NICK O'CONNOR. (Not condoning because I don't use it, but maybe people could do with a therapeutic joint after this, just saying. Michaela)

27 February 2017

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Eerie calm NICK O'CONNOR Dear Reader What connects an outlawed market that’s legal once again… the biggest moral conundrum the tech world faces… and a big development for post-Brexit northern England? They’re all a part of today’s Capital & Conflict, of course!

But back to the markets. What might cause them to instinctively question the Trump rally? Remember, you need “story” to justify lower prices and a powerful and clear catalyst to lend urgency to it.

What could that be? According to David Stockman (who was budget director under the Ronald Reagan administration), there’s a story and a trigger everyone’s missing: the US debt ceiling, and 15 March:

I think what people are missing is this date, March 15th 2017.  That’s the day that this debt ceiling holiday that Obama and Boehner put together right before the last election in October of 2015. That holiday expires. The debt ceiling will freeze in at $20 trillion. It will then be law. It will be a hard stop.  The Treasury will have roughly $200 billion in cash. We are burning cash at a $75 billion a month rate. By summer, they will be out of cash. Then we will be in the mother of all debt ceiling crises. Everything will grind to a halt. I think we will have a government shutdown.  There will not be Obama Care repeal and replace. There will be no tax cut. There will be no infrastructure stimulus. There will be just one giant fiscal bloodbath over a debt ceiling that has to be increased and no one wants to vote for.

Right now the markets seem content to ignore this. But for how much longer? And what could lend enough urgency to the story to reverse momentum in the markets? More on that another day!

Does The Donald get high?

If you’re an Exponential Investor reader, you’ll notice that the rest of this week has a heavy bias towards cannabis. Why? Because right now the market for commercial marijuana is developing rapidly, which is creating major opportunities for investors, traders and speculators.

Later in the week Eoin Treacy will be presenting the one pot stock to buy now. It’s a high risk speculation. But if it comes off, the payoff could be extreme.

Increasing numbers of US states have been voting to legalise cannabis for commercial/recreational use. Colorado and Washington were the trailblazers on that front. But the big one came last year (on the same day as Trump’s election, ironically) when California voted to legalise it.

Legalisation doesn’t take effect until the start of next year. But when it does, it’ll be an enormous market with enormous potential. As I wrote last week it is comparable with the end of prohibition creating a legal market for alcohol. Imagine owning a brewery or distillery then!

That’s Eoin’s goal now: own the supply chain of the cannabis industry as it legalises. But is it truly “legal”? Increasing numbers of states are legalising it. But it’s illegal on a federal level. Given the states are mostly in charge of enforcing drug operations, it’s unlikely you’d see the federal government step in. "In terms of marijuana and legalisation, I think that should be a state issue, state-by-state," Donald Trump said in Nevada in October 2015.

But who knows exactly what he’ll do. Perhaps he’s now vehemently anti-cannabis. Perhaps he’s all for it. Figuring out actual policy from amidst the ramblings is difficult. There have been rumblings that the federal government will attempt to be stricter in its application of the law. I doubt that’s anything but political posturing for now. But it does create the risk of a turbulent and volatile time for pot stocks.

You should know that going in. It’s a risky play. But some risks are worth taking. This could be one of them. Look out for more from Eoin later in the week.

https://www.capitalandconflict.com/brexit/eerie-calm/

Also, who is the unidentified investor mentioned below, bet it is a big pharma from USA who will buy it up (and then possibly run it into the ground and close it down... Again, just saying, Michaela.

http://www.medicalmarijuana.eu/gw-pharmaceuticals-set-takeover/

Shares in British medical cannabis giant GW Pharmaceuticals have jumped by 22% amid rumours that the company could be the subject of an imminent takeover bid.

According to reports, the Nasdaq-listed company has recently hired investment bankers at Morgan Stanley to ‘explore its options’ after being approached by an unidentified investor. These rumours have sparked a rush to buy shares in the business, despite the fact that according to a GW spokesperson, Morgan Stanley have been advising GW for many years.

Of course any prospective takeover bid would not exactly be a massive shock. Despite overall volatility, GW’s shares have been trending upwards thanks in large part to both the success of their first drug – Sativex – and promising trial results from their second – Epidiolex.

Sativex is already approved for the treatment of multiple sclerosis and cancer-related pain in many markets around the world, and is currently undergoing trials in the US with a view to achieving approval there – something which would expose it to the largest pharmaceutical drug market in the world. This approval is thought to be little more than a formality, as presumably is the approval of GW’s second major drug, Epidiolex.

Epidiolex is currently in late stage trials for two separate indications, and if and when it is approved, analysts predict sales of £1.4 billion per year in the US and Europe. It’s not difficult to see why there might be interest in purchasing the company at this time, just before its value skyrockets even further.

Not everyone is entirely convinced that all this excitement is justified just yet, however. Alan Brochstein, a founding partner at New Cannabis Ventures and Founder of 420 Investor, told benzinga.com that the timing of the supposed buyout interest “seems a bit premature.” His reasoning is quite simply that GW have not yet shared the full data from its Phase 3 clinical trials of Epidiolex, adding that he “…would expect potential acquisition interest to increase after the company files its NDA for Epidiolex in 4-10 months.”

Despite Brochstein’s understandable caution, it does seem as though GW could be on the brink of huge commercial success. As a result, the idea that one of the partners who distribute their drugs – Bayer, for example, or Novartis, both much larger companies – would decide that a buyout would be in their best interests does seem to ring true. However, GW are not short of cash, so could well decide to carry on going it alone, for now at least.

Whatever they decide, their success will continue to be a thorn in the side of the British government, who continue to insist that cannabis does not possess any medical or therapeutic properties. Every time GW’s stock rises, and the calls for cannabis to be rescheduled ring out loud and clear, their position becomes more and more untenable.

https://www.gwpharm.com/  GW is the global leader in developing cannabinoid-based medicines. Our lead product candidate, Epidiolex® (cannabidiol)  is in development to treat rare and catastrophic forms of childhood-onset epilepsy, potentially offering relief to patients for conditions that previously had few treatment options.