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Market Morning: Brexit Barnier Barn Burner, Cannabis States Law, Libya Shakes Oil Market

ME Staff

EU Ups Ante On Brexit, Pokes UK In Eye

Chief Brexit negotiator for the European Union Michel Barnier has made a serious threat against the United Kingdom that is sure to anger the Brexiter Tories. Specifically, he said that the EU will insist on the dreaded “Backstop” for Ireland in order to prevent a hard border between Ireland, part of the EU, and Northern Ireland, part of the United Kingdom. “The EU will stand fully behind Ireland,” Barnier said on Monday at a joint press conference with the taoiseach, Leo Varadkar, in Dublin. The import of this is that the EU will effectively seek to strangle the UK economically if a backstop is not agreed on, whether the UK leaves the EU or not. The reason the Brexiters can’t stand the backstop is that it keeps Northern Ireland effectively in the EU without any representation or say in its operations. The backstop would effectively put Northern Ireland under a different set of laws than the rest of the UK, practically ripping it away from London’s control.

SEE: Cannabis Stock News Daily Roundup April 8

“The backstop is currently the only solution we have found to maintain the status quo on the island of Ireland … Let me be very clear. We would not discuss anything with the UK until there is an agreement for Ireland and Northern Ireland as well as for citizens’ rights and financial settlement,” he said, in Ireland, in English.

Cannabis Sector Waits With Bated Breath On States Law

The States Law has been reintroduced in Congress, aimed to protect companies from Federal intrusion in states that have chosen to legalize marijuana. Congresspersons Earl Blumenauer and Barbara Lee, both Democrats, will join the Minority Cannabis Business Association for a press conference on Tuesday at 11:00am EST to discuss people’s skin color and what that has to do with cannabis, as it has to do with everything these days. Blumenauer introduced the Strengthening the Tenth Amendment Through Entrusting States Act last week with Presidential hopeful Elizabeth Warren and others. It would change federal law to exempt business and individuals who comply with state law from complying with federal law, which prohibits cannabis across the board. So it would basically align law with reality. “The lawmakers and business leaders will discuss the path forward for ending the prohibition of marijuana, steps toward restorative justice for those negatively impacted by the war on drugs, and ways communities of color that were disproportionately impacted by cannabis prohibition can benefit from the new industry as owners, investors, managers and employees,” according to a media advisory. (NYSEARCA:MJ)

Housing Crash Accelerates in Vancouver

Soon by the United States again? We’ll see. The 2008 financial crisis began in Iceland of all places, and perhaps it is beginning now again in Vancouver. Perhaps not and this is just an isolated market crash localized in Vancouver, Canada. Vancouver just reported the fewest monthly real estate sales in 33 years. Total housing sales were 46.3% below the 10-year March sales average, the lowest total for the month since way back in 1986. Condo sales fell 35%, and prices are down 7.5% for the year. The culprit is higher taxes. “Housing demand today isn’t aligning with our growing economy and low unemployment rates. The market trends we’re seeing are largely policy induced,” Ashley Smith, REBGV president said. “For three years, governments at all levels have imposed new taxes and borrowing requirements on to the housing market.” If this housing crash is policy-induced rather than systemic coming from the banking system, then it probably won’t spread to the US, whose housing market keeps chugging along. (NYSEARCA:IYR)

Oil Continues Climb On Libya Civil War, Algeria Problems

Libya is erupting into full blown civil war. Things haven’t been going too great there ever since it was liberated by the United States, trying to make the world safe for democracy for 100 years now but not really doing so well at it. An airstrike at Libya’s only functioning airport in Tripoli has brought the number of functioning airports in Libya to zero, and its oil production is now seriously threatened. Libya currently produces about 1 million barrels of oil per day but the number keeps oscillating up and down due to the instability in the country for so many years. Back in late 2011, production was brought to a complete standstill for about 5 months as the country was being torn apart after its leader, Muamar Gaddafi, was assassinated. The United Nations is involved in this civil war too, since it is backing the current government, while the Libyan National Army is pretty upset about this and decided to attack Tripoli, the Libyan capital, to depose them. The UN is not too happy about the bombing of the airport either. Meanwhile, it looks like a revolution is taking place in Algeria, which also produces about 1 million barrels a day. Production there has been declining steadily since 2008. Oil (NYSEARCA:USO) is nearing $65

CVS, Aetna Deal In Doubt Due to Antitrust Concerns

A federal judge may yet reverse the CVS (NYSE:CVS) Aetna deal, the latter of which doesn’t even have a stock ticker anymore because the deal was already completed last November for $70 billion. The judge wants to hear from witnesses against the acquisition, though chances are the deal will not be canceled because it would be extremely disruptive to the company. “It does not violate the anti-trust laws, it’s horizontal. It does not impede competition, it enhances competition. It lowers prices,” Judge Napolitano told FOX Business on Monday. “It’s the type of merger that a judge should approve in a heartbeat.” The judge, Richard Leon, was appointed by President George W. Bush in 2002, so being nominated by a Republican probably will not reverse the deal.

 

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