"The Big Short" refers to a now-classic play by legendary investor Danny Moses and just a few others who made an unthinkable sum of money shorting the sick, sick U.S. subprime mortgage market at a time when just about everyone else was enthusiastically buying into their financial doom.
A call like the "Big Short" takes real vision - and real guts.
So when I caught Danny on CNBC's "Fast Money," I was instantly intrigued.
He was talking about cannabis stocks... and he wasn't in the mood to do much shorting.
Quite the contrary: Danny was essentially laying out the case for a "Big Long" in our favorite sector.
He thinks there's more money to be made in marijuana than there ever was shorting housing.
Let me tell you why I'm so excited Danny Moses is in the picture; it has huge implications for our model cannabis portfolios...
[mmpazkzone name="in-story" network="9794" site="307044" id="137008" type="4"]
When Danny Moses Talks, We'd Better Listen (If We Want to Make Money)
Danny Moses may have gained his greatest notoriety from the '08 crash, but his expertise has a far greater reach than the housing markets alone.
Moses began his career in 1991 as a municipal bond analyst for MBIA Inc. (NYSE: MBI), working as an institutional broker at a number of firms, including Oppenheimer, a prestigious independent investment bank and financial services company.
THREE STOCKS: Any one of these cannabis companies could potentially deliver a 1,000% windfall. Click here to learn more...
But it was as a trader with Frontpoint Partners that he gained his greatest fame yet for foreseeing the impending financial crisis and shorting the subprime market.
When an individual has such an uncanny ability to recognize trends and play them to his advantage, well, it pays to listen.
Today, Moses serves on the investment committee of Merida Capital Partners - a private equity fund targeting the fundamental growth drivers of the cannabis industry - and he recently founded Moses Ventures, a multi-asset investment fund with a focus on cannabis.
So why is this financial expert targeting cannabis?
Moses Is Looking at "the Big Long"
In his "Fast Money" appearance, Moses picked out a few key elements that make the cannabis industry an outstanding sector in which to "go long." And when he got into it, he started talking in superlatives.
"I've never seen a sector have the political tailwinds, the economic tailwinds, and the wellness tailwinds that this sector potentially has," he said.
And comparing the opportunity to the housing collapse, he pointed out that "shorts can only go to zero - longs can go to infinity." In other words, the upside potential in cannabis is unlimited.
And with federal prohibition still in effect, Moses believes multistate operators present an interesting case: Banks do not lend money to companies in the industry because of their murky legal status, so these companies are not working on debt.
So, in Moses's words, where the housing markets were under-regulated and over-leveraged before their collapse, the cannabis sector today is just the other way around: overregulated and under-leveraged.
And it's ready to explode.
As we already know, that explosion is set to take place once banking services become available to cannabis companies - either through the STATES Act or another means.
And Danny Moses agrees. "If you were to get debt to come in," he said, "the cost of capital would go down dramatically for these companies, and so I think that's a really interesting play that people aren't really focusing on right now."
America's Green Gold Rush Is Just Getting Started - Claim Your Stake Now
At this very moment, big investment firms and members of the Fortune 500 are building enormous war chests.
They're preparing to push billions upon billions of dollars into the cannabis market - and they could strike at any moment. So right here - right now - you have a once-in-a-lifetime opportunity to beat them to the punch and stake your claim.
Follow Money Morning on Facebook, Twitter, and LinkedIn.
About the Author
Greg Miller started working on Wall Street in September, 1987, just a month before the “Black Monday” stock market crash.
During his career there, he became an expert in just about every kind of publicly traded security - from blue-chip and small-cap stocks to municipals, junk bonds, and derivatives. As a portfolio manager, Greg was responsible for over $500 million of assets in mutual funds and insurance company accounts.
After leaving the Street, he designed a successful options trading strategy and made lucrative tech investments for a financial publication. He has also helped develop new products and worked with other editors to hone their strategies. He’s always been dedicated to deep, fundamental research - and he always will be - because he believes buying the very best companies at the right price is the best way to amass wealth in the stock market.