Good morning. The Federal Trade Commission is seeking information about how artificial intelligence and other technological tools may allow companies to vary prices using data they collect about individual consumers’ finances and shopping habits.

• 'Personalized pricing' investigated: The FTC said its study aims to reveal the inner workings of personalized pricing, a way of varying prices down to the individual level that has long been the holy grail of marketing. The commission says the algorithms and models that drive pricing strategies are opaque and may rely on surveilling consumers’ online footprints.
   
• FTC's goal: “Americans deserve to know whether businesses are using detailed consumer data to deploy surveillance pricing, and the FTC’s inquiry will shed light on this shadowy ecosystem of pricing middlemen,” Chair Lina Khan said in a statement announcing the review.
   
• Who they're going after: The FTC is issuing civil subpoenas to financial companies and consultants that help companies decide pricing strategies: Mastercard, JPMorgan Chase, McKinsey, Accenture, Revionics, Bloomreach, TASK and PROS. Their clients tend to be in the retail, restaurant, grocery, travel, finance and hospitality industries, officials said.
   
• What's price discrimination? Companies try to maximize profits by offering prices that are acceptable to different groups of consumers, defined by attributes such as age, socio-economic status and their affinity for certain goods and services. Online advertising and data analytics have made it easier to target smaller groups of consumers. The FTC’s reference to “surveillance pricing” suggests it believes that consumers don’t understand how their personal information may be used to tailor prices to them.

U.S. foreign investment watchdog reports major uptick in penalties.

The U.S. government panel that reviews transactions for national security issues imposed more penalties last year than in its entire 50-year history, an uptick in activity that comes amid concern about China.

The Committee on Foreign Investment in the U.S. assessed four civil penalties in 2023, the panel said in a report to Congress issued Tuesday.

Cfius, which reviews foreign purchases of real estate and investments in U.S. companies, before last year had issued only two such penalties since its inception in 1975. The report didn’t name the entities that paid the penalties. The committee, which is run by the U.S. Treasury Department, previously imposed penalties in 2018 and 2019.

OFAC probes Russian sovereign assets held by financial institutions.

The U.S. Treasury Department, as part of implementing the recently passed REPO Act, is requiring all financial institutions holding Russian sovereign assets to report them to the Office of Foreign Assets Control no later than Aug. 2, or within 10 days of detecting such assets.

The REPO Act, part of a $95 billion foreign-aid and national-security bill passed by Congress in April, looks to use some of the $300 billion in frozen Russian assets to pay for the damage caused by the invasion of Ukraine.

• Federal transportation officials have launched an investigation into Delta Air Lines as the carrier struggled to rebound from an operations meltdown that led to thousands of canceled flights and stranded passengers.
   
• U.S. air-safety regulators are launching a broad review of Southwest Airlines after a string of recent close calls and other incidents.
   
• Electric-scooter renter Bird Global, which is trying to settle more than 200 personal-injury claims in bankruptcy, is encountering emboldened opposition to its proposed reorganization plan after the Supreme Court’s recent ruling against Purdue Pharma, according to WSJ Pro Bankruptcy (subscription required).
   
• Johnson & Johnson is closing in on one of the largest settlements of mass-tort lawsuits in history. Its strategy is to divide and conquer the trial lawyers.
   
• Spanish antitrust officials launched an investigation into Apple, saying the iPhone maker might be imposing unfair conditions on developers who rely on its App Store to distribute their applications.

CrowdStrike’s botched tech update wasn’t unique. Are lessons ever learned?

Friday’s global tech outage shows how fragile and interconnected infrastructure can be, proving once again companies are vulnerable to their trusted vendors.

The incident should prompt companies to think about the code they allow into their systems when they don’t know exactly how it has been tested, said Chris Krebs, chief intelligence and public policy officer at security company SentinelOne, a CrowdStrike rival.

“Speed over stability is just asking for trouble, and this, frankly, was predictable if not inevitable,” said Krebs, former director of the U.S. Cybersecurity and Infrastructure Security Agency, which is tasked with hardening federal and critical-infrastructure defenses against hackers.

• Delta Struggles to Regain Footing After Tech Outage
• Preparing for the Next Worldwide Tech Outage

China’s malaise spreads to luxury industry.

China, the engine of the luxury-goods industry, is stalling out as the country’s middle-class consumers rein in spending that has long powered the growth of some of the world’s most upscale labels.

What's going on? Luxury executives are divided over whether the downturn represents a passing storm or a more lasting shift in the behavior of Chinese consumers, particularly middle-class shoppers. High youth unemployment, declining real-estate prices and trade tensions have eroded consumer confidence in the country, prompting the middle class—which accounts for a significant chunk of luxury purchases—to save rather than spend.

• As the administration’s most ardent senior-level advocate of securing a cease-fire in Gaza, Vice President Kamala Harris’s elevation to the Democratic Party’s standard-bearer now puts her in a stronger position to advocate for a shift in U.S. policy toward Israel and to carry out those changes should she win in November.
   
• U.S. retailers are pulling forward overseas orders to get ahead of deepening shipping disruptions, rising freight rates and looming geopolitical concerns.
   
• Amazon.com’s Echo speakers are the type of business success companies don’t want: a widely purchased product that is also a giant money loser.
   
• The Washington, D.C., office market is struggling with rising foreclosures, plunging values and its highest vacancy rate ever. 
   
• Home prices hit a new high in June for the second straight month, the latest sign that the housing market is unaffordable to millions of Americans.
   
• Americans’ once-in-a-generation job market has come to an end. The red-hot hiring and rock-bottom unemployment that helped millions of workers find new gigs, boost their wages and reinvent their careers are giving way to more prosaic times.
   
• Political deadlock in France and a prolonged slump in German manufacturing continue to dog economic activity in the eurozone, according to surveys published Wednesday.

• Secret Service Director Kimberly Cheatle resigned Tuesday amid bipartisan outrage over her agency’s failure to stop a 20-year-old gunman from opening fire on former President Donald Trump during a campaign rally.
   
• Sen. Bob Menendez said Tuesday that he would resign from Congress following his conviction last week on corruption charges.
   
• Tesla’s profit tumbled 45% in the second quarter as the electric-vehicle leader continues to feel the impact of slower demand and stiffer competition.
   
• In an energetic campaign-trail debut Tuesday as the expected Democratic nominee, Vice President Kamala Harris mocked former President Donald Trump and depicted the Republican as an agent of chaos from the past.
   
• Atlantic salmon, though unremarkable in size, is a big fish in the culinary world. But producers face a pesky problem to keep salmon king.

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