Good morning. It's Wednesday, May 13th, 2026. This is The Morning Brief. I'm Jenny.

ANDREW: And I'm Andrew.

JENNY: April inflation came in hotter than economists expected, the hottest reading in almost three years, and the bond market did not take it well. We'll walk you through what that means for your mortgage rate this morning.

ANDREW: And the Senate is expected to take its final vote today confirming Kevin Warsh as the next chair of the Federal Reserve, just two days before Jerome Powell's term ends.

JENNY: Let's get into it.

ANDREW: A quick look at the markets. The S and P 500 slipped 0.16 percent to close at 7,400.96. The Dow eked out a small gain, up 56 points or about a tenth of a percent, ending at 49,760.56. The Nasdaq took the worst of it, down 0.71 percent to 26,088.20. The ten-year Treasury yield jumped roughly 5 basis points to 4.46 percent on the inflation print, and the thirty-year fixed mortgage rate is tracking near 6.4 percent this morning according to Bankrate, up from about 6.19 percent before the data hit. The selling was concentrated in tech and rate-sensitive names — a textbook hot-CPI reaction.

ANDREW: Let's start there, because everything else this morning runs through it. The Bureau of Labor Statistics reported April CPI rose 0.6 percent for the month, putting the annual headline rate at 3.8 percent. That's the hottest reading since May 2023, and it came in a tenth of a percent above the Dow Jones consensus. Core inflation, which strips out food and energy, rose 0.4 percent for the month and 2.8 percent over the year — also above forecast.

JENNY: So what's actually driving that? Is this the Iran story finally showing up in the data?

ANDREW: Largely, yes. Energy prices jumped 3.8 percent in a single month and accounted for more than 40 percent of the headline gain. Gasoline alone is up 28 percent over the year. That's the Hormuz blockade and the war risk premium working its way to the pump. But — and this is the part that worries the Fed more — shelter costs reaccelerated to 0.6 percent after several months of easing, and tariff-sensitive categories like apparel and airline fares are running hot. Airline fares are now up almost 21 percent year over year.

JENNY: Real wages?

ANDREW: Negative. Average hourly wages slipped half a percent for the month and are down 0.3 percent over the year in real terms. Paychecks are losing ground to prices for the first time in roughly two years.

ANDREW: Which brings us to Kevin Warsh. The Senate confirmed Warsh to a seat on the Federal Reserve Board last night by a 51-to-45 vote, almost entirely along party lines — Pennsylvania Democrat John Fetterman the only crossover. That was the easier vote. The separate vote to confirm him as chair is expected today, and Republican leadership has lined up the 30-hour clock to get it done before Powell's term as chair ends Friday.

JENNY: Walk us through why this matters today specifically, and not just in June.

ANDREW: Two reasons. First, Warsh inherits an inflation backdrop that just got materially worse, and the market wants to know on day one whether he's the hawk his record suggests or whether he'll defer to the data flow. Second, the Fed's next policy meeting is June 16th and 17th. Before yesterday's CPI, futures markets were roughly a coin flip on a June rate cut. After the print, the probability dropped sharply. Warsh's first public remarks as chair-designate will essentially set the tone for that meeting.

JENNY: And Powell himself — he's not gone Friday, right?

ANDREW: Correct. His term as chair ends Friday, but he remains a member of the Board of Governors and can stay on until 2028 if he wants. Whether he does is one of the open questions of the week.

ANDREW: The other big-picture national story is Iran. President Trump rejected Iran's latest ceasefire counter-proposal on Monday, called it, quote, a piece of garbage, and said the ceasefire is, quote, on massive life support. Shipping traffic in the Strait of Hormuz remained frozen yesterday. Brent crude settled at 107.77 dollars a barrel, up 3.4 percent. WTI closed above 102. The Saudi Aramco CEO warned this week that if Hormuz stays closed past mid-June, the oil market won't normalize until 2027.

JENNY: Which feeds right back into the CPI conversation we just had.

ANDREW: Exactly. The energy spike isn't an isolated shock anymore. It's becoming a persistent input into the inflation data, into rate expectations, into mortgage pricing — all of it.

JENNY: Speaking of mortgage pricing, that's a hard transition to Jenny, but here we are. Andrew, what's the rate move look like up close?

ANDREW: It's ugly. Mortgage News Daily had the thirty-year conforming rate at 6.19 percent Monday afternoon. Bankrate's daily average this morning is tracking near 6.45 percent. That's roughly a quarter-point move on a single inflation print, which is a very large one-day reaction.

JENNY: So if you locked your rate Monday morning, you got lucky. If you were planning to lock today —

ANDREW: You're paying real money for the delay. On a 400,000 dollar loan, a quarter-point move adds about 65 dollars to the monthly payment. Over the life of a thirty-year loan, you're talking roughly 24,000 dollars.

ANDREW: The Mortgage Bankers Association's latest weekly survey, for the week ending May 1st, showed applications down 4.4 percent overall, refinances down 5 percent. That data was collected before yesterday's CPI, so the next reading is likely to look worse. One detail from the MBA report worth noting — the FHA share of applications crept up again to 17.7 percent. That's a quiet signal that the buyer pool is increasingly tilted toward first-time and lower-down-payment borrowers, even as headline affordability gets worse.

JENNY: And on the regulatory side, anything moving this week?

ANDREW: Quiet on the regulatory front. The bigger near-term swing factor for rates is the Warsh tone, full stop. If he sounds hawkish in his first statement as chair, the ten-year yield could push toward 4.55 percent, and the thirty-year mortgage with it. If he signals data dependence, we may give some of yesterday's move back.

ANDREW: Jenny, over to you for Jacksonville.

JENNY: Weather-wise, Jacksonville is looking at a high near 75 today with showers and a chance of thunderstorms — 90 percent chance of rain, with another half to three-quarters of an inch expected. That's day two of the soaker we've been waiting on for months, and it is doing real work on the drought deficit, though we're still down more than two feet of rainfall over the longer term.

JENNY: To City Hall. The Winn-Dixie incentive package passed last night, 16 to 2. The council approved a 12 million dollar package — that breaks down to a 6.5 million dollar headquarters retention grant paid out over five years, plus up to 5.5 million in property tax rebates over twenty years. In exchange, Winn-Dixie commits to a 65 million dollar capital investment, retains 500 existing headquarters jobs, adds 200 new jobs at an average salary of 100,000 dollars by 2031, and — this is the part that almost derailed it — keeps the Harveys Supermarket in Brentwood open through at least February 2029.

ANDREW: The two no votes?

JENNY: Council President Kevin Carrico and Councilman Rory Diamond. Most of the floor debate centered on the food-desert question — whether eighteen months of guaranteed Harveys operation was enough for a neighborhood that has limited grocery options. The final deal stretched that commitment to roughly three years and put it in the ordinance language rather than a handshake, which is what got Carrico's earlier objections mostly addressed but, ultimately, not his vote.

JENNY: Separately, the council took another step on the JEA investigation. Members approved a 9,250 dollar contract with a firm called SelectionLink to survey current and former JEA employees about workplace culture. That's tied to ongoing accusations of a toxic environment under CEO Vickie Cavey. And on Monday, the special committee voted to seek subpoenas for Cavey, the chief administrative officer, and the former chief legal counsel. The full council could vote on authorizing those subpoenas as soon as May 19th.

ANDREW: That's a notable escalation.

JENNY: It is. And one more from the Jax Daily Record yesterday — the city introduced an ordinance to explore a 35 million dollar incentive package to bring a Culinary Institute of America campus to Jacksonville. The project had been moving under the code name Project Caymus. No vote yet; this is the opening of the formal evaluation.

JENNY: Andrew, anything from the Jaguars side worth a flag?

ANDREW: One date for the calendar. The NFL releases the full 2026 schedule tomorrow night at 7:30 Eastern. The Jaguars' opponents are already set — both AFC North and NFC East divisions, plus the AFC South rivals home and away — but the order, the prime-time count, and the bye week are what fans are waiting on.

JENNY: All right, let's pivot. The AI desk has two stories worth your time this morning.

JENNY: First — OpenAI launched a new initiative yesterday called Daybreak. It's an AI cybersecurity effort built on GPT-5.5 and the Codex coding model, and the framing is explicitly competitive. Daybreak is designed to find vulnerabilities, prioritize them, and then generate and test patches directly inside code repositories. The company says it reduces analyst review time from hours to minutes. The competitive context here is clear — Anthropic announced its Project Glasswing partnership last month with AWS, Microsoft, Google, JPMorgan Chase and others, and gated its offensive-capability Mythos model to a small group of approved organizations. Daybreak is OpenAI's answer.

ANDREW: Is this primarily an enterprise sales pitch or a genuine capability claim?

JENNY: Both, honestly. The enterprise pitch is real — large security operations centers are the most attractive AI customer right now because they have the budget, the labor cost pressure, and a clearly measurable workflow. But the underlying capability — finding and patching real-world vulnerabilities — is also where the labs are pushing hardest. Google issued a public warning Monday that it has caught hackers using AI to do exploit development in the wild. So the offensive-defensive race is genuinely on, and the frontier labs are positioning themselves as the defenders of choice.

JENNY: Second story — Anthropic is in advanced talks to acquire a developer tools company called Stainless. Reported price tag, at least 300 million dollars, per The Information. Stainless builds the software development kits that let companies plug AI models into their existing code — and notably, OpenAI and Google are among its current customers.

ANDREW: So Anthropic would be buying a piece of its competitors' developer infrastructure.

JENNY: Right. It's the kind of acquisition that doesn't make a flashy headline but matters a lot for how enterprise AI gets deployed. It also lands in the middle of Anthropic's reported 50 billion dollar fundraising round at a 900 billion dollar valuation. Acquisitions, hiring, and capacity build-out — that's where that money is going.

ANDREW: Before we let you go, one thing to watch today: the Senate vote on Kevin Warsh as Fed chair. The vote is expected sometime in the afternoon. The number to watch is the bond market reaction in the hour after it lands — specifically, the ten-year Treasury yield. If it pushes through 4.5 percent, expect mortgage rates to follow toward 6.5 percent by the end of the week. If yields hold or drift lower, yesterday's CPI shock may have already done the worst of the damage.

JENNY: That's your Morning Brief for Wednesday. Have a great day.

ANDREW: We'll see you tomorrow.

Good morning. It's Tuesday, May 12th, 2026. This is The Morning Brief. I'm Jenny.

ANDREW: And I'm Andrew.

JENNY: Kevin Warsh cleared his cloture vote in the Senate last night, putting him three days from inheriting the Federal Reserve from Jay Powell — and the April CPI print drops in about an hour.

