August 29, 2026

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Greetings. Your AC may still be running at full blast and the leaves may not have changed, but one telltale sign of fall emerged this week: the return of the Starbucks PSL. It’s the perfect drink to sip while buying all the Halloween decorations that have already been available at your local convenience store for weeks.

—Sam Klebanov, Matty Merritt, Molly Liebergall, Abby Rubenstein

In today’s newsletter, we’ll look at:

Kevin Warsh hinting at a possible rate hike
A deal for Venezuelan oil
The movie Warner Bros. tried to kill hitting theaters

Markets

Nasdaq

26,402.42

-0.52%

S&P

7,711.76

-0.25%

Dow

53,559.99

-0.02%

10-Year

4.720%

+5.0 bps

Bitcoin

$77,436.17

-3.46%

Gap

$23.48

+12.94%

Data is provided by

*Stock data as of market close, cryptocurrency data as of 6:00pm ET. Here's what these numbers mean.

Markets: Stocks slumped yesterday as investors digested Fed Chair Kevin Warsh’s big Jackson Hole speech (more on that below). But Gap rose like the spray from a bottle of Dream perfume after it picked a new CEO for Old Navy.

FOG OF WARSH

Fed’s Warsh hints that interest rates might go up

Photo of Kevin Warsh, a light-skinned man with short dark hair wearing a blue suit and tie, with his hands tented while walking in front of some foliage and forest off in the distance.

Natalie Behring/Getty Images

Just like a date who texted after ghosting you for three days, the tight-lipped Fed Chair Kevin Warsh finally opened up a little about what’s on his mind. Yesterday, he said that the Fed will have “work to do” if inflation doesn’t cool, during his widely watched keynote speech at the Fed’s yearly conference for central bankers in Jackson Hole, Wyoming.

Analysts translated this from Warshspeak as: Don’t be surprised by an interest rate hike soon, *wink wink.* The sound bites were the clearest signal Warsh has given about his outlook since becoming chair—even as he defended his view that the Fed should keep mum on its plans.

Inflation is top of mind

Warsh shared some revealing thoughts about the current economy:

He noted that inflation remains above the Fed’s 2% annual target and that he doesn’t see recent data showing it cooling as a meaningful improvement.
Warsh also said that the Fed should focus on inflation rather than the job market—which he deemed stable—and that rate hikes were the main tool to achieve price stability.

Wall Street took it as a sign that Warsh and co. are leaning towards raising borrowing costs. The trading odds of a rate hike at the Fed’s meeting next month jumped from 35% to 58% shortly after Warsh finished speaking, per CME Group data. Bond traders also priced in a rate hike: The yield on the 2-year government bond—which moves in the opposite direction to price and is closely correlated with the interest rates the Fed sets—rose from 4.24% to as much as 4.36% in the hours after Warsh finished speaking.

Meanwhile, the 30-year Treasury yield dipped slightly yesterday, after soaring to a 19-year high last week, which many experts saw at the time partially as a sign that investors doubted that the Fed was prepared to contain prices with interest rate hikes.

What’s next? The Fed will have one more inflation data reading to consider a few days before its September meeting to help it decide what to do with interest rates.

Big picture: While this was the furthest Warsh has gone to offer markets clarity about potential rate moves, he argued that too much communication can confuse investors, who he believes should guide Fed policy instead of the other way around.—SK

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World

Tour de headlines

oil rigs in Cabimas, south of Lake Maracaibo, Zulia State, Venezuela

Maryorin Mendez / AFP via Getty Images

🛢️ Trump says deal struck for US to control 65+ billion barrels of Venezuelan oil reserves. The US will have majority control of the oil “through a partnership with private business” and at “no cost” to the US taxpayer, President Trump said on Truth Social yesterday evening. He said the deal would “more than double” American oil reserves. Such an arrangement is unusual, and Bloomberg cautioned that it could be derailed if political winds shift in either country. The announcement comes as global oil supply has been disrupted by the war in Iran. The president has been discussing US access to Venezuela’s oil since arresting the country’s then-president Nicolás Maduro in January.

🛑 Stripe and Advent reportedly drop $50+ billion bid for PayPal. What might have been the largest fintech acquisition ever looks like it won’t be getting processed after all. Bloomberg reports that PE firm Advent and payment processor Stripe are walking away from their efforts to acquire PayPal, an OG in the payments space. They had reportedly offered more than $50 billion for PayPal. An earlier Wall Street Journal report said PayPal—which has a new CEO, and saw its stock rise amid news of the deal talk and a solid second quarter—had been seeking more money.

