Covid cases have soared in China’s capital city of Beijing, where many communities have been recently locked down or under tighter health monitoring as the country maintains its zero-Covid policy.
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BEIJING — Three indicators on China’s economy in October missed expectations and marked a slowdown from September, according to data released by China’s National Bureau of Statistics on Tuesday.
Retail sales fell by 0.5% in October from a year ago — the first decline since May — and industrial production grew by 5%, the data showed.
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Analysts polled by Reuters expected retail sales would slow to 1% year-on-year growth in October, and that industrial production would also slow to 5.2% growth.
Fixed asset investment for the first 10 months of the year grew by 5.8%, a touch below expectations for maintaining the same pace as September, with a 5.9% increase year-on-year, according to the Reuters poll.
Investment in real estate declined further in October on a year-to-date basis, while that in manufacturing slowed slightly from September. Investment in infrastructure picked up mildly, to 8.7% year-on-year for 2022 as of October.
The unemployment rate in cities was unchanged from September, at 5.5% in October. That of young people ages 16 to 24 was also unchanged, at 17.9%.
October’s drop in retail sales dragged down the year-to-date figure to just 0.6% growth. Home appliances, catering and apparel saw some of the greatest sales declines last month from a year ago.
Car sales held up with 3.9% growth. Online sales of physical goods surged by 22% year-on-year in October, to account for more than a quarter of retail sales overall, according to CNBC calculations of the data.
China’s economic recovery has slowed, said Fu Linghui, spokesperson for the National Bureau of Statistics, pointing to a slowdown in global growth and domestic Covid outbreaks.
He also said that the so-called three pressures on growth have intensified.
Nearly a year ago, Beijing warned the domestic economy faces “triple pressure” — from shrinking demand, supply shocks and weakening expectations. Consumption has been one of the weakest spots.
Fu noted signs of improvement in real estate, but said the sector remained on a downward trajectory.
Over the last few days, authorities have announced measures to support the struggling property market, according to financial media and official notices.
It’s uncertain whether the changes are enough, “but it’s clear that policymakers now have the courage to take more decisive actions,” Larry Hu, chief China economist at Macquarie, said in a report.
Data released ahead of Tuesday’s announcement revealed a negative turn in trade and domestic demand last month.
Exports dropped in October for the first since May 2020, while the producer price index fell for the first time in nearly two years. The core consumer price index, excluding food and energy, showed no change from September with muted 0.6% year-on-year growth in October.
Credit data disappointed, mainly due to the slump in the property market, Hu pointed out. He noted that household loans for the first 10 months of the year are less than half what they were a year ago.
Kim Kardashian, Floyd Mayweather crypto scam lawsuit dismissed
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.
Cathie Wood says the Fed is making a serious mistake as bond market flashes worst signal since 1980s
How the U.S. became a global corn superpower
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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