ANDREW: And the Iran ceasefire is, in the President's own words, on life support — while right here in Jacksonville, the Winn-Dixie deal returns for a full council vote tonight with a very different store-closure picture than a week ago.

JENNY: Let's get into it.

ANDREW: A quick look at the markets. The S and P 500 closed at 7,412 yesterday, up about two-tenths of a percent — its first close above 7,400 in history. The Dow added 95 points to finish at 49,704, also up two-tenths. The Nasdaq inched up about a tenth to 26,274. Both the S and P and the Nasdaq set new records. The ten-year Treasury yield is sitting at roughly 4.39 percent, and the thirty-year fixed mortgage rate is tracking around 6.19 percent this morning according to Mortgage News Daily. A quietly bullish session, but the real move is probably waiting for the 8:30 CPI print.

JENNY: That's a lot pinned to one number. Andrew, take it from the top — over to you for national.

ANDREW: Let's start with the Fed. The Senate voted 49 to 44 last night to invoke cloture on Kevin Warsh's nomination, clearing the procedural hurdle on his path to replacing Jay Powell as Federal Reserve chair. Roll Call is reporting Warsh still needs a separate up-or-down vote on the chair role specifically, but Republican leadership says they expect to finish both votes this week. Powell's term as chair ends Friday, May 15th — although he's confirmed he'll remain on the Fed's board for a period of time after stepping down.

JENNY: So this really does happen by Friday.

ANDREW: It really does. And the market read is already in motion. Warsh has spent months signaling a less interventionist Fed and a higher tolerance for letting market mechanisms work — which is code for cutting more aggressively if growth softens, and refusing to lean against fiscal policy. Traders are pricing in roughly a coin-flip on a June rate cut. The bigger question is whether his confirmation tone shifts the June FOMC meeting.

JENNY: And that brings us right to 8:30 this morning.

ANDREW: It does. The Bureau of Labor Statistics drops the April Consumer Price Index at 8:30 Eastern. Bloomberg consensus is 3.7 percent on the headline, year over year, up from 3.3 percent in March, and 2.7 percent on core. Two wrinkles. One — the oil-price spike from the Iran war should push the headline number higher. Two, and this one matters more, BLS is rolling in a delayed adjustment on owners' equivalent rent that was held flat back in October during the government shutdown. So expect noise in the core number that has nothing to do with the underlying inflation trend.

JENNY: How are desks set up?

ANDREW: The pain trade for the bond market is anything above 3.8 on headline or 3.0 on core. That puts the June rate-cut conversation in real trouble before Warsh even sits down. Anything cooler than expected, and the ten-year — and the thirty-year mortgage along with it — has room to grind lower into the summer.

ANDREW: Speaking of the war driving that oil spike — President Trump told reporters in the Oval Office yesterday that the U.S.-Iran ceasefire is, quote, on life support. He rejected Iran's counter-proposal Sunday night, calling it, quote, a piece of garbage. CNN and Bloomberg are both reporting that some Trump advisers say he is now seriously considering a return to major combat operations. Shipping traffic through the Strait of Hormuz remained effectively frozen yesterday.

JENNY: And the President leaves for Beijing on Thursday with all of that still open.

ANDREW: He does. Trump and Xi meet Thursday and Friday — the first state visit to China by a sitting U.S. President since Trump's own 2017 trip. CSIS is calling the summit "modest in ambition." Iran is expected to dominate the agenda, given how much Iranian oil China has historically imported. Watch for a Boeing aircraft purchase announcement and language on rare-earth access — those are the realistic deliverables. A comprehensive tariff deal is not on the table.

JENNY: Andrew, while we're on rates — what's the picture on home lending this morning?

ANDREW: Mortgage rates are basically holding their breath alongside the rest of the bond market. Mortgage News Daily has the thirty-year conforming average at 6.19 percent this morning, down six basis points from yesterday. Freddie Mac's weekly survey, which lags, came in at 6.37 percent last week, up from 6.30 percent the week before. The Mortgage Bankers Association reported overall applications down 4.4 percent for the latest week, with the refinance index off 5 percent — but here's the part that caught my eye — the average purchase loan size hit a record $467,300.

JENNY: A record purchase loan size in a 4.4 percent down week. What does that tell us?

ANDREW: It tells us who's left in the market. The marginal buyer right now is the higher-income, less rate-sensitive buyer — the move-up family with substantial equity, the retiree relocation, the high-net-worth second home. First-time and starter-home demand has been hollowed out by affordability for the better part of a year. The MBA composition data backs that up — the FHA share is creeping up, which usually means the lower-income buyers who are still in the market are stretching to the most leveraged products available to them.

JENNY: So a rate cut doesn't fix that quickly.

ANDREW: It doesn't fix it, no. But it does change the math at the margin. Desks I talk to are modeling that if Warsh is confirmed Thursday or Friday and strikes a dovish tone in his first remarks, we could see 5 to 10 basis points off the ten-year and roughly the same on the thirty-year. That's not a refi-wave-triggering move, but it would matter for anyone trying to lock this week.

ANDREW: One more thing on the regulatory side — the Consumer Financial Protection Bureau continues to operate at reduced staffing under the administration's restructuring, and HousingWire is reporting that lenders are watching for any rule changes coming out of FHFA on conforming loan limits later this quarter. Quiet on that front this morning, but it is a story that matters in the back half of the year.

JENNY: Got it. Let me take us to AI — there were two real developments yesterday that I think tell a bigger story together.

JENNY: First, Google issued what it's calling a dire warning yesterday, saying it has caught hackers using AI to break into computer systems. Fortune is reporting that Google's threat intelligence team has documented real-world deployments of AI tools to discover and exploit software vulnerabilities. And that comes the same week that Anthropic is gating access to its new Mythos model — which Anthropic itself says is so strikingly capable at offensive cybersecurity work that the company won't release it publicly, even to paying customers, beyond a small group of approved organizations.

ANDREW: So we're now in a world where the labs are publicly saying their own models are too dangerous to ship.

JENNY: Exactly. And on the defense side, Anthropic's Project Glasswing — launched in April — has been quietly expanding. The launch partners include AWS, Apple, Broadcom, Cisco, CrowdStrike, Google, JPMorgan Chase, the Linux Foundation, Microsoft, Nvidia, and Palo Alto Networks. Anthropic is putting up to $100 million in usage credits and $4 million in donations behind it. The framing is, essentially, we built the weapon, here is the consortium to build the shield.

ANDREW: And how is OpenAI playing this?

JENNY: Differently. CNBC is reporting that OpenAI announced yesterday it will give the European Union early access to a variant of its newest model called GPT-5.5-Cyber. That's the same capability lane Anthropic is gating. OpenAI is choosing transparency through government access where Anthropic is choosing restriction. Both are defensible — but it means enterprise buyers are now picking vendors on AI policy posture, not just capability.

ANDREW: Which is exactly the conversation our lending and banking clients are having this quarter.

JENNY: It is. One quick aside on Anthropic itself — the Financial Times and TechCrunch are both reporting that the company's $50 billion funding round at a $900 billion valuation is in advanced stages. Anthropic asked investors to submit allocations within 48 hours. A board decision is expected this month. Revenue run rate is reported at $44 billion as of early May, up from roughly $9 billion at the end of 2025.

ANDREW: 9 billion to 44 billion in five months. That's a number that makes you do a double take regardless of where you sit on AI.

JENNY: It is. Andrew, let me bring us home to Jacksonville.

JENNY: Weather-wise, Jacksonville is looking at a high of 75 degrees today with rain in the forecast. The National Weather Service has the chance of precipitation at 90 percent, with a half to three-quarters of an inch possible, and the possibility of thunderstorms this afternoon. After more than 25 inches of cumulative rainfall deficit, this is the first meaningful soaking the city has seen in months. The burn ban remains in place, but this is the start of the break we've been waiting for.

JENNY: City Council takes up the Winn-Dixie incentive package tonight at 5 p.m. The Jax Daily Record is reporting that Council leadership and Winn-Dixie have reached an agreement that keeps the Harveys Supermarket on West 48th Street open through February 2029, when its lease is set to expire. That Harveys closure was the sticking point that derailed the Finance Committee vote a week ago — residents argued the closure would create a food desert in Northwest Jacksonville.

ANDREW: So the 12 million is back on the table.

JENNY: It is. To recap — up to $12 million in incentives, made up of a $6.5 million headquarters retention grant paid out over five years and roughly $5.5 million in city property tax rebates over twenty years. In return, Winn-Dixie keeps its 500 existing headquarters jobs at Edgewood Court, adds 200 more by the end of 2031 at an average salary of at least $100,000, and commits $65 million in improvements — about $17 million at the headquarters and $48 million across its Jacksonville stores. First Coast News is reporting the Brentwood-store commitment is now baked into the ordinance language, not a verbal handshake.

ANDREW: That's a real shift from where this was last Tuesday.

JENNY: It is. And the politics matter — this is the kind of deal that signals to other corporate headquarters in the region that Council will hold a hard line on community-impact concessions, but will close the deal when the company shows up at the table.

ANDREW: And on the Jaguars front?

JENNY: One quick note. The NFL releases the full 2026 schedule Thursday night at 7:30 Eastern. The Jaguars already know their opponents, but not the order. The team plays eight home games at EverBank Stadium, with capacity dropped to 42,507 while the Stadium of the Future is under construction. There are two London games back-to-back, and the Pittsburgh game has been moved to Orlando. Construction of the new stadium targets August 2028 completion, which means the team plays the entire 2027 season on the road.

ANDREW: Before we let you go, one thing to watch today: the April Consumer Price Index, released by the Bureau of Labor Statistics at 8:30 Eastern. Consensus is 3.7 percent on the headline, year over year, and 2.7 percent on core. The housing piece will swing the core number because of last fall's owners' equivalent rent adjustment getting backfilled, so expect noise. The clean read to watch: anything north of 3.8 on headline or 3.0 on core, and the June rate-cut conversation gets a lot harder for Kevin Warsh on what may literally be his first day on the job. Anything cooler, and the ten-year — and the thirty-year mortgage with it — has real room to move.

JENNY: That's your Morning Brief for Tuesday. Have a great day.

ANDREW: We'll see you tomorrow.

Good morning, and welcome back from the weekend. It's Monday, May eleventh, 2026. This is The Morning Brief. I'm Jenny.

ANDREW: And I'm Andrew.

JENNY: Iran's long-awaited response to the ceasefire proposal landed Sunday night, and President Trump rejected it within hours, calling it, in his words, totally unacceptable. The strait is back on a knife's edge as Wall Street opens this week.

ANDREW: And the Senate holds its first real vote on Kevin Warsh as Fed chair tonight at five thirty Eastern, with Powell's term running out on Friday. We'll get to what that means for mortgage rates.

