Andrew here. We are focused on what Kevin Warsh might say on Friday at his speech at the Jackson Hole Economic Symposium. Given the Fed chairman’s preference for a tighter-lipped institution, don’t count on market-moving fireworks — but we may get some tea leaves to read.

On this summer Friday, we’ve also got a little high-society potty talk: Corporate V.I.P.s at the U.S. Open are locked in a wild debate over how suites at Arthur Ashe Stadium have been stripped of their private bathrooms.

The big questions

Kevin Warsh, the Fed chairman, faces a big test on Friday: the first Jackson Hole Economic Symposium speech of his tenure, at 10 a.m. Eastern.

Warsh is under pressure from investors as inflation persists above the central bank’s 2 percent target. The war with Iran has made the Fed’s job tougher.

Some on Wall Street are warning that Warsh risks losing credibility just three months into the job if he doesn’t clearly address the issue on Friday.

Here are the big questions about Warsh:

Will he drop his aversion to offering guidance? The futures market on Friday expects the Fed to raise borrowing costs once this year. That would probably rankle President Trump, who has harangued the central bank to do the opposite. Fed officials and Wall Street economists are divided on what the central bank’s next policy move should be, even as new data shows inflation is going up.

Fed chairs often use the confab at Jackson, Wyo., to telegraph future moves. (Jay Powell, Warsh’s predecessor, did that last year with a speech that presaged rate cuts.) Will Warsh do the same?

How concerned is he about the bond market? At his last news conference in July, the Fed chairman signaled that rising bond yields might be doing the central bank’s job of tightening financial conditions. Investors responded by selling off government bonds, with the yield on the 30-year Treasury bond hitting a multidecade high.

Since then, Treasury Secretary Scott Bessent has announced multiple market interventions to keep bond yields lower, including bolstering the Japanese yen and increasing buybacks of long-dated Treasury notes and bonds.

But those moves appear to be at odds with the Fed’s growing focus on raising rates, and they could even box in the central bank on rate policy. Bessent has also played down the harms of inflation, potentially adding more friction with bondholders.

Will Warsh give a policy speech? Last month, he told reporters that he was undecided about the content of his speech but added that the chance to “frame the big questions” about productivity, demographics and the global economy seemed appealing. Fed watchers remain divided over whether he’ll even address inflation and bonds on Friday.

Passing up the opportunity could be a mistake. “He will have to deliver something that is clearer than the July press conference,” Torsten Slok, the chief economist at Apollo Global Management, told Bloomberg Television this week.

HERE’S WHAT’S HAPPENING

The U.S. is said to be in talks to take a stake in Venezuela’s oil fields. The Trump administration has had discussions about potential actions like taking a 100-year lease on multiple oil fields, Bloomberg reported, citing unnamed sources. Bloomberg also reported that Venezuela was considering leaving OPEC, the oil cartel, another possible major realignment in the world’s energy market.

Anthropic scores a key legal victory against the Trump administration. A district judge in California ruled that the administration unlawfully retaliated against the artificial intelligence giant in blacklisting it from working with the government. The move came after Anthropic spoke out about how its technology should be used in defense applications, and the judge said that violated the company’s constitutionally protected speech.

UEFA threatens to begin criminal proceedings against FIFA’s president. UEFA, the European soccer authority, accused Gianni Infantino of seeking a “fraudulently off-market price” for a since-abandoned plan to find outside investment for FIFA’s commercial arm. UEFA is seeking documents from those involved in the plan, including an offshoot of Thrive Capital, Josh Kushner’s firm.

Scoop: Funding for an independent coding start-up

Much of the attention on — and investor money for — artificial intelligence in recent years has gone to Anthropic and OpenAI. But other A.I. companies are gaining momentum.

Among them is the coding start-up Cognition, which is raising capital at a $46 billion valuation, two people with knowledge of the fund-raising told Mike Isaac and Sri Muppidi. (They weren’t authorized to speak publicly about the talks.)

