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Marijuana kills… its competitors | The Crux



From Justin Spittler, Editor, Casey Daily Dispatch:

Marijuana kills.

Not people, obviously. There’s never been a single recorded marijuana overdose death ever. Not one.

I’m talking about the competitors. But just who are marijuana’s competitors? Well, that’s a tricky question.

You see, marijuana doesn’t just get people high. It’s also medicine. And it has industrial uses. But for today’s essay, I’ll stick to the other so-called vices: tobacco and alcohol.

Today, I’ll show you why marijuana is a huge, direct threat to Big Tobacco and Big Alcohol. But let me first tell you why you should listen to me…

Last year, I made it my mission to learn as much about the marijuana industry as possible…

But I didn’t just sit at my desk and read other people’s research. No. I took a page from Doug Casey’s book…

I turned in my house keys, sold all my belongings, and went to the front lines of the global marijuana boom.

I spent a month in Vancouver, a month in San Francisco, and a month in Denver. Along the way, I visited marijuana business incubators. I had coffee with marijuana venture capitalists. I even toured several world-class marijuana facilities.

Here’s a marijuana chocolate factory that I visited in Denver, Colorado:

I did all of this because marijuana is one of the world’s fastest-growing industries. It’s also one of the best investment opportunities to come along in decades.

And it’s my job to identify and help you profit from these types of opportunities…

I’m now in Buenos Aires, Argentina…

I came here to learn more about this fascinating economy, work on my Spanish, and spend some quality time with Doug Casey.

Friday before last, Doug and I had dinner in the beautiful neighborhood of Recoleta. We talked about many different things over steak, cow brains, and wine (Doug ordered the cow brains). But Doug kept asking me about the marijuana industry. He was particularly curious about the investing opportunities in the space.

And that’s saying something. You see, Doug was an early investor in this industry. In fact, one of his marijuana investments has already gone up 1,900%.

That’s an incredible return. But Doug believes this investment could go up 100x before all is said and done. And I think he’ll get that 100-bagger for one simple reason…

The marijuana industry is exploding…

It grew 30% in 2016. That’s nine times more than the U.S. economy grew that year.

And in 2017 it grew 37%… eight times more than the U.S. economy.

According to Cowen & Co., the North American marijuana industry will be worth $75 billion by 2026. That’s eight times bigger than it is today.

The industry is exploding because marijuana legalization has taken over America. Medicinal marijuana is now legal in 30 states plus Washington, DC. Recreational marijuana is legal in nine states, plus DC.

As a result, marijuana is no longer just for stoners…

People from all walks of life now consume it. We’re talking lawyers, accountants, and nurses.

In other words, the stigma of marijuana being a “street drug” is dead. And that’s very bad news for Big Tobacco.

You can see why below. This chart shows the performance of Altria (MO), one of the world’s largest tobacco companies, over the past year.


As you can see, Altria’s stock has lost over a fourth of its value in the past year. But it plummeted last week after Citigroup downgraded the stock.

Altria’s not the only major tobacco stock plunging, either…

Philip Morris (PM) is in big trouble, too. Take a look…


Recently, PM’s stock fell 18% after it shared poor first-quarter results. Specifically, the company reported a 2% drop in earnings.

British American Tobacco (BTI), another major tobacco company, is also in free fall…


To be fair, tobacco sales have been falling for years. And legal marijuana isn’t the only reason for this. Many once-loyal tobacco customers are “vaping” instead of lighting up.

So, I’m not attributing the recent sell-off in tobacco stocks entirely to marijuana. But I will say this…

People are smoking fewer cigarettes and a lot more pot. And that’s not going to change anytime soon. In fact, this trend is only going to continue..

Remember, recreational marijuana is currently only legal in nine U.S. states…

So, just imagine what will happen to tobacco sales when more states introduce recreational marijuana. They’ll plummet even more.

And this will force tobacco companies to turn themselves into marijuana companies.

Now, they could do this by developing their brands from scratch. But that’s expensive and risky. So, here’s what will happen instead.

Big Tobacco companies will buy existing marijuana companies.

That might seem like a bold call. But it really isn’t.

After all, Big Alcohol is already doing this…

In October, Constellation Brands bought a 10% stake in Canopy Growth…

Constellation is the third-largest beer supplier in the U.S. It makes the popular brands Corona and Modelo. It’s also the world leader in premium wine.

Canopy, on the other hand, is the largest marijuana company on the planet. It serves more than 60,000 medical marijuana patients in Canada.

The deal was worth $191 million, making it one of the biggest marijuana deals ever.

Constellation did this because marijuana is a massive growth opportunity… and it’s also a huge threat to Constellation’s core business.

In fact, a recent study concluded that alcohol sales fell 15% in states that introduced medical marijuana.

So, Constellation had to adapt or die. And I can promise you this…

Major tobacco companies will do the exact same thing…

They’ll shell out huge sums to buy up marijuana assets.

And I’m not talking about years from now, either. This could happen in the coming months.