JENNY: Let's get into it.

ANDREW: A quick look at the markets. The S and P 500 closed Friday at 7,399, up about eight tenths of a percent and another record. The Dow finished essentially flat at 49,609, up just 12 points. The Nasdaq jumped 1.7 percent to 26,247, also a fresh high. The ten-year Treasury yield sits at 4.38 percent. And the thirty-year fixed mortgage rate is tracking around 6.33 percent according to Optimal Blue, with Freddie Mac's weekly survey at 6.37. The big mover Friday was the April jobs print, 115,000 payrolls, roughly double what economists expected, and that's what nudged yields higher into the weekend.

ANDREW: Weekend at a glance. Iran delivered its long-awaited counter-proposal via Pakistan on Sunday, and President Trump rejected it on social media within hours. Drones hit Kuwait and the United Arab Emirates Friday and Saturday. And Anthropic is reportedly closing in on a 900 billion dollar valuation. We'll take them in order.

ANDREW: Let's start with Iran, because everything else this week reads through that story. Iran's foreign ministry delivered its response to the one-page U.S. memorandum on Sunday via Pakistani mediators. The response was not a yes. According to Iran's Tasnim news agency, Tehran is now demanding an end to the war on all fronts, and that explicitly includes Lebanon, where Israel is still fighting Hezbollah. Iran also wants the U.S. blockade on Iranian ports lifted, sanctions on Iranian oil sales removed, and frozen assets unfrozen. Trump posted to social media late Sunday that the response was, quote, totally unacceptable, in capital letters.

JENNY: So Andrew, what is the practical risk this week? Does this go hot again?

ANDREW: That's the question oil traders are wrestling with at the open this morning. Two things to watch. First, Trump warned last week that if no deal was reached, strikes would resume at, his words, a much higher level and intensity. That language is now activated. Second, over the weekend drones targeted Kuwait and the United Arab Emirates, both U.S. allies, and a commercial cargo ship caught fire in the Gulf. Iran's Revolutionary Guard had already warned of a heavy assault on Saturday. None of that means strikes happen today, but the ceasefire is functionally suspended until either Iran moderates its position or the U.S. moves militarily. Crude futures are the proxy to watch this week.

JENNY: And just to remind listeners, the Strait of Hormuz carries roughly a fifth of the world's seaborne oil. The whole point of Trump's one-page memorandum was to lock in reopening the strait first and push the harder nuclear questions into a 30-day negotiating window. Iran's counter is essentially: we'll talk about Hormuz, but only if you also pull back from Lebanon and unwind the entire sanctions architecture. That's a much bigger ask, and it's the gap Trump rejected last night.

ANDREW: Exactly right. And the maritime piece is why this matters even if the shooting stays limited. Insurance premiums on Gulf shipping are already up sharply since the skirmish last Thursday off Qeshm Island. Every additional drone strike, every fast-boat incident, ripples through tanker rates, then into refined product prices, then into the C-P-I print in two months. The Fed knows that. Warsh knows that. It's part of why tonight's vote matters.

JENNY: And this lands right before Trump's trip to Beijing.

ANDREW: It does. President Trump leaves for China Thursday for a two-day summit with Xi Jinping on the fourteenth and fifteenth. Iran complicates that meeting because Beijing buys the majority of Iranian oil and has been a brake on tougher U.N. action. The Center for Strategic and International Studies is calling the summit modest in ambition. Don't expect tariff breakthroughs. The November trade truce is intact through this fall, but no new deal is on the table. Trump arrives in Beijing knowing the Iran file is still open.

ANDREW: One more national thread to flag. Friday's April jobs report came in at 115,000 nonfarm payrolls, well above the 55,000 economists had penciled in. Unemployment held at 4.3 percent. Health care added 37,000 jobs, transportation and warehousing 30,000, retail 22,000. Federal government employment kept shrinking. Wage growth was a soft two tenths of a percent month over month. Bloomberg notes this is the first back-to-back monthly gain in nearly a year, but the trajectory is still well below late-2025 levels.

JENNY: That actually sets up the mortgage conversation, doesn't it.

ANDREW: It does, and that's where we're going next. The stronger jobs print pushed yields higher Friday, and we have the Warsh cloture vote tonight. The thirty-year fixed is sitting at 6.33 percent on Optimal Blue, 6.37 on Freddie Mac's weekly survey last Thursday. Two weeks ago that number was 6.30. So we've ticked back up modestly.

JENNY: And the Warsh vote tonight changes the calculus how?

ANDREW: Tonight at five thirty Eastern, the Senate votes on cloture for Kevin Warsh's nomination as Fed chair. Republicans hold 53 seats. Senator Fetterman has signaled he'd vote yes. The Banking Committee advanced him 13 to 11 on April 29th along strictly party lines, the first fully partisan committee vote on a Fed chair nominee in modern memory. Confirmation has to clear before Powell's term as chair expires Friday, May fifteenth. If Warsh gets through tonight, final confirmation likely lands midweek.

JENNY: And the bond market reaction, is that priced in already?

ANDREW: Mostly priced in, but not entirely. Warsh is viewed as marginally more hawkish than Powell on inflation and somewhat more open to letting market forces dictate rate paths. Mortgage strategists I read this weekend think a confirmed Warsh is worth roughly five to ten basis points of upward pressure on the ten-year, which translates into maybe a tenth of a point on the thirty-year fixed. The bigger swing factor for buyers is whether Warsh's first Fed policy meeting in June leans toward holding or signaling cuts. We'll know within four weeks of confirmation.

JENNY: So practically, if you're closing on a house this week?

ANDREW: If you have a rate lock that expires before Friday, you've probably ridden out the worst. If you're shopping fresh quotes, today and Tuesday are the noisier days. The Mortgage Bankers Association reported applications fell about four and a half percent last week, with the average purchase loan size hitting a record 467,300 dollars. That number tells you affordability is still the binding constraint, not rates moving a few basis points.

ANDREW: Jenny, over to you on the AI side.

JENNY: Thanks, Andrew. The big AI headline going into the weekend, and you flagged it, Anthropic is in talks to raise as much as 50 billion dollars at a valuation approaching 900 billion. The Financial Times broke the story Thursday, and TechCrunch confirmed multiple preemptive bids in the 850 to 900 billion range. If that closes, it would put Anthropic ahead of OpenAI's 852 billion post-money valuation from earlier this year.

ANDREW: What's driving that? Just enterprise momentum?

JENNY: Mostly the revenue numbers. Anthropic's annual run rate is now north of 30 billion dollars, possibly closer to 40, versus roughly 9 billion at the end of last year. That is fivefold revenue growth in less than 18 months, driven primarily by enterprise deals like the JPMorgan, Goldman, Citi, and Visa deployments, and the Microsoft 365 integration we covered last week. A board decision on whether to take the round is expected this month. And it may be Anthropic's final private raise before an I-P-O. Bloomberg is reporting that could come as early as October.

ANDREW: An October listing at near-trillion-dollar valuation would be one of the largest tech debuts ever.

JENNY: It would. For context, when OpenAI's 122 billion dollar round closed earlier this year, it was the largest private round in history. Anthropic is now negotiating a round bigger than that, and the lead bidders include some of the same names that just put a billion and a half dollars in via the Blackstone-Goldman joint venture two weeks ago. The capital concentration in two labs is becoming the story.

JENNY: Quick update on the government pre-release testing front. The Commerce Department's AI standards office confirmed last week that Google DeepMind, Microsoft, and xAI have all signed on for pre-release model evaluation, joining OpenAI and Anthropic. Every major U.S. frontier lab is now in that program. First public test reports are expected this summer.

ANDREW: And on the deployment side, the Anthropic-F-I-S Financial Crimes agent we covered last week, that's the anti-money-laundering tool, now has named pilot banks. B-M-O and Amalgamated are first up, with a broader rollout penciled in for the back half of this year. The selling point is collapsing investigations from hours to minutes, and it's the first piece of the agent stack that has a clean compliance audit trail. Worth watching whether one of the top-four U.S. banks goes public on a deployment in the next 60 days.

JENNY: That's a real test of whether the enterprise momentum is durable or whether it's mostly headline announcements.

JENNY: Andrew, that's it from the AI desk. Let me bring this home to Jacksonville.

JENNY: Weather-wise, Jacksonville is looking at a high near 86 degrees today, with patchy morning fog and an 80 percent chance of thunderstorms moving in after three in the afternoon. And here is the headline. That is real, organized rain for the first time in months. The cold front pushing through this afternoon is expected to drop up to an inch in spots, and the unsettled pattern lingers into Wednesday.

JENNY: That matters because Northeast Florida is still in exceptional drought. The rainfall deficit in Jacksonville proper is over 25 inches, and Florida had burn bans in 50 of 67 counties as of last week. Duval County's burn ban is still in effect this morning, and emergency officials are not lifting it on the first wet afternoon. But the fire risk profile changes meaningfully if Tuesday and Wednesday deliver.

ANDREW: How much rain would actually meaningfully dent the deficit, Jenny?

JENNY: Hydrologists at Jacksonville Today are saying it would take six to eight inches of sustained rainfall over the next several weeks to materially change the drought designation, not just one front. So today's storms are a real start, but anyone hoping the burn ban lifts this week is going to be disappointed. The more practical near-term win is air quality. Wildfire smoke from out-of-county fires has been bumping particulate readings into the moderate range for sensitive groups, and a steady rain will scrub that out by Wednesday.

ANDREW: Jenny, big local council vote coming up tomorrow, right?

JENNY: Yes, and this is the one to watch locally. The Jacksonville City Council takes up Ordinance 2026-326 tomorrow night, the 12 million dollar incentive package for Winn-Dixie's headquarters. The Finance Committee deferred it on May fifth over the company's plan to close the Harveys Supermarket on West Forty-Eighth Street in Brentwood. Councilmember Pittman has been working with the company on language that would tie the incentive to keeping that store open beyond an 18-month relocation window. The Jax Daily Record is reporting Winn-Dixie has agreed to that condition verbally, but the question tomorrow is whether the open-store stipulation lands in the actual ordinance text or stays a handshake.

ANDREW: Stakes if it fails?

JENNY: 200 jobs at roughly 100,000 dollars average. A 65 million dollar capital expenditure tied to the headquarters site. And, depending on how Winn-Dixie's German parent company reads the signal, a question about whether Jacksonville stays competitive for the next mid-sized corporate relocation. First Coast News is also reporting that the parent company's role in the deal is getting more scrutiny than it had two weeks ago. Council convenes at five in the evening tomorrow.

