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Good morning, Today's Newsletter contains:
Ukraine blows up bridge to strengthen position in Russia's Kursk region
In an interview with the Financial Times, a senior Fed official supports “gradual” rate cuts
Democratic National Convention kicks off today as Democrats defend Kamala Harris' unpopular economic plan
But first, we look at the alarming increase in the failures of US startups, up 60 percent over the past year.
According to data from Carta, which provides services to private companies, 254 venture-backed clients went bankrupt in the first quarter of this year, and the current bankruptcy rate is more than seven times higher than in 2019, when the firm began tracking bankruptcies.
Millions of jobs are at risk at venture-backed companies, threatening ripples across the economy, which is why founders are starved for capital even as billions of dollars, including from major investors, flow into artificial intelligence companies.
What I'm focusing on today is:
Israeli Secretary of State Blinken: The US Secretary of State is due to meet with Prime Minister Benjamin Netanyahu before talks on a Gaza ceasefire agreement resume after an Israeli airstrike killed 10 people in Lebanon.
Germany: The Deutsche Bundesbank, CEPR and others kick off a two-day conference on financial market regulation in Frankfurt.
US presidential election: The Democratic National Convention kicks off in Chicago, with Kamala Harris, Joe Biden, Barack Obama and Bill Clinton all speaking this week. Read on for more on the challenges facing the Vice President.
In the latest US Election Countdown newsletter, FT journalists talk about what they're watching as they cover tonight's Democratic National Convention in Chicago. Sign up for the newsletter here.
Five more top stories
1. Democrats rushed over the weekend to defend Vice President Kamala Harris' unpopular economic plan, which she unveiled at a campaign event on Friday and promised to ban price gouging and provide new tax breaks for families and homebuyers, but was criticized as a “populist ploy” that doesn't do anything to fight inflation.
JACKSON HOLE: Investors will be closely watching the Federal Reserve's annual meeting this week for clues about the timing of an interest rate cut. Here's what to expect.
OPINION: The US central bank's next strategy review should consider shadow banking and the risk of sudden capital outflows, writes economist Rebecca Patterson.
2. Ukraine is blowing up bridges to fortify its positions in the Kursk region on the Russian border, but the Kremlin is struggling to muster the troops to drive them out. Kiev released a video over the weekend showing the destruction of two bridges over the Seym River, which analysts say will disrupt Russian military logistics. Here's the latest from the front line.
Invasion of Ukraine: Russia was slow to redeploy troops to repel Kiev's offensive at Kursk, instead assembling hastily assembled units including young and unwilling conscripts.
3. A senior Federal Reserve official supported gradual interest rate cuts ahead of the annual meeting of the world's central banks in Jackson Hole, Wyoming, this week. San Francisco Fed President Mary Daly told the Financial Times that recent data gave her “increased confidence” that inflation is under control.
4. Exclusive: The Securities and Exchange Commission was accused of censorship for forcing an academic to delay the publication of a paper for nine months. The investigation, based on three years of interviews, highlights criticism of the US audit regulator overseen by the SEC. Read more here.
5. A new survey of company filings shows that more than half of Fortune 500 companies see artificial intelligence as a potential risk to their business, up from just 9% in 2022. In contrast, of the 108 companies that specifically discussed generative AI, only 33 saw it as an opportunity. Industries of greatest concern include:
Big Lead
© FT Montage/Getty Images
The US Democratic Party will hold its convention today after quickly fielding a new presidential candidate. So far, the bet on Kamala Harris seems to be paying off. Vice President Harris has caught up with Donald Trump, outperformed the Republican candidate in some polls, and is raking in money from donors. But with the second phase of her campaign about to begin, Harris will struggle to maintain her growing support, but the hurdles are much bigger.
We are also reading…
US Military: As tech start-ups take an increasing interest in the defence sector, America's new military-civilian fusion offers both benefits and risks, writes John Thornhill.
UK Prisons: The UK's new Labour government inherited a dilemma: whether to curb the country's approach to longer sentences or increase prison space.
Advertising Giant: Walmart, the world's largest retailer, has built a huge advertising business that now competes with traditional media.
Italian politics: The vandalism of a mural of a gold medal-winning Olympic athlete born to African immigrants has sparked a fierce debate in Rome over the naturalization of children of immigrants.
Today's Chart
Western airlines have drastically cut flights to China as a combination of sluggish demand and the high costs of flying through Russian airspace weaken their ability to compete with local carriers.
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Take a break from the news
The FT and Schroders business book of the year shortlist has been announced. After sifting through and reviewing over 600 entries, they've selected 16 titles that they believe to be the “most compelling and enjoyable” business books of 2024. From Donald Trump's finances and Bill Gates' influence to the challenges of AI, here are the titles still on the shortlist.
© FT Montage
Additional contributions by Tee Zhuo and Sophie Spiegelberger
