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First round of voting starts Wednesday

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LONDON — The U.K.’s ruling Conservative Party has begun its race to find its next leader, and the country’s next prime minister, with eight candidates now in the running for the top job.

The candidates all had to win the initial backing of at least 20 of their fellow Conservative lawmakers in order to proceed to the first round of voting which takes place Wednesday.

In order to whittle the number of candidates down to just two, more votes will now take place – beginning Wednesday – with the 358 Conservative MPs asked to choose their favorite candidate to take over the party.

Any candidate receiving less than 30 votes from his or her fellow MPs will be eliminated in the first round of voting. Then in the second round, the candidates with the fewest votes are eliminated. These rounds of voting continue until two candidates remain, which is expected to happen by the end of this week.

When two candidates remain, all the members of the Conservative Party (some 200,000 people) are asked to vote by postal ballot on their favorite candidate. The winner is expected to be announced on Sept. 5.

Rishi Sunak makes a speech to launch his bid to be leader of the Conservative Party on July 12, 2022 in London, England. The former Chancellor was the second high-profile minister to resign from Boris Johnson’s cabinet last week setting in motion the events that saw Johnson step down as Conservative Party Leader.

Carl Court | Getty Images News | Getty Images

The eight candidates include well-known faces, such as former Finance Minister Rishi Sunak — one of the favorites to win — and Foreign Secretary Liz Truss and new Finance Minister Nadhim Zahawi, as well as those with less high-profiles such as Tom Tugendhat, Suella Braverman and Kemi Badenoch.

Former Health Minister Jeremy Hunt is also in the race, as well as Penny Mordaunt, international trade minister, another of the favorites who’s popular with grassroots party activists. Sajid Javid, former health secretary, withdrew from the leadership race on Tuesday.

Showing some division among Tory MPs and those among the more grassroots Conservative Party members and activists, Penny Mordaunt, a former defense secretary, topped a poll of Tory party members this week on who should be the next leader, with 20% of the vote.

Ex-local government minister Kemi Badenoch was seen with 19% of the vote, followed by Rishi Sunak on 12%, according to the poll of over 800 Tory party members on Tuesday by website Conservative Home.

“If Putin succeeds there will be untold further misery across Europe and terrible consequences across the globe,” said U.K. Foreign Secretary Liz Truss.

Mateusz Wlodarczyk | Nurphoto | Getty Images

Tuesday night, the eight candidates had 12 minutes each to try to convince their fellow MPs why they should be the next leader of the party and the country. Several promised to cut taxes and unite the party after the spectacular fall of Boris Johnson, who remains as prime minister but only in a caretaker role while his replacement is found.

Summing up the economic implications of the candidates expected to proceed to at least a second round of voting, Daiwa Capital Markets said that “at the time of writing, former Chancellor Rishi Sunak looked odds-on to make it to the second round. There he is most likely to face a challenger from the populist right wing — most likely Foreign Secretary Liz Truss or Trade Minister Penny Mordaunt.”

“While Sunak has argued against any further near-term loosening of fiscal policy, Truss, Mordaunt and several others have argued for unfunded tax cuts, which would arguably be inflationary and would likely lead to more monetary tightening than would be the case under a Sunak premiership,” Daiwa said in a note Tuesday.

Wide-open race

The leadership contest has come about after Johnson resigned as party leader last week after months of controversy over his conduct while in office. His government has been plagued by scandals over parties during Covid-19 lockdowns and several party officials have been hit with sleaze allegations.

The final straw for many MPs who had previously supported Johnson, despite his less than conventional style of leadership, was his appointment of a deputy chief whip (responsible for party discipline) who had previous sexual misconduct allegations made against him of which Johnson was aware. That led to a wave of resignations with ministers and officials saying Johnson no longer commanded their confidence.

Describing Johnson’s departure as a “Bjexit,” Ian Bremmer, president of Eurasia Group, commented this week that “near term, U.K. policy is paralyzed by the caretaker government’s lack of a mandate (whether Johnson-led or under a new temporary prime minister” and that economic, foreign and defense policy are “essentially in stasis until there’s new leadership in the fall.”

British Prime Minister Boris Johnson makes a statement at Downing Street in London, Britain, July 7, 2022. 

Henry Nicholls | Reuters

“It’s a wide open race for the fall … but either way, Johnson’s two most important foreign policy initiatives—on Europe and on Ukraine — aren’t going to change. On the former, with Brexit and euroskepticism already firmly in place for the Conservative Party, there’s no lane for a softer Europe policy, even on the contentious Northern Ireland issue, among premiership competitors,” Bremmer noted on Monday.

European leaders, and particularly France’s President Emmanuel Macron, are happy to see the back of Johnson and will have less dysfunctional personal diplomacy with his successor, but the overarching U.K.-EU relationship will remain significantly strained, Bremmer added.

“That leaves plenty of uncertainty domestically— on fiscal easing and corporate tax policy for example. But I don’t see fireworks over who leads the United Kingdom driving much drama outside of old Blighty.”



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Kim Kardashian, Floyd Mayweather crypto scam lawsuit dismissed

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A federal judge on Wednesday dismissed a proposed class action lawsuit by investors against the founders of the cryptocurrency EthereumMax, as well as celebrity endorsers including Kim Kardashian and boxer Floyd Mayweather Jr. over their promotion of the cryptocurrency on social media.