JENNY: One more local note. The Jaguars wrapped rookie minicamp Saturday at the Miller Electric Center. Coverage out of News4Jax suggests the offensive coaches are leaning into multi-tight-end sets this year, a response to last season's explosive plays allowed against Seattle and the Rams. The receiver room is still Travis Hunter, Brian Thomas Jr., Jakobi Meyers, and Parker Washington. No major roster surprises out of the weekend.

ANDREW: And the stadium piece in the background?

JENNY: Still on track for the 2026 home slate. EverBank capacity sits at 42,507 with the 400 Level upper bowl offline for construction. Eight games at EverBank, two in London back-to-back, and the Pittsburgh game in Orlando at Camping World. Season ticket retention numbers will start to leak this month, and that is the real economic indicator on whether the Stadium of the Future bet is holding the fan base.

JENNY: Andrew, the close is yours.

ANDREW: Before we let you go, one thing to watch today. The Senate cloture vote on Kevin Warsh at five thirty Eastern. Three reasons it matters beyond the headline. One, if any Republican defects, the bond market will reprice the entire summer rate path Tuesday morning, and your mortgage quote will move. Two, Warsh's first Fed policy meeting is in June, and his confirmation tone tonight will telegraph whether he sees the April jobs print as reason to hold or reason to start cutting. Three, Powell's term expires Friday, and there is no plan B if cloture fails. Watch the Senate floor at five thirty. The market will be watching too.

JENNY: That's your Morning Brief for Monday. Have a great start to the week.

ANDREW: We'll see you tomorrow.

Good morning. It's Friday, May 8th, 2026. This is The Morning Brief. I'm Jenny.

ANDREW: And I'm Andrew.

JENNY: The April jobs report drops at 8:30 Eastern this morning, and Wall Street is bracing for what could be the slowest hiring number in nearly a year — about sixty-five thousand net new jobs.

ANDREW: And U.S. and Iranian forces traded fire across the Strait of Hormuz yesterday, even as President Trump insists the ceasefire is holding and Tehran says it is still drafting a response to the peace memo on the table.

JENNY: Let's get into it.

ANDREW: A quick look at the markets. The S and P 500 closed Thursday at seven thousand three hundred sixty-five, up one and a half percent — another record. The Dow added six hundred twelve points to finish just shy of forty-nine thousand nine hundred eleven, a gain of one point two percent. The Nasdaq jumped two percent to twenty-five thousand eight hundred thirty-nine, its best session in two weeks. The ten-year Treasury yield sits at 4.34 percent, and the thirty-year fixed mortgage rate is tracking right around 6.34 percent according to Mortgage News Daily. Futures this morning are slightly higher as traders wait for the payrolls print.

ANDREW: Let's start with the strait. Yesterday morning, three U.S. Navy destroyers were transiting the Strait of Hormuz when, according to Central Command, Iranian forces launched missiles, drones, and fast boats at the ships. The U.S. responded by hitting what it called Iranian military facilities. Tehran says American strikes hit civilian areas on Qeshm Island and along the southern Iranian coast. President Trump publicly called the exchange — quote — just a love tap, and insisted the ceasefire is still in effect.

JENNY: Wait — they're shooting at each other and the ceasefire is still on?

ANDREW: That is the position the White House is taking. The bigger story underneath the skirmish is that one-page memo we have been tracking all week. Fourteen points, brokered by Steve Witkoff and Jared Kushner through Pakistani mediators. It would formally end the war and open a thirty-day window to negotiate Hormuz access, sanctions relief, and limits on Iran's nuclear program. Iran's foreign ministry said yesterday Tehran is still reviewing the proposal and — quote — has not reached a conclusion. Trump warned that without a deal, strikes will resume at a, quote, much higher level and intensity.

JENNY: So what does the market actually think happens?

ANDREW: Crude is down, equities are at records, and that tells you traders are pricing in a deal. If Iran rejects, expect both of those moves to reverse fast.

ANDREW: Now to this morning's other big story. At 8:30 Eastern, the Bureau of Labor Statistics releases the April jobs report. The consensus on Wall Street is roughly sixty-five thousand net new jobs — that would be the slowest hiring pace since last summer — with the unemployment rate holding at 4.3 percent. ADP's private-sector read on Tuesday came in at one hundred nine thousand, slightly above expectations, which has some economists nudging their headline number higher.

JENNY: And what does that do to the Fed picture?

ANDREW: It complicates it. A weak print pulls the rate-cut conversation back into the market. A strong print, combined with sticky energy prices from the Iran standoff, gives Kevin Warsh a more hawkish opening hand if he is confirmed next week. And we will come back to that confirmation vote in the close.

ANDREW: Jenny, that ten-year yield I mentioned at the top is exactly where the home-lending story picks up this morning.

JENNY: Take it away.

ANDREW: Mortgage rates are sitting right around 6.34 percent on the thirty-year fixed this morning, per Mortgage News Daily. That is down a few basis points from yesterday and well off the highs we hit two weeks ago when the Hormuz crisis first spiked crude oil. Freddie Mac's weekly PMMS print — the more conservative benchmark — is at 6.30 percent. We get a fresh PMMS at noon Eastern.

JENNY: Did the recent rate spike actually slow people down out there?

ANDREW: It did. The Mortgage Bankers Association reported Wednesday that applications fell four point four percent for the week ending May 1st. Purchase applications down about four percent, refinances down five. The MBA's tracked rate jumped to 6.45 from 6.37 the prior week — that is the spike showing up in the data. Here is the interesting wrinkle, though. The average purchase loan size hit a record four hundred sixty-seven thousand three hundred dollars. The buyers still active right now are buying expensive homes.

JENNY: So the affordability squeeze is selecting for high-end buyers.

ANDREW: Exactly. The bottom of the market is sitting on the sidelines waiting for rates to come back down. And how fast that happens depends almost entirely on what Iran does in the next week.

ANDREW: One more on home lending. FIS — the big bank technology vendor that runs the back office for thousands of banks and credit unions — announced this week a partnership with Anthropic to bring agentic AI directly into bank operations. The first product is a Financial Crimes agent that compresses anti-money-laundering investigations from hours down to minutes. BMO and Amalgamated Bank are the first named deployments, with broader availability planned for the second half of the year. Jenny, that is actually the perfect handoff into your AI beat.

JENNY: Thanks, Andrew. The FIS deal is the second half of an announcement Anthropic made Tuesday at a financial services briefing in New York. The first half — and the bigger story — is that Anthropic is now positioning itself as the operating layer for Wall Street. Claude is already in production at JPMorgan Chase, Goldman Sachs, Citi, AIG, and Visa, according to the company. And this week Anthropic released ten pre-built agent templates aimed at the largest banks.

ANDREW: Ten templates — what kinds of jobs are they automating?

JENNY: The headline one is a Know-Your-Customer screener. Others handle earnings analysis, investment memos, and the kind of cross-document research that used to occupy a junior analyst for half a day. They also rolled out full Microsoft 365 integration, so Claude can move context across Excel, PowerPoint, Word, and Outlook in a single agent — which sounds small but is a big deal for how analysts actually work.

ANDREW: And there's a new model attached to all of this?

JENNY: Yes — Claude Opus 4.7, their most capable model for financial work. The whole package sits on top of a one and a half billion dollar joint venture Anthropic announced last week with Blackstone, Hellman and Friedman, and Goldman to embed Claude across mid-market companies. Plus the two hundred billion dollar compute deal with Google Cloud we covered last week. Anthropic's annualized revenue is now approaching nineteen billion dollars, according to Bloomberg.

ANDREW: One thing I am watching: that is all enterprise. What about government?

JENNY: Mixed news there. The Commerce Department's Center for AI Standards and Innovation announced this week that Google DeepMind, Microsoft, and xAI will join OpenAI and Anthropic in giving the government early access to their models for pre-release safety testing. So every major U.S. frontier lab is now in the program. But Anthropic is still locked out of the Pentagon's classified-network AI awards from May 1st, and the company has two federal lawsuits pending to overturn that designation.

ANDREW: So the commercial side is on fire and the defense side is still in court.

JENNY: That is the picture.

ANDREW: Jenny, what is happening at home?

JENNY: Weather first. Jacksonville is looking at a high near eighty-five degrees today with mostly sunny skies, light winds, and continued dry conditions. We are still in the worst drought period on record going back to 1872. The countywide burn ban remains in effect, and air quality has been elevated all week from wildfire smoke drifting in from surrounding counties.

ANDREW: Any sign of relief in the forecast?

JENNY: Not for at least the next several days. Forecasters are watching for any organized rainfall, but for now the Railroad Fire mop-up continues, and any new fire start in these conditions would be serious. The Red Flag Warning we covered yesterday has expired, but the underlying conditions have not changed.

JENNY: To local government. The Winn-Dixie incentive package is back on the agenda Tuesday night. As we have covered all week, the City Council Finance Committee deferred the twelve million dollar deal on May 5th after members objected to the company's plan to close the Harveys store at 201 West 48th Street near Brentwood. Since then, Winn-Dixie told Councilmember Ju'Coby Pittman the company will agree to keep that store open as a condition of the incentive package. That is per the Jacksonville Daily Record. The full Council takes it up Tuesday, May 12th.

ANDREW: Does the open-store stipulation actually make it into the ordinance language, or is it a handshake?

JENNY: That is the question Tuesday night. A verbal commitment from a corporate rep does not bind the company once the incentives are paid out. If council members want enforceability, the language has to be written into the ordinance. The deal itself is five and a half million dollars in a Recapture Enhanced Value Grant and six and a half million in a Headquarters Retention Grant, in exchange for Winn-Dixie keeping the Edgewood Court headquarters, two hundred jobs averaging about a hundred thousand dollars, and sixty-five million dollars in capital spending.

JENNY: One quick Jaguars note before we go. The team confirmed this week that EverBank Stadium will run at forty-two thousand five hundred seven seats for the 2026 season, with most of the upper bowl offline for stadium-of-the-future construction. Eight home games in Jacksonville, two in London, and the previously announced Pittsburgh game will play in Orlando at Camping World rather than London. Jacksonville blocked Pittsburgh from being scheduled as the London opponent.

ANDREW: Smart move. They keep that Pittsburgh gate inside Florida.

JENNY: Andrew, take us out.

ANDREW: Before we let you go, one thing to watch this week — Monday afternoon, 5:30 Eastern. That is when the Senate holds the cloture vote on Kevin Warsh's nomination as Federal Reserve chair. Republicans hold fifty-three seats, Senator John Fetterman has signaled he will cross over and vote yes, and the Banking Committee advanced Warsh thirteen to eleven on April 29th — the first fully partisan committee vote on a Fed chair in history. Confirmation has to be done before Jay Powell's term ends May 15th. Watch for any Republican senator signaling unease over the weekend, and watch the bond market's reaction Tuesday morning. A clean confirmation likely steepens the yield curve on bets that Warsh's first FOMC meeting leans hawkish on inflation.