The expected valuation would be nearly double what it was just three months ago, though the round is still being finalized.

Existing investors include 8VC, Founders Fund and Bain Capital Ventures.

Coding has become a big business as companies clamor for A.I. agent tools that can handle software development autonomously. Anthropic has surpassed $65 billion in annualized revenue and seen its valuation climb to $900 billion in large part because of the popularity of its Claude Code tool.

And OpenAI has shifted focus from its consumer chatbot, ChatGPT, to its Codex software engineering tool, whose users jumped to more than 20 million this month.

Cognition positions itself as an alternative to big A.I. labs. Its marquee product is Devin, an autonomous coding agent designed to help corporations manage complex software projects from start to finish. (Unlike some rivals, Cognition lets customers use other A.I. models for Devin as well as its own.)

The three-year-old company lists Goldman Sachs, Anduril and Mercedes-Benz as customers on its website.

• Since its last fund-raising, the company has roughly doubled its annualized revenue to more than $800 million this month, according to two of the people DealBook spoke to. (The Information and Bloomberg previously reported some details of the company’s fund-raising effort and financials.)

The coding space is crowded. Besides Anthropic and OpenAI, other coding businesses have been snapped up by tech giants:

• SpaceX purchased Cursor for $60 billion this month. (And SpaceX earlier this year acquired xAI, whose Grok also has coding tools.)

• Google struck a $2.4 billion deal with Windsurf for engineers and a nonexclusive license for its technology in July last year. (Cognition acquired what remained of Windsurf.)

Inside Kalshi’s effort to head off a New York State lawsuit

As prediction markets have exploded in size and popularity, so have their legal troubles.

The Times took an expansive look on Thursday at the disputes nationwide. But a close look at the run-up to one of these — New York State’s lawsuit against the prediction market Kalshi, filed last month — sheds light on the underlying issues, Michael de la Merced and Hurubie Meko report.

The context: The New York State Gaming Commission issued a cease-and-desist notice to Kalshi in October. The company then took to federal court to block efforts to enforce the state’s gaming laws, arguing that bets on its platform were regulated by the federal Commodity Futures Trading Commission, not state regulators.

By about June 16, Kalshi staff had been in touch with Gov. Kathy Hochul and her aides over ways to resolve the fight, according to people with knowledge of the matter, who weren’t authorized to publicly discuss the talks.

On July 8, a federal judge rejected Kalshi’s effort to prevent New York from enforcing its gaming laws.

Kalshi then devised several proposals to placate New York officials, including some centered on consumer protections like restrictions on advertising, according to a person with knowledge of the matter.

It also proposed creating a 6 percent tax on prediction-market revenue, similar to what North Carolina adopted last month. That is significantly lower than the 51 percent New York imposes on regular gambling bets, but Kalshi has argued that traditional sports books carry much bigger margins. The company estimated that the plan would have raised $10 billion in tax revenue for the state over five years, this person added.

On July 30, Kalshi’s head of federal government relations, John Bivona, spoke with the secretary to the governor, Karen Persichilli Keogh, and said that the prediction market was open to sweetening its tax proposal.

Keogh focused on the prospect of Kalshi obtaining a New York gaming license and whether states could pass consumer protection laws regulating prediction markets. Bivona insisted that Kalshi couldn’t agree to anything that would conflict with C.F.T.C. rules.

Hours later, New York State lawyers told Kalshi that its proposal didn’t address the state’s central concerns about obtaining a gaming license. Keogh subsequently told Bivona that the two sides were at an impasse.

Hochul’s team never viewed the interactions as a negotiation; instead, it saw them as an attempt by Kalshi to self-regulate, a second person with knowledge of the matter said.

Early on July 31, New York sued Kalshi.

Even now, the two sides frame the dispute very differently:

• Sean Butler, a spokesman for Hochul, told DealBook in a statement, “If a company willfully violates state law, they must face consequences.”