So, consider speculating on marijuana stocks today. Once this dealmaking frenzy gets underway, marijuana should soar like we’ve never seen before. And that’s saying something.

After all, the average marijuana stock gained 245% between last September and January. The best ones soared even higher.

Just remember what I always say about marijuana stocks—they’re highly speculative. So don’t bet more money on them than you can afford to lose. Have an entry and exit strategy. And take profits when they come.


Justin Spittler

P.S. Last week, over 20,000 people tuned in to learn what Doug Casey knows about the fast-growing marijuana market during our exclusive Pot Stock Millionaire Summit.

During the event, our team shared critical details on the top marijuana companies in the space today. Our live presentation is no longer online. But we created a brand-new video where you can catch up on all the details. This special presentation is only available until midnight tonight, so check it out here while you still can.

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What the hell happened at General Electric?




Few corporate meltdowns have been as swift and dramatic as General Electric’s over the past 18 months – but the problems started long before that.

From Fortune:

It’s a bad day for a CEO when he announces he’s retiring and the stock goes up. That was Jeff Immelt’s day on June 12, 2017. The news of his departure was in one sense no surprise – some investors and analysts had been urging his ouster for years – but it was also a shock.

He’d been General Electric’s CEO for almost 16 years, and outsiders were unaware of any specific succession plans or that ­Immelt, at age 61, had any intention of stepping down. Suddenly they were told that in just seven weeks he’d be gone as CEO (he remained nonexecutive board chairman an additional two months), to be succeeded by John Flannery, head of GE’s health care business and a 30-year employee. Investors didn’t need long to decide this was good news. The market was flat that day, but they bid GE stock up 4%.

Their optimism was at best premature. The stock closed at $28.94 on June 12 and has not reached that price since. As economies boomed worldwide and U.S. stock indexes soared, GE has collapsed in a meltdown that has destroyed well over $100 billion of shareholder wealth. Pounded by a nonstop barrage of bad news, investors are traumatized and disoriented. “They just can’t figure it out and don’t want to invest,” says analyst Nicholas Heymann of William Blair & Co. “This isn’t like surveying the landscape. It’s spelunking with no lights and no manual.” Analyst Scott Davis of Melius Research says some investors have become permanently disillusioned: “Many have told us they will never own GE again.”


Retirees and employees who bought heavily into the stock are furious; some picketed GE’s annual meeting in April. Former executives are dumbfounded. “It’s unfathomable,” says one. “You couldn’t possibly dream this up. It’s crazy.” After all, this is GE, a corporate aristocrat, an original Dow component, the world’s most celebrated management academy, now revealed as a financial quagmire with a deeply uncertain future. Its bonds, rated triple-A when Immelt became chief, are now rated five tiers lower at A2 and trade at prices more consistent with a Baa rating, one notch above junk.

In response to this debacle, GE has repudiated its previous leadership with a zeal unprecedented in a company of its size and stature. Gone in the past 10 months are the CEO, the CFO (who was also a vice chair), two of the three other vice chairs, the head of the largest business, various other executives—and half the board of directors. The radical board shake-up “could be one of the most seminal events in the history of U.S. corporate governance,” says a longtime vendor and close student of GE.


Immelt (left) and Flannery announcing the succession. Flannery would soon replace much of Immelt’s top team and strategy. Courtesy of General Electric.

Immelt declined to be interviewed for this article but sent Fortune a statement in which he cited accomplishments and said, “None of us like where the stock is today. I purchased $8 million of stock in my last year as CEO because I believe in the GE team. I love the company, and I urge them to start looking forward and win in the markets.”

Flannery’s strongest message is how completely he’s breaking with GE’s recent past. “The review of the company has been, and continues to be, exhaustive,” he told investors last October. Specifically: “We are evaluating our businesses, processes, [the] corporate [function], our culture, how decisions are made, how we think about goals and accountability, how we incentivize people, how we prioritize investments in the segments …  global research, digital, and additive [manufacturing]. We have also reviewed our operating processes, our team, capital allocation, and how we communicate to investors. Everything is on the table …  Things will not stay the same at GE.”

Inescapable conclusion: This place is an unholy mess.

Continue reading at GE…

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Investors have completely given up on this commodity




From Steve Sjuggerud, Editor, True Wealth Systems:

It’s been beaten down, left for dead, and just forgotten.

When an asset underperforms for multiple years, investors tend to give up on it. They get burned and move on… at least for a while.

Today, we are looking at a commodity in that exact situation.

It’s down 44% since peaking in 2014. Investors want nothing to do with it… But history says a triple-digit jump is possible thanks to this extreme negative sentiment.

Here are the details…

When you think about commodities, you probably think of oil and gold… maybe even crops like corn and wheat.

Today’s commodity is a bit more obscure. It’s probably off your radar. Honestly, it’s probably off everyone’s radar.

We’re talking about hogs.