JENNY: That's your Morning Brief for Friday. Have a great weekend.

ANDREW: We'll see you Monday.

Good morning. It's Thursday, May 7th, 2026. This is The Morning Brief. I'm Jenny.

ANDREW: And I'm Andrew.

JENNY: Today is the day Iran is expected to give its answer on a one-page memo to end the war — and Wall Street has already priced in optimism, with the S and P 500 and the Nasdaq closing at fresh record highs.

ANDREW: And we'll get into Anthropic's full-court press into financial services — pre-built AI agents for the largest banks, even as the Pentagon keeps the company at arm's length.

JENNY: Let's get into it.

ANDREW: A quick look at the markets. The S and P 500 closed at 7,365, up 1.5 percent — another all-time high. The Dow added 612 points, up 1.2 percent, to close at 49,911. The Nasdaq jumped 2 percent to 25,839, also a record. The ten-year Treasury yield fell about 7 basis points to 4.34 percent as oil prices eased, and the thirty-year fixed mortgage rate is tracking near 6.5 percent according to Mortgage News Daily, slightly lower on the day. The driver across all of these moves is the same — investors betting the Iran war is closer to ending than it is to escalating.

ANDREW: Which brings us to the lead story. Jenny, the framework we've been tracking all week may get its answer in the next several hours.

JENNY: That's the one-page, fourteen-point memo, right? Walk me through where it stands this morning.

ANDREW: Right. According to Axios and CNN, Steve Witkoff and Jared Kushner have been negotiating directly and through Pakistani mediators with Iranian officials on a memorandum of understanding that would do three things — declare an end to the war, kick off a thirty-day window for a detailed deal, and freeze the status quo while that talks. Iran is expected to convey its response today. As of last night, Tehran's foreign ministry said the proposal was still under review, in part because every message has to travel to Supreme Leader Mojtaba Khamenei, who remains in hiding.

JENNY: So if Iran says yes, what actually changes between today and the next thirty days?

ANDREW: In the immediate term, the Strait of Hormuz reopens to commercial traffic, the U.S. Navy stops escorting tankers through, and Iran commits to a moratorium on nuclear enrichment while talks continue. In exchange, the U.S. would begin lifting sanctions and releasing frozen Iranian funds. The hard part — the part that's killed every previous deal — is what permanent limits on Iran's nuclear program look like. The MOU defers that to the thirty-day window, which is either a clever way to lock in a ceasefire or a way to paper over a disagreement that will explode in June.

JENNY: And President Trump has been saying both things this week.

ANDREW: He has. He's threatened intense bombing if a deal isn't reached, and at the same time told reporters he's optimistic. That's the public posture. The private posture, according to the Washington Post, is that the White House thinks Iran's leadership is genuinely divided and may not be able to forge consensus across factions even if Khamenei wants to.

JENNY: Andrew, separate from Iran — the Senate vote on Kevin Warsh is now four days out. Anything new on cloture?

ANDREW: Not much movement. The cloture vote is still scheduled for Monday at 5:30 in the afternoon. Republicans hold 53 seats. Senator Fetterman has signaled he'll vote yes, which gives the White House a small cushion. The full confirmation has to happen before Powell's term expires May 15th, so the timeline is tight but workable. We'll cover Warsh's first FOMC implications closer to the vote.

JENNY: One more national note before we move on — weekly jobless claims drop at 8:30 Eastern this morning. Last week's print was 189,000, the lowest reading since 1969. So the labor market is still telling us something very different from what the inflation data is telling us.

ANDREW: Which is exactly why the Fed's job gets harder by the week. A strong labor market argues against cutting, and an oil-driven inflation spike argues against cutting, but if Iran de-escalates this week, both of those pressures ease at once. That's the sequencing the bond market is trying to price right now.

JENNY: Speaking of rates, let's go to mortgages.

ANDREW: The thirty-year fixed is tracking near 6.5 percent this morning according to Mortgage News Daily, with bond markets calmer after the Iran pullback in oil prices. That's down from a recent peak just under 6.6 percent and consistent with where rates sat before the Hormuz escalation. The Mortgage Bankers Association reported yesterday that overall application volume fell 4.4 percent for the week ending May 1, with purchase applications down 4 percent and refinances down 5.

JENNY: So buyers pulled back when rates spiked. Is the average loan size still climbing?

ANDREW: It is, and that's the data point worth noting. The MBA said the average purchase loan size hit $467,300 last week — the highest in the survey's history, which goes back to 1990. So the people who are still applying are buying more expensive homes. First-time and lower-income buyers are getting priced out, and the market is increasingly skewed toward move-up and equity-rich purchasers.

JENNY: That's a slow-motion problem for housing affordability — and for builders banking on entry-level demand.

ANDREW: It is. One more data point on the calendar — Freddie Mac's weekly survey hits at noon Eastern today. Last week the PMMS came in at 6.30 percent, up from 6.23 the week before. If today's print holds in the low sixes, that's broadly stable. If it pops above 6.4, that's the spillover from the Hormuz spike showing up in the weekly data.

JENNY: Got it. Andrew, let's move over to AI — and the company everyone's been talking about this week is Anthropic.

JENNY: On Tuesday in New York, Anthropic put on a financial services briefing and rolled out something specific — a suite of pre-built Claude agents aimed at the world's largest banks. Per Fortune, they also announced a $1.5 billion joint venture with Blackstone, Hellman and Friedman, and Goldman Sachs to embed those agents inside mid-sized financial firms. And the same day, they launched Claude Opus 4.7, with what Anthropic calls particular gains on the most difficult software engineering tasks.

ANDREW: That's a lot of distribution muscle for a company that, three weeks ago, was getting frozen out of Pentagon contracts.

JENNY: Right, and that contrast is the story. On May 1st, the Defense Department announced classified-network AI deals with eight vendors — Amazon, Google, Microsoft, Nvidia, OpenAI, SpaceX, Reflection AI, and one other — and Anthropic was specifically excluded under a supply chain risk designation. Per CNBC and DefenseScoop, Anthropic refused to allow Pentagon use of Claude for, quote, all lawful purposes, citing concerns about mass surveillance and autonomous weapons. They've sued the Trump administration in two separate federal courts to overturn the designation.

ANDREW: So Anthropic is making a bet — defense work isn't worth compromising their use policies, but financial services is the lane where they can grow. Is that the read?

JENNY: That's exactly the read. They're walking away from one of the most lucrative customers in the world and doubling down on banks, where they don't have the same policy disagreements. And the $200 billion compute deal with Google Cloud we covered Tuesday gives them the capacity to actually serve those banks. Anthropic also announced a full Microsoft 365 integration and a Moody's data partnership the same day, which is the kind of plumbing work that turns a model into a product banks can actually deploy.

ANDREW: That's the difference between a research lab and a vendor — and Anthropic is making clear which one they want to be. What about the regulatory backdrop?

JENNY: That tightened this week too. The Commerce Department's new Center for AI Standards and Innovation announced on Tuesday that Google DeepMind, Microsoft, and Elon Musk's xAI will all give the U.S. government early access to evaluate their models before public release. OpenAI and Anthropic were already doing this. So now the entire frontier — every major American lab — has agreed to pre-release government testing.

ANDREW: That's a significant shift from where this conversation was a year ago.

JENNY: It is. Andrew, before we head local — we're keeping an eye on the AI Standards Center over the next few weeks. The first public test reports are expected this summer, and they could either validate the labs' safety claims or surface things the public has never seen.

JENNY: Speaking of local — let's go to Jacksonville.

JENNY: Weather-wise, Jacksonville is looking at a high near 96 degrees today with mostly sunny skies and gusty winds in the 20s and 30s. The National Weather Service has issued a Red Flag Warning for Duval County. Combined with the city's countywide burn ban, that means critical fire weather conditions today — please don't burn anything outside, and be careful with anything that throws a spark.

JENNY: Now to the news. The Winn-Dixie incentive package we've been tracking took a big step forward yesterday. After the Finance Committee deferred the deal Monday over concerns about a planned grocery store closure, the company has now agreed to keep that store open. Action News Jax and the Jacksonville Daily Record are reporting that Winn-Dixie told Council member Ju'Coby Pittman they'll preserve the Harveys Supermarket on West 48th Street as part of the deal — that's the Brentwood-area store that the city worried would create a federal food desert.

ANDREW: So the $12 million package is back on track?

JENNY: It looks that way. The package — $5.5 million in a Recapture Enhanced Value Grant and $6.5 million in a Headquarters Retention Grant — would keep Winn-Dixie's headquarters at Edgewood Court in West Jacksonville, with 200 new jobs at roughly $100,000 average pay and a $65 million capital investment. Finance Committee was clear — keep the Harveys open and they'll vote yes. The full Council is expected to take this up Tuesday at the May 12th meeting.

ANDREW: That's a meaningful win for the West 48th Street neighborhood — losing the only nearby grocery store would have been a much harder problem to solve later.

JENNY: It really would have. One other Jacksonville note — the Jaguars confirmed this week they will not host the Pittsburgh Steelers in London this year. Per reporting from Yardbarker and the team, Jacksonville used its ability to block Pittsburgh from being scheduled as a London opponent, which means the Steelers will play in Florida instead — at Camping World Stadium in Orlando, since EverBank is in reduced capacity for the Stadium of the Future renovation.

ANDREW: That's a small but interesting business decision — the team is choosing to keep the higher-profile home games on the Florida calendar even with reduced seating.

JENNY: Right. Eight home games at EverBank in 2026, two in London, upper deck closed, capacity at 42,500. We'll keep tracking.

ANDREW: Before we let you go, one thing to watch today — Iran's response to the one-page memo, expected through Pakistani mediators sometime in the next several hours. If Tehran relays a yes, even a conditional yes, expect oil to fall further, the ten-year yield to drop another leg, and mortgage rates to ease before Friday's close. If Iran punts or rejects the framework, the script flips fast — and President Trump's bombing threats become the next headline rather than a negotiating posture. Watch your news app between mid-morning and early afternoon Eastern. That's when we expect to know which way this goes.

JENNY: That's your Morning Brief for Thursday. Have a great day.

ANDREW: We'll see you tomorrow.

Good morning. It's Tuesday, May sixth. This is The Morning Brief. I'm Jenny.

ANDREW: And I'm Andrew.

JENNY: The military operation to reopen the Strait of Hormuz launched less than forty-eight hours ago — and it's already on hold. This morning, Axios is reporting that U.S. and Iranian negotiators are closing in on a one-page agreement to formally end the war.

ANDREW: And Anthropic has committed to spend two hundred billion dollars with Google Cloud over the next five years — a deal so large it accounts for more than forty percent of everything Google's cloud division has on order.

