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Good morning. We’re here with the latest from the Democratic National Convention and the search for those missing from a yacht that sank off the coast of Sicily.
But first, we start with an exclusive report on PwC: the Big Four firm’s China operation has told clients it expects Chinese authorities to impose a ban on it for as long as six months, starting next month, as part of punishment for its audit of bankrupt property developer Evergrande.
The action against PwC comes after the China Securities Regulatory Commission said in March that Evergrande had inflated its mainland revenue by about $80 billion in the two years before it defaulted on debt in 2021, despite PwC China finding its financial statements to be clean.
The ban, which could come with huge fines, would be the toughest yet taken by Chinese regulators against a Big Four firm as the government steps up scrutiny of auditors’ role in financial scandals.
While the existence of PwC Zhong Tian, commonly known as PwC China, may not be threatened, it is clear how the ban will disrupt the firm’s operations.
And here are some other things I’m keeping an eye on today: There’s a lot of interesting stuff in there for monetary policy watchers.
Economic data: Flash purchasing managers’ indexes are released in the Eurozone, France, Germany, the UK and the US.
JACKSON HOLE: Top central bankers are gathering in Wyoming for their annual symposium, with all eyes on Federal Reserve Chairman Jay Powell’s speech tomorrow.
Central banks: The European Central Bank released the minutes of its last monetary policy discussion after records from the Fed’s July meeting showed most rate setters were ready to cut interest rates in September.
US Politics: Kamala Harris is set to conclude the final night of the Democratic National Convention in Chicago with her party’s acceptance speech for the presidential nomination. Read more from last night’s speech below.
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Five more top stories
1. Tim Walz denounced Republican candidate Donald Trump as bizarre and extreme and called on Americans to “rethink the Republican nominee.” Vice Presidential nominee Kamala Harris portrayed herself as a defender of freedom on the third night of the convention, which also featured Bill Clinton and Oprah Winfrey. See more from the Democratic National Convention in Chicago.
The fundraising race: Harris raised four times as much as Trump last month, $204 million, according to a Financial Times analysis.
Foreign policy: How will President Harris handle America’s changing position in the world order? Much will depend on how the low-profile operatives who have the vice president’s ear respond.
2. Five bodies have been found by divers searching the wreckage of Mike Lynch’s superyacht, the Bayesian, which sank off the coast of Sicily. Authorities have yet to confirm their identities. Four bodies were pulled from the sunken yacht yesterday, a fifth body has been found but has not yet been recovered, and a sixth remains missing. More information here.
3. Big tech companies are looking to convert old power plants into data centers as it becomes increasingly difficult to find suitable locations to provide enough power for their energy-hungry facilities. Decommissioned coal-fired power plants and other industrial facilities are “more complicated,” but they’re attracting the largest cloud computing service providers, here’s why.
4. Large US law firms are offering junior lawyers up to $50,000 for referrals as the war for talent flares up again. The amount of these offers is set to increase in 2021 and 2022, as a red-hot mergers and acquisitions market has revived demand for lawyers after a lull last year. Here are some law firms that are hiring again:
5. Trade unions are expected to press the UK government for a “pay restoration” to make up for a decade of real public sector pay cuts. The Trades Union Congress’ move would clash with the Labour government’s attempts to rein in the country’s strained finances. Here’s how much the union demands could cost the UK taxpayer:
Big Lead
© FT Montage; Dreamstime
The agriculture lobby is a widespread and complex organisation with vast funds, deep political connections and a sophisticated network of legal and public relations experts, which has secured huge subsidies and exemptions in the EU and the US. The industry claims to be protecting farmers’ livelihoods, but critics worry that its power gives it immunity on issues like pollution.
We also read and listen.
🎧 Deepfakes: How worried should you be about AI-generated images, video, and audio? Find out in the latest episode of the Tech Tonic podcast.
Climate and tourism: From repairing wildfire damage to heat waves impacting travel habits, climate change is shaking up the industry.
German Politics: The country’s most prominent far-left politician, Zahra Wagenknecht, blames herself for the government’s decision to limit military aid to Ukraine.
Declining population: An ageing and declining population will increase pressure on wages and pensions, but also present opportunities for investors, writes Simon Edelsten.
Today’s Chart
Western investors have resumed buying into gold in anticipation of cuts in U.S. interest rates this year, helping push the metal to a record high this week. Gold hit $2,531 a troy ounce in trading on Tuesday, boosting the precious metal’s gains this year by more than 20 percent, buoyed by institutional buying and bullish bets from hedge funds.
Take a break from the news
Who doesn’t love fried mushrooms? Not only are they a delicious and nutritious meal, but they also make beautiful, sculptural, surreal potted plants, writes Alice Lascelles.
Caley Brothers Grow Your Own Kit © Nicky Allen
Additional contributions by Emily Goldberg and Melody Abike Adebisi