• Elisabeth Diana, a Kalshi spokeswoman, told DealBook in a statement that forcing the company to obtain a state license would conflict with federal law and would not be appropriate since the platform handles much more than sports betting.

Worth watching: whether New York will take on other prediction markets. In a statement, Diana asked why other companies, including Polymarket and Robinhood, hadn’t been sued.

Aside from Kalshi, James’s office has sued Coinbase and Gemini over their platforms. A spokesman for James’s office declined to comment.

A V.I.P. bathroom debate at the U.S. Open

What is destined to be the most heated rally at the U.S. Open this year among the C.E.O.s, bankers and lawyers packing the corporate suites? The battle of the bathrooms.

After a renovation of Arthur Ashe Stadium, every private restroom inside the luxury suites has been removed. This development, DealBook hears, is causing consternation for companies dropping upward of seven figures to lease a box for two weeks.

The great corporate bathroom debate has created two contingents:

• Team Renovation: Supporters argue the move opens valuable real estate inside the suites for more schmoozing. They acknowledge the old setup had its flaws — awkward maintenance interruptions, lingering smells and the agonizing fact that a thin door in a crowded, quiet suite offers little privacy.

We’ll have to wait and see how much the potty talk distracts from the tennis this year. The main draw begins on Sunday.

A.I. for small businesses

Artificial intelligence may seem like a tool reserved for the digital economy. But a start-up with big-name Silicon Valley backers aims to bring the power of A.I. to brick-and-mortar businesses.

Called Owner, the company pitches itself as a one-stop shop for small businesses to manage their online presence with the help of A.I. On Friday, the start-up is announcing a $240 million funding round at a valuation of $2.3 billion, Niko Gallogly is first to report.

Who’s investing: Goldman Sachs’ growth equity group led the round. Other participants included Meritech Capital Partners, Redpoint Ventures and Jack Altman, the brother of Sam Altman of OpenAI.

How it works: Owner uses A.I. agents to build websites, apps and marketing plans for small businesses. The company also makes online ordering systems for restaurants, allowing them to avoid paying commissions to third-party apps like DoorDash or Uber Eats.

Small businesses can use Owner “as their A.I. C.M.O. and C.T.O.,” Adam Guild, 26, the company’s co-founder and C.E.O., told DealBook.

Precocious origins: Guild began his business career at age 12, when he started a mobile game and Minecraft server company. He dropped out of high school in 10th grade to work on it full time when profit reached six figures.

A boldfaced benefactor: Guild started Owner in 2020, the same year he was awarded $100,000 from the Thiel Fellowship. It’s a grant program, started by the tech investor Peter Thiel, that pays young people to forgo college to pursue a start-up idea.

Owner attracted investments in earlier rounds from Fidji Simo, the former C.E.O. of applications at OpenAI; Kimbal Musk, the brother of Elon Musk; and Sam Bankman-Fried, the disgraced former leader of the cryptocurrency exchange FTX.

What’s next? Most of Owner’s customers are restaurants. With its new funding, Owner plans to expand its reach to businesses like salons, spas and gyms.

THE SPEED READ

Deals

• The buyout firm Advent International and the payment company Stripe are said to have abandoned their attempt to buy PayPal for more than $50 billion. (Bloomberg)

• Rupert Murdoch has weighed recombining his two media businesses, Fox Corp. and News Corp., according to court documents and a video about his family’s succession battle. (Reuters)

Technology and artificial intelligence

• OpenAI, Anthropic and scores of other companies argued that A.I. labs should provide their best tools to shore up critical institutions’ cyberdefenses. (NYT)

• A top United Arab Emirates royal, Sheikh Tahnoon bin Zayed Al Nahyan, is said to be a major investor in a forthcoming bank tied to the Trump family cryptocurrency venture. (WSJ)

Best of the rest

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