JENNY: Let's get into it.

ANDREW: Quick look at markets. The S and P five hundred closed Monday at seventy-two hundred and fifty-nine, up eight-tenths of a percent — an all-time record. The Dow gained three hundred and fifty-six points to close at forty-nine thousand two hundred and ninety-eight, up about three-quarters of a percent. The Nasdaq led the session, closing at twenty-five thousand three hundred and twenty-six, up just over one percent — also a record. It was the strongest session in weeks, driven by optimism around the Iran pause. The ten-year Treasury yield sits at four-point-three-seven percent this morning, down six basis points from Monday. And the thirty-year fixed mortgage rate is tracking at six-point-five-four percent according to Mortgage News Daily, easing slightly as bond markets take a breath.

ANDREW: Let's start with what sent those markets to all-time highs. Twenty-four hours ago, the U.S. military was actively escorting commercial ships through the Strait of Hormuz under heavy protection. Trump launched what he called Project Freedom — an operation to force open the blockade that Iran has maintained since the U.S.-Israel air campaign began on February twenty-eighth. Within hours, Iran responded with cruise missiles and drones aimed at vessels the U.S. was protecting. And then — yesterday afternoon — Trump called a time-out. He posted on Truth Social that great progress had been made toward a complete and final agreement with Iran, and that the operation would be paused for a short period to let negotiations finish.

JENNY: That's a remarkable reversal. The administration spent the weekend describing this as a life-or-death mission for twenty-three thousand stranded sailors — and then pulled back in a single news cycle.

ANDREW: It is remarkable, and this morning Axios filled in some of the picture. Reporting from U.S. officials says negotiators — Steve Witkoff and Jared Kushner on the American side — are closing in on a one-page, fourteen-point memorandum of understanding with Iranian officials. In its current form, the memo would declare an end to the war and start a thirty-day clock for more detailed negotiations on reopening the strait, limits on Iran's nuclear program, and sanctions relief.

JENNY: Where does the nuclear question stand? That's been the core sticking point throughout all of this.

ANDREW: Unresolved, and Trump said so directly. He described Iran as unyielding on nuclear. U.S. officials told Axios the talks could go either way. The important thing to understand: the Hormuz blockade itself remains fully in force. No ships are moving freely, oil is still elevated, and those twenty-three thousand sailors are still stranded. What's changed is the temperature — and the question this week is whether Tehran moves enough on nuclear to sign even a preliminary memo.

ANDREW: Also on the national front — a separate institutional clock is running. The Senate returns next Monday, and at five-thirty that evening, the chamber is scheduled to hold a cloture vote on Kevin Warsh to be the next Federal Reserve chair. The Banking Committee advanced him thirteen to eleven on April twenty-ninth, which was the first purely party-line committee vote on a Fed chair nomination in history. Republicans hold fifty-three seats, and Pennsylvania Democrat John Fetterman has told Semafor he plans to vote yes. If cloture clears, a final confirmation vote follows — all before Jay Powell's term expires May fifteenth.

JENNY: And Warsh's rate philosophy could matter a lot to buyers and borrowers. You'll get to that in a few minutes. But first, the biggest story in AI is also about enormous numbers. As reported by The Information yesterday, Anthropic has committed to spend two hundred billion dollars with Google Cloud over the next five years. That commitment alone accounts for more than forty percent of the total cloud revenue backlog Google disclosed to investors just last week. On the news, Alphabet shares jumped about two percent in after-hours trading — and for a moment Monday evening, Alphabet briefly overtook Nvidia as the most valuable company in the world.

ANDREW: Two hundred billion dollars. Just to be clear — Anthropic is paying Google, not the other way around?

JENNY: That's right. This is a spending commitment — Anthropic agreeing to pay Google for compute capacity. Specifically, it includes access to Broadcom-built tensor processing units that Google expects to come online starting in twenty twenty-seven. The deal deepens a relationship that already includes an Alphabet investment of up to forty billion dollars in Anthropic. What it signals at a strategic level is that training and running frontier AI models requires infrastructure bets of a scale that would have seemed impossible two years ago — and Anthropic is locking Google in as the backbone of its operation.

ANDREW: It also cements the picture we've been tracking this week — Anthropic's one-point-five-billion-dollar enterprise venture with Blackstone and Goldman Sachs is the distribution layer. The two-hundred-billion-dollar cloud deal is the engine underneath it.

JENNY: Exactly the right way to think about it. And on the agentic side, OpenAI open-sourced a project last week called Symphony that's worth flagging for anyone building enterprise software right now. Symphony is an orchestration framework for Codex coding agents. The idea: instead of engineers supervising AI step by step, tasks get queued from a project board like Linear, agents pick them up and run independently, and humans review the pull request at the end. OpenAI says internal teams saw a sixfold jump in merged pull requests in Symphony's first three weeks. They're releasing it as an open spec, not a maintained product — but it's a concrete look at where enterprise software development is heading, fast.

JENNY: Andrew, over to you on home lending.

ANDREW: The Iran pause that sent stocks to records also gave bond markets a small exhale overnight, and borrowers felt it. The ten-year Treasury dropped to four-point-three-seven percent this morning, down from four-point-four-three at Monday's open, and Mortgage News Daily has the thirty-year fixed at six-point-five-four percent today. That's a modest improvement from the six-point-five-six we saw at the peak of the Hormuz escalation. For context: the spring low was six-point-two-three percent the week of April twenty-third, before geopolitical risk pushed rates back up. Freddie Mac's most recent weekly survey came in at six-point-three percent even, published last Thursday.

JENNY: If a ceasefire in the Strait actually sticks and oil prices come down durably, do mortgage rates follow?

ANDREW: Potentially, yes. Lower oil means lower inflation pressure, which gives the Fed more room to cut. But the gap between where we are now and where buyers really engage — the low sixes or below — still requires the Fed to actually move. That's exactly why the Warsh confirmation vote next week matters directly to anyone sitting at a rate lock desk right now. The market's current bet is that Warsh moves faster toward cuts than Powell would have — but his first FOMC meeting as chair, if confirmed, would be June sixteenth and seventeenth. That's when we'll find out how much policy independence the new Fed actually exercises.

ANDREW: Two things to watch for borrowers this week specifically: the MBA releases its weekly mortgage applications report tomorrow, Wednesday. That'll be the first read on how buyer activity held up through the Hormuz rate spike. And Freddie Mac publishes its Primary Mortgage Market Survey Thursday morning. Together those two numbers will tell us whether the spring buying window is still open or has quietly closed.

JENNY: Thank you. Jacksonville — weather first, because today it matters more than usual. The city is looking at a high of about eighty-two degrees, sunny and dry, with gusty westerly winds. And that combination sits on top of a drought that Jacksonville officials are calling the worst on record since eighteen seventy-two. The Keetch-Byram Drought Index — the standard measure of soil dryness and fire fuel — stands at five hundred and ninety-four out of a possible eight hundred. Jacksonville Fire and Rescue has issued a countywide burn ban effective immediately, and the Duval County Emergency Operations Center has moved to Level Two partial activation to coordinate wildfire resources if conditions deteriorate.

ANDREW: Is this connected to the Railroad Fire that's been burning in Clay and Putnam counties?

JENNY: Directly. That fire — sparked by a passing Amtrak train — has burned through nearly five thousand acres in southern Clay and northern Putnam counties and is approaching full containment. But sunny, dry, and windy days like today are exactly the conditions that can reignite mop-up zones. Jacksonville Fire and Rescue sent crews and equipment to help with containment. Officials are warning loudly that this is going to be a long fire season, and they're asking residents to treat any kind of open burning or unattended debris as a serious public safety risk.

JENNY: On the city hall front, updating a story we've been tracking: the Winn-Dixie headquarters incentive deal hit a wall yesterday. The Jacksonville City Council Finance Committee deferred Ordinance twenty twenty-six dash three twenty-six after council members pressed the company on its plans to close a Harveys Supermarket near Brentwood, which would leave residents in that area more than a mile from the nearest full-service grocery store — the federal definition of a food desert. The deal would have given Winn-Dixie twelve million dollars in city subsidies, in exchange for adding two hundred jobs at six-figure salaries and retaining five hundred existing positions. Finance Chair Joe Carlucci put it plainly: "If this store stays open, I will support the bill." Council member Ju'Coby Pittman, who represents the affected neighborhood, asked Winn-Dixie to reconsider the closure. No new hearing date has been set.

ANDREW: So the deal isn't dead — but the company has a decision to make.

JENNY: Exactly. Winn-Dixie's chief of staff told the committee the Harveys store was performing reasonably well — which, if true, makes the closure question harder to justify. We'll watch for whether the company comes back with a revised plan or lets the deal die on the vine.

ANDREW: Before we let you go, one thing to watch: Monday evening, May eleventh, at five-thirty Eastern — the Senate holds a cloture vote on Kevin Warsh as Federal Reserve chair. That procedural vote is the gate. Two Republican defections can sink it. Watch for any senator publicly wavering before Monday. And watch the reaction in bond markets and rate futures the moment the vote is called — the outcome moves the probability of a June rate cut, which ripples directly into mortgage rates and into where the economy heads in the second half of this year. Powell's term expires May fifteenth. This has to happen first.

JENNY: That's your Morning Brief for Tuesday. Have a great day.

ANDREW: We'll see you tomorrow.

Good morning. It's Tuesday, May fifth, 2026. This is The Morning Brief. I'm Jenny.

ANDREW: And I'm Andrew.

JENNY: The U.S.-Iran ceasefire is in serious trouble this morning. American warships sank Iranian attack boats in the Strait of Hormuz, Iran launched its first strike on the United Arab Emirates since early April, and Brent crude closed at its highest level of the entire conflict. We're going to walk through all of it.

ANDREW: And in AI, OpenAI and Anthropic each announced billion-dollar enterprise deployment ventures — on the very same day. We'll get into what that race actually means.

JENNY: Let's get into it.

ANDREW: A quick look at the markets from Friday. The S and P 500 closed near 7,230, gaining about three-tenths of a percent, according to CNBC. The Nasdaq touched a fresh all-time record, closing just above 25,100, up nearly nine-tenths of a percent. The Dow slipped about 153 points — a third of a percent — to settle just under 49,500. The ten-year Treasury yield sits at 4.43 percent this morning. And the thirty-year fixed mortgage rate averaged 6.30 percent in Freddie Mac's latest weekly survey, published last Thursday. Mortgage News Daily's daily tracking had rates moving higher Monday, toward 6.56 percent, as the Hormuz escalation rattled bond markets.

ANDREW: Let's start with the weekend's dominant story — because as of this morning, the ceasefire that was supposed to end the U.S.-Iran conflict appears to be unraveling.

