Good Morning! Today’s edition is 978 words, a 4-minute read.

What’s on tap: 

• The end of Kodak

• ChatGPT poisoning

• Terrifying rabbit

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Big Stories

Inflation Steady Despite Tariffs

• US inflation held steady at 2.7% in July despite President Trump's tariffs pushing up import costs, as falling gas and grocery prices provided relief for consumers. But core inflation rose to 3.1%, well above the Federal Reserve's target, creating a dilemma for policymakers weighing interest rate cuts as job growth slows.

• Trump's tariffs are working their way through the economy as companies run out of room to absorb the costs. Major retailers, including Walmart and Procter & Gamble, announced price hikes in August. Economists expect consumers will absorb about two-thirds of tariff costs by fall, up from roughly one-quarter now. The trend could reverse July's grocery price declines as more businesses pass along import duties.

• Trump escalated pressure on economic institutions as inflation persists above Fed targets. Trump fired the Bureau of Labor Statistics head after disappointing jobs data and also attacked Fed Chair Jerome Powell for not cutting interest rates.

Kodak’s Moment is Running Out

• Eastman Kodak warned it could go out of business after more than 130 years, citing “substantial doubt” about its future as it struggles with more than $470 million in debt. The news sent company shares tumbling on Tuesday. Kodak employed over 140,000 workers worldwide in the 1980s but now has just 1,400 employees.

• Kodak introduced the first consumer-friendly camera in 1888 with George Eastman's promise, 'You press the button, we do the rest,' making photography accessible without technical knowledge. The company’s $1 Brownie camera sold over 1.2 million units between 1900 and 1905, and it controlled 70% of the US film market by the 1950s.

• Despite inventing the world's first digital camera in 1975, Kodak didn't pivot from its profitable film business as digital photography took over. It filed for bankruptcy in 2012 and emerged focused on commercial printing and specialty chemicals, but neither generated enough revenue to sustain operations. Kodak is cutting its pension plan and expects to announce by Friday whether it can restructure its debt or be forced to shut down.

YouTube Age Verification Test

• YouTube will begin testing an AI system today that guesses users' ages by analyzing their viewing history instead of trusting the birth dates they entered when signing up. The test affects a small group of logged-in US users but could expand nationwide if successful, making YouTube the first major platform to use viewing patterns for age verification.

• Users the AI flags as under 18 will automatically get teen restrictions, including limited video recommendations and no targeted ads, while those wrongly classified as minors must prove their age with ID, credit card, or selfie to restore full access. Digital rights groups warn this approach could restrict access to legal content and violate free speech protections.

• The test responds to growing political pressure to protect children online following a June Supreme Court ruling upholding Texas’s law restricting minors’ online access to pornography. Major tech companies, including Google and Apple, have resisted calls to implement age verification at the app store level. YouTube’s approach could set a precedent for how platforms verify ages.

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Quick Stories

US News

• The White House ordered a review of Smithsonian museums to ensure exhibits align with Trump's view of history and remove "divisive narratives" before America's 250th anniversary. (More)

• Texas Attorney General Ken Paxton called for jailing Beto O'Rourke over his role in helping Democrats flee the state to block redistricting maps. (More)

• Mexico handed over 26 cartel leaders to the US, including bosses from Jalisco and Sinaloa groups, in the latest major transfer under Trump pressure. (More)

World

• Canada's wildfire season is already the second-worst on record, with 470 fires out of control and area burned 78% above the five-year average. (More)

• About 100 people, including children, tried to swim from Morocco to Spain’s Ceuta, but Moroccan and Spanish forces stopped most. Recent attempts have surged, straining Ceuta’s overwhelmed reception system. (More)

• Teen pilot Ethan Guo has been stuck in Antarctica since June after landing illegally, but avoided trial by agreeing to pay $30,000 to charity. (More)

Business & Economy

• US stock markets closed higher on Tuesday (S&P +1.13%, Nasdaq +1.39%, Dow +1.10%). Better-than-expected inflation data pushed the S&P and Nasdaq to record highs. (More)

• AI startup Perplexity offered to buy Google's Chrome browser for $34.5 billion in what's seen as a marketing masterstroke to raise the profile of its own browser. (More)

• Spirit Airlines warned it could go out of business within 12 months due to cash shortages, sending its stock down 40% while rival airlines surged. (More)

Sports & Entertainment

• Defending champion Oklahoma City Thunder face Houston's Kevin Durant on NBC on October 21, followed by Lakers-Warriors in NBC's first NBA games since 2002. (More)

• The Little League World Series begins today in Williamsport, Pennsylvania, with 20 teams competing for the championship through August 24 in the annual youth tournament. (More)

• Taylor Swift revealed her twelfth album, "The Life of A Showgirl," during boyfriend Travis Kelce's podcast, with pre-orders shipping before October 13. (More)

Science, Health, & Tech

• Researchers identified spinal cord neurons that regulate breathing by responding to high carbon dioxide. Targeting these neurons could lead to new treatments to improve breathing in spinal injury and respiratory disease patients. (More)

• A man developed paranoid delusions after following ChatGPT's advice to use sodium bromide as a salt substitute, landing him in the hospital with rare poisoning. (More)

• Scientists found a mouse-sized mammal fossil in Chile from 74 million years ago that likely laid eggs like a platypus while living alongside dinosaurs. (More)

Extra Credit

World’s first artificial tongue can taste like a human’s.

The most turbulent flight route in every country.

Rabbit with tentacles growing from its head spotted in Colorado.

McDonald’s launched its adult Happy Meal.