⚕️ Mounjaro gets approved to lower risk of heart events. The FDA approved Eli Lilly’s blockbuster GLP-1 medication Mounjaro yesterday to cut the risk of heart attack and stroke in adults with Type 2 diabetes. That expands the approved uses of the diabetes treatment as it continues to compete with Novo Nordisk’s diabetes and weight loss drugs. Novo’s Ozempic is already approved to treat cardiovascular disease, and its other drug Wegovy gained approval for lowering risks of cardiovascular events for overweight or obese adults without diabetes in 2024.—AR

THAT’S NOT ALL FOLKS

Wile E. Coyote gets his day in court (and onscreen)

Still from Coyote vs. Acme showing Will Forte and Lana Condor sitting in the front of a car as viewed through the windshield, with Wile E. Coyote sitting in the backseat, all looking shocked or concerned.

Warner Bros. Pictures and Ketchup Entertainment

After hitting a tunnel-painted wall three years ago, Coyote vs. Acme finally made it to theaters yesterday. Originally greenlit in 2020 by Warner Bros. Discovery, the film was shelved by the studio before the small distributor Ketchup Entertainment rescued it and released it this weekend to rave reviews.

It was a long road. The film, which follows Wile E. Coyote fighting the Acme Corporation for making shoddy products, cost Warner Bros. ~$70 million, and was already completed when new leadership decided to kill it in 2023 as part of a $115 million tax writeoff. But, unlike other projects the company was tossing, Coyote vs. Acme got stellar reviews from early screenings and critics. The backlash was almost immediate, with Warner Bros. saying it would sell the title to another company:

Last year, Ketchup said it would buy the worldwide rights to distribute the film for $50 million.
Then it got to work marketing it, using the real-life story of the movie’s almost-demise as a way to catch audiences’ attention.
The first teaser trailer was released in April and included digs like, “The Acme Corporation is releasing this film for accounting purposes only.”

How’s it looking? The movie has reeled in a solid $1.7 million in previews and is tracking for a $15 million opening weekend.—MM

Reader Poll

Do you plan to see Coyote vs. Acme?

Yes, it looks like fun.
Maybe, I am intrigued by the backstory.
Nope, not interested.
I’ll wait until it’s streaming.

This week’s question

What’s the most fun school assignment you’ve ever had to do?

Sam’s answer to get the juices flowing: “My sixth-grade English teacher had us spend three months reading about a notable person in order to write a lengthy biographical paper, dress up as them, and present their lives in a school-wide exhibit called the ‘living history museum.’ It felt like a social mixer that transcended centuries with Shaq, Joseph Stalin, and Renaissance painter Sofonisba Anguissola all hanging out in the same room.”

Submit your response here.

recs

How to watch thousands of movies online for free.
It’s not a trip to Europe, but you can visit a castle in every US state.
Fall baking projects to embrace the flavors of the new season.
A riveting true crime read about a Gulf Coast conman who weaponized the justice system in twisted ways.**

You’ve styled your space—scent is the missing element. Aura House’s cold-air diffuser elevates your home with fragrances that make it feel like a five-star hotel. Use BREW10 for 10% off.*

Market evolution: Currently, executives are having conversations around AI governance and closed-weight vs. open-weight models. Yep, new AI topics are taking center stage. We asked Jenny Koehler, COO of Advisory at PwC, why this is happening.*

^{*A message from our sponsor. **This is a product recommendation from our writers. When you buy through this link, Morning Brew may earn a commission.}

Play

Brew Crossword: Your sample clue from our biggest puzzle of the week is “Actor Nick who was People magazine’s Sexiest Man Alive in 1992.” Play the Crossword here.

Open House

Welcome to Open House, the only newsletter section that refuses to accept that frontier living is incompatible with a hot tub. We’ll give you a few facts about a listing and you try to guess the price.

Teton Board of Realtors/Realtor.com

Today’s property is a luxurious log house located on a gated ranch in Jackson, WY, about an hour’s drive from the lodge where central bankers pilgrimage for the Fed’s yearly symposium. The 10,988-square-foot main dwelling (plus 1,062-square-foot guest house) offers breathtaking views of the Teton Mountains and is a stone’s throw away from three national parks and the National Elk Refuge. Amenities include:

7 beds, 9 baths, and 37 acres
Pool, hot tub, and gym
Home theater and bar with cowboy-saddle seats

How much for this life of rustic affluence?

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Answer

$39.5 million

Word of the Day

Today’s Word of the Day is: symposium, meaning “a formal meeting at which several specialists deliver short addresses on a topic or on related topics.” Thanks to Theo from Ohio for the special suggestion. Submit another Word of the Day here.

Written by Abigail Rubenstein, Sam Klebanov, Matty Merritt, and Molly Liebergall

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☕ Warsh’s warning