ANDREW: Here is the sequence of events. Sunday evening, President Trump announced what he called Project Freedom — a U.S. military escort initiative to physically guide commercial ships through the Strait of Hormuz, which Iran has effectively blockaded since the war began in February. Iran immediately called that move a ceasefire violation. Then on Monday, the shooting started. The U.S. military said it sank roughly six Iranian attack boats that were targeting vessels under American protection. Iran responded with cruise missiles, drones, and small boats against U.S. Navy ships. And for the first time since the ceasefire took hold in early April, Iran struck a U.S. ally — the United Arab Emirates. CBS News reports the UAE Defense Ministry confirmed it intercepted fifteen missiles and four drones. One drone got through, igniting a fire at the Fujairah oil facility — a major regional fuel storage hub — and wounding three workers there.

JENNY: Wait — Trump had said the conflict was essentially over. Does this unwind that?

ANDREW: That is the exact question reporters pressed him on Monday, and he wouldn't give a direct answer. He said Iran had taken some shots but caused little damage. The Irish Times called the ceasefire all but over. CNN's framing was fragile ceasefire tested. Iran's argument is that Project Freedom itself is a provocation — that escorting ships through what Tehran considers its maritime enforcement zone violates the terms of the April eighth deal. The scale of the operation matters here: Project Freedom involves guided-missile destroyers, more than a hundred land and sea-based aircraft, multi-domain unmanned platforms, and about fifteen thousand service members. Iran's position is that that's not neutrality.

JENNY: And that's all showing up immediately in oil.

ANDREW: Significantly. Brent crude settled Monday at roughly a hundred and fourteen dollars a barrel — the highest closing of the year. It had briefly traded above that intraday. Overnight it pulled back slightly toward 113. For context, shipping through the strait was already devastated before this weekend — about five percent of pre-conflict traffic. S and P Global Market Intelligence counted just four ships crossing on the first day of Project Freedom. The IEA had already called this conflict the largest supply disruption in the history of the global oil market. This weekend's escalation makes that characterization harder to challenge.

ANDREW: Two other national stories moving this week. First, the economy. The Bureau of Economic Analysis released the Q1 2026 GDP advance estimate last Thursday. The economy grew at a two-percent annualized rate — a genuine rebound from the half-percent reading in Q4 of 2025. But it missed the consensus forecast of around 2.3 percent, and the composition matters: investment and exports carried it, residential construction was a drag, and consumer spending held up. That last point is the one to watch. With oil now a fresh headwind on top of tariff uncertainty, whether consumers hold in Q2 is the central economic question heading into summer.

JENNY: And the Fed chair situation is coming to a head this week.

ANDREW: The Senate floor vote on Kevin Warsh for Fed chair is expected the week of May eleventh — days before Jerome Powell's term expires May fifteenth. The Banking Committee advanced Warsh thirteen to eleven on April twenty-ninth — the first fully party-line committee vote on a Fed chair nominee in the institution's history. Republicans hold 53 seats, so only two defections can sink it. One to watch: Pennsylvania Democrat John Fetterman has told Semafor he plans to vote yes, which would provide rare bipartisan cover. If Warsh is confirmed, he inherits the chair at an unusual moment — an eight-to-four-divided FOMC, an active war driving oil prices, and markets already pricing June rate cut odds in either direction. Jenny, speaking of forces shaping this economy — over to you on AI.

JENNY: Thanks, Andrew. Because Monday turned out to be a historic day in AI, separate from everything happening in the Strait.

JENNY: OpenAI and Anthropic each announced major enterprise deployment ventures. On the same day. Within hours of each other. OpenAI finalized what it is calling The Deployment Company — a ten-billion-dollar joint venture backed by TPG, Brookfield Asset Management, Advent, and Bain Capital, according to Bloomberg. The financial structure is unusual: the private equity investors receive a guaranteed return of 17.5 percent per year for five years. That is not normal venture math. That is a structured finance commitment from an operating company — and it signals how badly OpenAI wants PE distribution. The company is targeting four sectors specifically: health care, shipping, manufacturing, and finance.

ANDREW: What does The Deployment Company actually do?

JENNY: Its job is to push OpenAI's products deep inside the portfolio companies that its private equity partners own. Think about the leverage. A single firm like Brookfield or Bain may own dozens of companies. You partner with them and you get inside access to every one of those businesses as a potential customer. OpenAI controls the joint venture and is committing up to 1.5 billion dollars of its own capital.

JENNY: Anthropic moved almost simultaneously. It announced a 1.5-billion-dollar enterprise AI services venture backed by Blackstone, Goldman Sachs, Hellman and Friedman, and Singapore's sovereign wealth fund GIC, alongside Apollo, General Atlantic, and Sequoia. CNBC reports the deal puts Anthropic in direct competition with the world's largest consulting firms for corporate AI transformation work. The model is different from OpenAI's approach: where OpenAI is using PE portfolios as a distribution channel, Anthropic's venture is more engineering-intensive — embedding Claude specialists directly inside mid-sized businesses to redesign workflows around AI agents from the ground up.

ANDREW: So they're competing for the same enterprise customers but through different doors.

JENNY: Exactly. And the broader context is worth noting. Anthropic is simultaneously running its government lane — the Mythos cybersecurity model, the White House executive order discussions, the Pentagon relationship we've been tracking. The Goldman and Blackstone venture is a completely separate institutional track. Anthropic appears to be running multiple large institutional plays in parallel, which tells you something about the confidence coming off that 30-billion-dollar ARR number and the Google investment.

JENNY: Andrew, I know you've been watching what all of this means for the mortgage market. Let's go there.

ANDREW: The rate picture this week is genuinely complicated. Freddie Mac's PMMS for the week ending April thirtieth showed the thirty-year fixed at 6.30 percent — up seven basis points from 6.23 the prior week. That 6.23 reading was the lowest in three spring homebuying seasons, and it drove real buyer activity: the MBA's most recent weekly data showed purchase applications up ten percent year over year and refinance applications up 52 percent year over year. Buyers responded to that dip.

JENNY: And now that window may be closing.

ANDREW: That's the concern. Mortgage News Daily's daily tracking had rates moving toward 6.56 percent Monday as the Hormuz news hit bond markets. Lenders were already recommending locks heading into last week given the geopolitical uncertainty. That advice looks prescient this morning. The Fed held at three-and-a-half to three-and-three-quarters at its April twenty-ninth meeting, and with inflation risk back on the table via oil, there is no near-term rate-cut cushion to count on. The ten-year Treasury at 4.43 percent is the number to watch — mortgage rates tend to follow it closely, and any sustained move higher there will keep the thirty-year above 6.5 percent.

ANDREW: No major CFPB or FHFA regulatory news over the weekend. The action this week is in the data. The MBA's weekly applications report drops Wednesday morning — first real read on how buyers actually responded to last week's rate move and the weekend's geopolitical escalation. Jenny, back to Jacksonville?

JENNY: Let's do it.

JENNY: Weather-wise, Jacksonville is looking at a high near 83 degrees and sunny conditions today. A good start to the week.

JENNY: On the local front, the Winn-Dixie headquarters incentive package remains in committee with no hearing date set. The twelve-million-dollar deal — a five-and-a-half million dollar revenue enhancement grant and a six-and-a-half million dollar headquarters retention grant — requires 200 new jobs at at least a hundred thousand dollars a year and a 65-million-dollar capital investment. The Jacksonville Daily Record has reported quiet concerns among some council members about the company's German ownership through Aldi. This deal is not yet through the finish line.

ANDREW: What is the redistricting situation doing to Jacksonville's maps? I saw the Supreme Court decision is now having local effects.

JENNY: It is, and it's moving fast. The Supreme Court's ruling in Louisiana versus Callais significantly limits how much race can factor into drawing voting districts. News Four Jax reports that Jacksonville City Council member Rory Diamond is now arguing the current Jacksonville council map is unconstitutional and must be redrawn. At the state level, the Florida Legislature passed new congressional district lines in a special session that could shift up to four U.S. House seats toward Republicans. Lawsuits are active from groups including Florida Rising against both the state and the city of Jacksonville. This is a slow burn, but it could directly affect local election maps later this cycle.

JENNY: Two quick updates on ongoing stories. The Railroad Fire in Clay and Putnam Counties reached 80 percent containment at just under 4,800 acres as of late last week, with crews in mop-up operations. Today's dry and sunny conditions are a concern — firefighters are not ready to call it contained — and burn bans remain in effect across Duval and St. Johns Counties. Watch for a full containment announcement in coming days. And on the Jaguars: the 2026 home season opens at EverBank Stadium with reduced capacity of about 42,500 seats — the entire upper deck is closed for Stadium of the Future construction. For fans heading out to games this season, that is the experience. Construction remains on schedule for an August 2028 completion, with 2027 home games moving to Camping World Stadium in Orlando.

ANDREW: Before we let you go, one thing to watch this week: the Senate floor vote on Kevin Warsh for Fed chair, scheduled for the week of May eleventh. Jerome Powell's term as chair expires May fifteenth, and the Senate is running close on time. If Warsh is confirmed, the immediate market question is what signal he sends on rates — whether he accelerates the path to cuts that three FOMC members were already pushing for at the April meeting, or signals a harder inflation line given the oil shock. Watch for two things: Senate floor scheduling announcements in the next day or two, and whether any Republican senator publicly signals opposition. Two defections are all it takes to change the outcome.

JENNY: That's your Morning Brief for Tuesday, May fifth. Have a great day.

ANDREW: We'll see you tomorrow.

Good morning, and welcome back from the weekend. It's Monday, May 4th, 2026. This is The Morning Brief. I'm Jenny.

ANDREW: And I'm Andrew.

JENNY: As we record this, U.S. Navy vessels are in the Strait of Hormuz for the first time in an active escort role — a mission the Trump administration is calling Project Freedom. Iran has already threatened to fire on American forces that approach. We will tell you exactly what is happening and what to watch for today.

ANDREW: And the Supreme Court issued one of its most consequential rulings in decades last Wednesday — a six-to-three decision that effectively guts a key provision of the Voting Rights Act. Redistricting battles are already igniting across the South.

JENNY: Let's get into it.

ANDREW: A quick look at Friday's close. The S and P 500 finished at 7,230, up about three-tenths of a percent, hitting another record. The Dow slipped 153 points to just under 49,500. The big move was in the Nasdaq — it crossed 25,000 for the first time in history, closing at 25,114, up nearly nine-tenths of a percent. Apple beat quarterly earnings and jumped about three percent, pulling the rest of mega-cap tech with it. The ten-year Treasury yield sits at four-point-three-nine percent. And the thirty-year fixed mortgage rate moved to six-point-three percent, according to Freddie Mac's Thursday survey — up from six-point-two-three the week before.

