July 24, 2025
4
min read
💬 Daily Observation
“Everything is in a constant state of change, and the wise investor recognizes that success is a process of continually seeking answers to new questions.” — