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If the cannabis industry is desperate for capital, time to bet on the guys with capital

With a little over and hour left in the year 2019, past 10PM on December 31, I saw a news release from James E. Wagner Cultivation (JWCA.V) about a small $2 million loan they’d taken out. The timing of the announcement of their loan was surely not coincidental. Actually, thinking about it, ‘payday loan’ might be the more appropriate term to have used. JVCA took out a debenture financing of $2 million at an interest rate of 25% annually. That’s just the first tranche of the deal; there’s another $8 million out there if they want it. My credit card, abused as it has been, costs me less interest to maintain than JWCA’s loan.

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1933 Industries (TGIF.C) blows up, jumps 35% preceding California harvest announcement

You’ve gotta love it when a plan comes together: 1933 Industries (TGIF.C), which has been banging the same ‘we’re grownups, we’re doing it right, hang tight’ drum for several years now, dropped news this February 14 that will make any Valentine’s heart swell with joy. “Following the completion of a combined 20,000-square-foot expanded cultivation, extraction, manufacturing and distribution facility in the Los Angeles area, the company began harvesting its first cannabis crop this week to be utilized for both its proprietary brand Alternative Medicine Association (AMA), as well as for its licensing partner luxury brand Blonde cannabis, with products earmarked for dispensaries for the first time outside of Nevada.”

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Fire in the hole: Supreme Cannabis (FIRE.T) drops rough financials as expected, transition afoot

Ontario-based Supreme Cannabis (FIRE.T) released its Q2 2020 financials today and there were few surprises contained in its pages, bar perhaps the size of the quarterly loss. At a $17.3 million net loss after taxes (and a $10.4 million loss in adjusted EBITDA terms), FIRE shares fell in value below the $0.40 mark it’s been hovering around for some time, a 5% drop in real terms. Previous quarters had seen smaller losses, even come close to break even. But even the rosiest-eyed fanboy would have expected these numbers to be rough, considering the CEO change and staff layoffs announced earlier in the year.  We predicted as much a week ago.

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Powell: “Nothing about this expansion that is unstable”

Federal Reserve Chairman Jerome Powell said that the Fed is keeping a close eye on the possible fallout and impact of the coronavirus outbreak in China. Powell hasn’t made any claims yet as to what this means either in terms of possible liquidity injections or a rate cut. Let’s examine that.

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Hold your FIRE: Supreme Cannabis (FIRE.T) lays off staff in bid for balance sheet superiority

Large Canadian cannabis licensed producer Supreme Cannabis (FIRE.T) told the markets they’re laying off around 30% of their staff today, days before their next quarterly financials are released and with the dust still settling after their recent CEO change. To the casual observer, this might appear to be a sign of desperation, that the sky is falling in Kincardine, Ontario, and the owner of the esteemed 7 Acres brand was making some sort of last ditch effort to stave off Armageddon. It ain’t that.

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There’s no place like home: 3D Sustainable Developments prints an answer to the global housing crisis

Canada more than doubles the Indian subcontinent in terms of land mass, but its population of 37.59 million is a 2.8% sliver of India’s 1.3 billion – that’s 4 people per square kilometre compared to 420. Interestingly, both India and Canada are in the middle of a serious housing crisis that threatens to break the spine of India’s economic miracle and stab at the heart of Canada’s social stability. Will anyone be able to save us from this fate before it’s too late?

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Vext Science (VEXT.C) cannabis chart defies gravity

“The core business, which is derived from an Arizona licensed vertically integrated model, generated USD $13 million in revenues during the first two quarters of 2019,” confirmed Equity Guru’s Sam Bourgi last October.

Ironically, VEXT is a healthy cannabis business, and investors are quickly gaining confidence in it.

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1933 Industries (TGIF.C) 2019 sales were 20% of its current market cap

Cannabis investors exhibit the same psychological characteristics as Dutch teenagers, a “volatile mix of anxiety, irritability, exuberance and despair.”

With teenagers, the irrational mood swings are due to “stress points around the uneasy transition toward adulthood.”

Cannabis investors don’t have this excuse.

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2019 weed wrap: The end of the cannabis cycle of cannabis cycles

Like the old Twilight Zone episode where helpful aliens leave behind a book called ‘To Serve Man’, only for us to find out later it’s a cookbook, investors have been welcomed and fattened up nicely by alpha predators as they unwittingly await their slaughter, not realizing that, they’re at the predator’s table because they’re the main course.

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Icahn’s noxious no-brainers and America’s share buyback binge: Is value extraction a sham?

Icahn’s traveling roadshow is only marginally better than the criminal activities of Bain Capital. These vicious business vultures swoop in, gain control of the shares, get the company to load up on back-breaking debt to commence a share buyback scheme which they sell into and walk away from long before the company’s books explode all over the retail bag holders.

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Ceylon Graphite (CYL.V) up nearly double since shift to production

No resource, no multi-million dollar raise, no problem.

Ceylon Graphite (CYL.V), which has taken the unusual (in mining circles) decision to just freaking start digging, rather than go through eight years of behind-protection, triangulation, and capital raising first, is up 20% today as the first containers fill with graphite and execs chase down end user agreements.

With stock selling for just $0.06 a few days ago, volume has increased and buyers are being found, leading the stock to $0.095 at the time of writing.

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Equity.Guru podcast: Mistakes were made – Jeanette VanderMarel’s happy goodbye to Beleave (BE.C)

With the twitter announcement this morning that Jeanette had “happily” left the position of CEO at Beleave Kannabis (BE.C), Equity.Guru’s own Chris Parry was chomping at the bit to find out just what “happily” meant for the market and investors. Twenty minutes after making her announcement, VanderMarel phoned up Chris to give him the skinny on her decision as well as some explanations for past actions which gave both industry players and investors some pause.

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Falcon Gold (FG.V) is a tiny little bet on a big fat gold region

Close-ology is a mining term used to describe companies that are close to another company that is running red hot, and may justifiably make the case that they can be hot too.

For some, like serial ring-staker Ryan Kalt, close-ology is a business model. The moment someone announces they’ve found something interesting in Dildo, Newfoundland or Punkydoodle Corners, Ontario, Kalt’s crew hops on their laptops, busts out the credit card, and register claims all around it, sometimes without ever having walked the land.

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Deathwatch: MedMen (MMEN.C) is cutting out everything but the cancer that is killing it

If you’ve been around this joint for a while, you’ll have seen us arguing folks would be silly to invest in MedMen (MMEN.C) if hanging on to your money is a thing you aspire to do.

That’s not because we have a hate on for the dude-bros running the show, or because they’re not a client, or because we’re short sellers, or any of the other 50 or so reasons MedMen homers have thrown at us over the last few years as a rationale for us not seeing the company in the same rose-coloured way they do.

It’s because MedMen is, and has always been, shit.

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