ANDREW: The weekend in brief: first-quarter GDP came in at two percent annualized on Thursday, the Supreme Court struck a major blow to the Voting Rights Act last Wednesday, and Sunday evening Trump announced the Hormuz escort operation that launched this morning. National is where we start.

ANDREW: On Project Freedom — the operation launched early this morning. At its core, it is the first active U.S. military effort to physically escort commercial ships through the Strait of Hormuz since the Iran conflict began in late February. The scale is significant: roughly fifteen thousand service members, more than one hundred aircraft, and guided-missile destroyers. The humanitarian rationale is real. Hundreds of commercial vessels are stranded in the Persian Gulf — oil tankers, cargo ships, cruise ships — with crew members reporting dwindling supplies of food and drinking water. Trump announced the operation Sunday evening and said any interference will be, quote, dealt with forcefully.

JENNY: And Iran's response?

ANDREW: Immediate and hostile. Iran's military called it a ceasefire violation and warned that any American forces approaching the strait would be attacked. As of this recording, no convoy has attempted passage yet and no shots have been fired. The first attempt is expected later today. Every tanker that gets through has a direct line to oil prices — Brent crude is sitting around one hundred ten dollars a barrel right now. Gas nationally is running about four dollars and thirty-nine cents a gallon. The administration's theory is that Iran's blockade leverage evaporates the moment U.S. military presence makes the strait unenforceable. Whether that holds is the most consequential question in global markets today.

JENNY: And if Iran actually fires on a U.S. vessel?

ANDREW: Then every market and every diplomatic relationship in the region moves fast. The Pentagon has put the conflict's total cost at roughly twenty-five billion dollars so far, according to officials briefed on the military budget. We are watching this by the hour.

ANDREW: On the Voting Rights Act — the ruling came last Wednesday, six to three along ideological lines. The case was Louisiana versus Callais. At issue was Louisiana's redrawn congressional map, which had created a second majority-Black district. Justice Alito wrote the majority opinion, finding that using racial data as the predominant motivation for drawing those lines violates the Equal Protection Clause. The ruling weakens Section Two of the Voting Rights Act — the provision that has been used for decades to protect minority voters from being diluted out of political power.

JENNY: Walk me through the contradiction there — doesn't Section Two sometimes actually require majority-minority districts?

ANDREW: That is exactly the legal tension at the center of this. What the Court said, effectively, is that even VRA compliance cannot justify using race as the predominant factor when drawing a district. The ACLU and the Brennan Center are calling it the most consequential VRA ruling since Shelby County in 2013, which gutted the preclearance requirement. The practical fallout was swift — Louisiana suspended its May 16th primary the next day to allow the legislature time to redraw the map. Republicans in Alabama, Georgia, and South Carolina are already examining whether their own redistricting can benefit from the ruling ahead of November's midterms. This decision will shape the composition of Congress for the next cycle at minimum.

ANDREW: Briefly on GDP — the Bureau of Economic Analysis confirmed first-quarter growth at two percent annualized. That came in just below the consensus forecast of two-point-two percent, but it is a substantial improvement from the fourth quarter's revised half-percent. Investment and consumer spending drove the gain. Imports weighed on the headline as businesses frontloaded purchases ahead of anticipated tariff changes. I will connect the GDP number to what it means for the rate outlook in a moment.

JENNY: Andrew, let me take it from here on the tech side, because the biggest AI story of this weekend comes with a real irony at its center.

JENNY: On Friday, the Pentagon finalized classified artificial intelligence contracts with at least seven major companies — OpenAI, Google, Microsoft, Amazon, Oracle, Nvidia, and SpaceX. These deals expand AI access into sensitive Defense Department environments: intelligence analysis, logistics, large-scale classified data processing. The company that did not get a deal was Anthropic. The Pentagon has maintained a formal supply-chain risk designation on Anthropic since March — a label historically reserved for companies tied to foreign adversaries, and the first time any American company has received it.

ANDREW: What is the actual sticking point?

JENNY: The contract language. The Defense Department wanted Anthropic to permit its Claude model to be used for, quote, all lawful purposes. Anthropic refused, arguing that language could authorize domestic mass surveillance and fully autonomous weapons systems. Anthropic sued the administration. Courts have so far declined to block the Pentagon's designation, and the contracts with the other companies went out Friday anyway. Here is where it gets interesting: the same week Anthropic is being frozen out of government work, it is having a remarkable commercial run. Secondary market trading platforms are now pricing Anthropic above one trillion dollars in valuation — putting it ahead of OpenAI for the first time. And TechCrunch reported late last week that a formal funding round at over nine hundred billion dollars could close within two weeks.

ANDREW: So the company the Pentagon blacklisted might be the world's most valuable AI company by end of the month.

JENNY: That is the situation we are in. There is also a White House angle here — Trump met with Anthropic's CEO Dario Amodei in April and called a deal, quote, possible. Chief of staff Susie Wiles was in that meeting. But the Pentagon moved before any executive-level resolution materialized. Whether the White House steps in to restore Anthropic's access to federal contracts is one of the bigger unresolved policy questions in AI right now.

JENNY: One more note from the tech world — a preprint circulating among emergency medicine researchers found that OpenAI's o1 model correctly identified the diagnosis for roughly 67 percent of emergency room patients when given electronic records and a brief nurse intake summary. Triage physicians in the same comparison were accurate in about 50 to 55 percent of cases. The paper is not yet peer reviewed, but multiple major health systems are already running parallel AI-assisted triage pilots. It is a signal that clinical AI has moved well past the proof-of-concept stage.

ANDREW: Good context, Jenny. Let me turn to the mortgage market, because rates had a telling week and the story behind the move connects to everything we have been talking about.

ANDREW: Freddie Mac's Thursday survey put the thirty-year fixed at six-point-three percent — up from six-point-two-three the previous week. That breaks three consecutive weeks of improvement, which had been the best spring rate window in three homebuying seasons. The uptick came from oil-driven pressure on the ten-year Treasury. The mechanism is direct: when Hormuz tensions rise, inflation expectations move, bond prices fall, yields rise, and mortgage rates follow within days. The Hormuz situation is not an abstraction for home buyers right now — it is showing up in their rate sheet.

JENNY: Does a seven-basis-point move actually change buyer behavior at the margin?

ANDREW: It takes some urgency off the table. The Mortgage Bankers Association reported that applications for the week ending April 24th were down about one-and-a-half percent. More revealing is the composition — adjustable-rate mortgages climbed to eight-point-three percent of total applications. That is buyers betting rates will fall later rather than locking a fixed rate now. They are hedging, which tells you the psychology is fragile. If Project Freedom succeeds and oil retreats, you could see the thirty-year pull back toward the low sixes relatively quickly. If Hormuz stays contested, that rate goes in the other direction.

ANDREW: The other factor shaping the rate outlook is the Fed transition. Kevin Warsh's nomination cleared the Senate Banking Committee thirteen to eleven on April 29th — every Republican for, every Democrat against, the most partisan Fed chair committee vote on record. The full Senate floor vote is expected the week of May 11th. Jerome Powell's term expires May 15th. Warsh will walk into the chair role on the other side of a live military operation, a spring housing market under oil pressure, and a GDP print that keeps the economy in a hold-steady zone. His first public statements on rate direction after confirmation will move markets. Lenders are already recommending buyers lock in now rather than wait to see what he signals.

JENNY: So buyers who have been waiting for rates to fall further may be waiting a bit longer than they hoped.

ANDREW: That is the responsible framing. And sellers who were thinking of holding inventory until rates dropped further may want to reconsider the timing.

JENNY: Let me bring you to Jacksonville. Weather-wise, it is a beautiful start to the week on the First Coast — 86 degrees today, low of 70 overnight, clear skies. A welcome reset after rain moved through late last week.

JENNY: The forward-looking story worth flagging is a sign of where downtown Jacksonville is heading. Whole Foods Market is opening a thirty-eight-thousand-square-foot store at 1 Riverside Avenue in the Brooklyn neighborhood on May 21st. Downtown grocery access has been a persistent sticking point in the city's urban core redevelopment push for years — cited in almost every conversation about whether downtown can actually attract residents, not just visitors. A premium national grocer committing to that corridor is a signal that foot traffic on Riverside Avenue has reached a real threshold. The store's design nods to the Florida Times-Union building that once stood on the site, and the product assortment features more than 800 local Florida items.

ANDREW: What is the broader context for that timing?

JENNY: It is almost too well timed. The Jacksonville Jazz Festival runs the same weekend — May 21st through May 24th, Memorial Day weekend — drawing tens of thousands of people into the core. The Jaguars stadium reconstruction is at fifteen percent complete, on track for an August 2028 finish. JTA investments in the corridor continue. When you add a national grocery anchor to that picture, you start to see downtown Jacksonville making a genuine argument for itself as a place to live. The Whole Foods opening is a data point in that argument.

JENNY: On a harder note for local wallets — Duval County gas prices hit four dollars and thirty cents a gallon last week, matching the four-year national high tied directly to the Hormuz disruption. Before the Iran conflict began in late February, the local average was around three dollars and fourteen cents. That is more than a dollar-per-gallon increase in about ten weeks, paid by every commuter, every delivery driver, and every small business running a fleet in Northeast Florida. Every tanker that gets through the strait today is a data point on when that number starts coming down.

JENNY: Two more quick items from the First Coast. Duval County's school bus stop-arm camera program is now issuing real fines — two hundred twenty-five dollars per violation. The warning period ended last week. Blanding Boulevard has been flagged as the highest-violation corridor in the county. If you drive that stretch during school hours, treat every school bus stop as a camera event, because it very likely is one. And updating a story we have been tracking — the Railroad Fire in Clay and Putnam counties was at about 80 percent containment as of late last week, and the rain that moved through Thursday and Friday gave crews the moisture they had been waiting on for weeks. Full containment appears close.

ANDREW: Before we let you go, one thing to watch today — and genuinely just today: the first convoy attempt through the Strait of Hormuz. Project Freedom is live. Fifteen thousand service members are in those waters right now. Iran has threatened to fire. The strait has been operating at a fraction of its normal capacity since the war began in February. If the first convoy gets through without incident, watch for an oil price pullback by end of day — which translates directly into the ten-year Treasury, into mortgage rates, and into what you pay at the pump here in Jacksonville. If there is an incident, you are looking at a fundamentally different week. Check U.S. Central Command's public channels and any major wire service for convoy updates this afternoon. This is as live as a story gets on a Monday morning.

JENNY: That's your Morning Brief for Monday. Have a great start to the week.

ANDREW: We'll see you tomorrow.