FBI investigates China-backed VC fund

Good morning. In today’s newsletter:

• The ‘soap opera’ derailing Australian central bank reform

• Young Indians rack up credit card debt

• The FT’s US Election Game

But first, the FBI is investigating whether a China-backed US venture capital fund passed trade secrets to Beijing.

California-based Hone Capital, which launched in 2015 with $115mn of initial capital from a Chinese private equity group, invested in 360 US tech start-ups in less than three years.

The fund became one of Silicon Valley’s most prolific early investors, building stakes in driverless-car maker Cruise, payments group Stripe and aerospace engineer Boom.

The FBI is examining whether Hone Capital accessed information about the technology, finances or clients of start-ups for the benefit of its Beijing-based owner or Chinese authorities, said several people close to the matter.

Here’s what else we know about the probe, which comes as heightened geopolitical tensions between the US and China have rattled Silicon Valley’s venture industry.

And here’s what else I’m keeping tabs on today:

• Economic data: Singapore publishes its latest industrial production index and Malaysia report PPI data for August. Final second-quarter GDP data is due in the US.

• Japan: The Bank of Japan publishes its latest monetary policy meeting minutes.

• Ukraine leader in Washington: Volodymyr Zelenskyy will meet President Joe Biden at the White House and present him with a “Victory Plan” that he says will force Russia to the negotiating table.

Five more top stories

1. A political “soap opera” is threatening a once-in-a-generation reform of the Reserve Bank of Australia aimed at improving the central bank’s much-criticised record on monetary policy after a post-pandemic inflation surge. The reform would establish a separate monetary policy board within the RBA to decide interest rates. But the opposition Liberal party, which originally supported the plan, has turned against it.

2. Young Indians are racking up loan and credit card debt as they splurge on aspirational purchases from clothing to holidays, raising concerns about rising delinquencies and a wider lending slowdown. About a third of millennials and 40 per cent of Gen Z Indians are submerged under unsustainable borrowings, according to Freed, an Indian debt resolution platform.

3. Mira Murati, OpenAI’s chief technology officer who temporarily served as chief executive during the failed coup against founder Sam Altman, is leaving the company. It is the latest blow to the Microsoft-backed artificial intelligence start-up, which has had several high-profile departures this year.

4. Vladimir Putin has issued a stark threat to Ukraine’s Nato allies, saying he would expand Russia’s nuclear doctrine to potentially cover attacks against his country using advanced western missiles. Putin’s threats were a clear message to Ukraine’s western allies as the US and UK consider letting Kyiv hit targets deep inside Russia with Storm Shadow missiles. Here’s more on Putin’s revised nuclear doctrine.

5. The US and France were racing yesterday to secure a temporary truce between Israel and Hizbollah as Israel’s military chief told troops to prepare for a potential ground offensive in Lebanon. US President Joe Biden and his French counterpart Emmanuel Macron were involved in the diplomatic push at the UN General Assembly in New York, according to people briefed on the situation.

The Big Read

In the years since its founding in 2009, Uber instigated a transport revolution, spread its disruptive business model to a range of sectors and became one of the world’s most valuable private tech companies. On top of ride-sharing and takeaways, Uber’s couriers now deliver goods for retailers, putting it in ever more direct competition with Amazon. Is it trying to do too much?

We’re also reading . . . 

• Hizbollah: The Iran-backed militant group will not admit defeat, writes Kim Ghattas. But there is a short window for international diplomacy to find a face-saving formula that would allow Hizbollah to stand down.

• The end of the popular politician: A once-common type is vanishing from the west. Janan Ganesh argues it is a problem of demand not supply.

• European competitiveness: The EU tech industry is dire. But the problem is not lack of money, writes Martin Wolf.

Chart of the day

Chinese markets have given a short-term welcome to an “unprecedented” toolbox promised by Beijing to stabilise capital markets and revive animal spirits. But the bigger concern is whether the measures will be enough to stimulate the faltering real economy.

Take a break from the news

Can you mastermind a US presidential campaign? Compete against other FT readers in the Election Game.

Additional contributions from Gordon Smith and Tee Zhuo