You see, hog prices have fallen dramatically over the past three years. The commodity is down 44% since peaking in 2014. And not surprisingly, investors want nothing to do with it.

It only takes a quick glance at the Commitment of Traders (COT) report for hogs to see this extreme sentiment.

The COT report is a real-time indicator that shows what futures traders are doing with their money. It’s a great investment tool. It shows us contrarian bets when futures traders all agree on an outcome.

When futures traders are all making the same bet, the opposite is likely to occur. Right now, futures traders are all betting on lower hog prices. Take a look…


Their bets have only been this extreme a few times over the past decade.

We saw similar extremes in 2009, 2012, and 2015. Each extreme lead to dramatically higher hog prices in the following months…

From August 2009 through April 2011, the commodity jumped 134%. Then another similar setup happened in mid-2012. Hog prices bottomed shortly after and then rallied 85% in less than two years.

In mid-2015, investors gave up on hog prices again… right before the commodity soared 70% in less than a year.

These are incredible returns. But it’s what can happen when investors completely give up on an asset. Today, futures traders have given up on hogs once again.

One way to take advantage of this is through the iPath Bloomberg Livestock Subindex Total Return ETN (COWTF). The fund tracks the Bloomberg Livestock Subindex Total Return Index. Its main focus is on hog and cattle futures.

We aren’t officially recommending COWTF today. The uptrend simply isn’t strong enough. But this is a fantastic long-term setup. And when the uptrend returns, hog prices could potentially see triple-digit gains.

Crux note: Steve’s trading strategies cover every corner of the market – more than 40 different sectors – so readers will always have the opportunity to make money somewhere… even in hogs.

And only Steve’s True Wealth Systems subscribers can get immediate access to the team’s weekly Review of Market Extremes.

For more details, click here.

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Cramer’s charts suggest investors buy Akamai and sell Walmart




In an emotional market where investors struggle to process the White House newsflow, CNBC’s Jim Cramer likes to fall back on the technicals to find actionable opportunities.

“In the stock market, emotional decisions tend to be bad decisions,” the “Mad Money” host warned. “So we need to do everything we can to check our emotions at the door. And that’s why, every week, we like to play off the charts.”

For Wednesday’s charts, Cramer turned to technician Marc Chaikin, the founder and CEO of Chaikin Analytics and the inventor of key technical tools like the accumulation-distribution line, the Chaikin volume indicator, the Chaikin oscillator and the Chaikin Money Flow.

Three weeks ago, Chaikin recommended three stocks on “Mad Money” based on his formula for finding winners and losers: Marathon Petroleum, EOG Resources and General Electric.

Since then, Marathon and EOG have gained 8.2 percent and 4.6 percent, respectively, and GE was up 9 percent as of Tuesday before its CEO gave a poorly received presentation.

“Two out of three ain’t bad, and if you’d taken profits on GE yesterday, you would’ve had a phenomenal trade,” Cramer said.

Chaikin’s formula uses three key indicators: the Chaikin Money Flow, which measures buying and selling pressure in a stock; the Chaikin Relative Strength, which compares a stock’s performance with the S&P 500’s over the last six months; and the Chaikin Power Gauge, which uses 20 different fundamental and technical inputs to produce a bearish or bullish reading.

This time around, Chaikin’s formula flashed particularly bullish signals with the daily stock chart of Akamai Technologies, a cloud play that helps companies get content like streamed video online securely and glitch-free.

Shares of Akamai have been soaring since activist fund Elliott Management said it took a 6.5 percent stake in the company last December, but Chaikin’s three indicators showed more room to run.

The Chaikin Money Flow turned positive, meaning that institutional investors were buying the stock, the Chaikin Relative Strength has been strong for months, and the Chaikin Power Gauge is sending green bullish signals.

Still, the technician warned that the stock is very overbought, suggesting that investors wait for a pullback to the $72 to $74 level before picking up some shares.

“My view? I like Akamai here — we recommended it at $73 in mid-March — but I’d like it even more into weakness because I believe in Elliott Management’s ability to take this business to the next level,” Cramer said.

Chaikin’s formula can also signal when a stock should be sold. On Wednesday, Chaikin zoomed in on the stock of Walmart, down over 4 percent since the company’s earnings report.

Having spent months in the red, the Chaikin Money Flow inched up after the report, but is still flat, Cramer said. The Chaikin Relative Strength indicator is also negative, reinforcing the stock’s decline. Unsurprisingly, the Chaikin Power Gauge is flashing bearish signs, too, he added.

“My view? I like Walmart long term, but Chaikin may be right about the short term,” Cramer said. “Wall Street really dislikes the fact that the company’s spending so much money to grow its business, including that acquisition of Flipkart, the Indian e-commerce play. I think these bets are ultimately going to pay off, but it could take time.”

“Bottom line? The charts, as interpreted by Mark Chaikin, suggest that you should buy Akamai here and sell Walmart,” the “Mad Money” host concluded. “Given his track record, I think you need to take his advice very seriously, especially on the stock of Akamai.”

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