Investors who bought EMAX tokens alleged they had suffered losses after taking the word of the celebrity influencers about the value of the crypto. The suit claims the defendants engaged in a conspiracy to artificially inflate the value of the EMAX tokens.

Judge Michael Fitzgerald wrote that he recognized that the lawsuit’s claims raised legitimate worries about “celebrities’ ability to readily persuade millions of undiscerning followers to buy snake oil with unprecedented ease and reach.”

“But, while the law certainly places limits on those advertisers, it also expects investors to act reasonably before basing their bets on the zeitgeist of the moment,” wrote Fitzgerald, of the Central District of California.

The judge found that the plaintiffs’ allegations were insufficiently backed, especially “given the heightened pleading standards” for fraud claims, according to his ruling in U.S. District Court in Los Angeles.

In addition to Kardashian, Mayweather and former Boston Celtics star Paul Pierce, the defendants in the case included Steve Gentile and Giovanni Perone, the co-founders of EthereumMax, and Justin French, a consultant and developer for the cryptocurrency, court documents state.

Fitzgerald in his ruling said he would allow lawyers for the plaintiffs to refile their suit after amending some of their claims under a number of the statutes cited in the original complaint, which included the Racketeer Influenced and Corrupt Organizations Act, also known as RICO.

“We’re pleased with the court’s well-reasoned decision on the case,” Michael Rhodes, a lawyer for Kardashian, told CNBC.

The dismissal came weeks after investors in fallen crypto exchange FTX filed a class-action lawsuit against former FTX CEO Sam Bankman-Fried and celebrity advertisers for the company, among them NFL superstar Tom Brady, for allegedly overstating the value of the crypto tokens in promotional messaging.

And the ruling came two months after Kardashian agreed to pay $1.26 million, and not to promote cryptocurrency for three years, to settle claims by the SEC for her failure to disclose a $250,000 payment touting EthereumMax on her Instagram account.

Fitzgerald in his ruling Wednesday said the EthereumMax lawsuit reflects a broader conflict surrounding celebrity and influencer promotional schemes.

“This action demonstrates that just about anyone with the technical skills and/or connections can mint a new currency and create their own digital market overnight,” Fitzgerald wrote in his dismissal.

Investors sued EthereumMax and its celebrity advertisers in January after a slew of influencers started snagging sponsorships to promote cryptocurrencies to their millions of social media followers.

Kardashian’s Instagram post in June 2021 had written, “Are you guys into crypto??? This is not financial advice but sharing what my friends told me about the Ethereum Max token.”

Her post included “#ad” at the bottom, indicating she had been sponsored. But it did not disclose her $250,000 payment from EthereumMax.

Mayweather promoted EMAX at a boxing match and a large Miami bitcoin conference in June 2021.

But by January, the cryptocurrency had lost 97% of its value.

Fitzgerald at a hearing last month indicated he was inclined to dismiss the case.

Bloomberg News, in an article about that hearing, said that an attorney for the plaintiffs in the suit asked the judge to allow him to revise the suit’s racketeering claims to show how the statements by the celebrity defendants harmed the investors.

“If plaintiffs had known the true facts related to the promoters’ financial interest in the tokens, and that they were being paid to shill these tokens, they wouldn’t have paid as much for the tokens as they did,” the attorney, John Jasnoch, told Fitzgerald, according to a transcript cited by Bloomberg.



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Cathie Wood says the Fed is making a serious mistake as bond market flashes worst signal since 1980s

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How the U.S. became a global corn superpower

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The United States has just about 90 million planted acres of corn, and there’s a reason people refer to the crop as yellow gold.

In 2021, U.S. corn was worth over $86 billion, according to calculations from FarmDoc and the United States Department of Agriculture.

According to the USDA, the U.S. is largest consumer, producer and exporter of corn in the world.

“We’re really good at [corn production],” Seth Meyer, chief economist at the USDA, told CNBC. “And that’s why you see big acres, big demand, export competitiveness.”

It’s not just what we eat.

“We turbocharged the value of corn through the application of science,” Scott Irwin, agricultural economist and professor at the University of Illinois, told CNBC.

Corn is in what we buy, including medications and textiles, and corn is turned into ethanol, which helps to fuel cars across the nation.

The rest of the world relies on U.S. corn, too. 

At $2.2 billion in 2019, corn is the most heavily subsidized of all crops in the country.

“A lot of these subsidies … do get embedded into the cost of farmland and they essentially bid up the price of farmland marginally,” Joseph Glauber, senior research fellow at the International Food Policy Research Institute and former USDA chief economist, told CNBC. “So the benefits accrue largely to those who own land.”

The federal crop insurance program’s net spending is forecast to increase to nearly $40 billion from 2021 through 2025, according to the Congressional Budget Office.

At the same time, farmland values have reached all-time record highs.

“Do we get the corn acres because we’ve got the support, or do we have the support because we have the corn acres?” Meyer said, posing the chicken-and-egg question about the nation’s grain superpower.

Watch the video above to learn more about how corn fuels the U.S. economy from its people to its vehicles, the power of the corn belt states, the role of subsidies and where government policy for the industry may go from here.



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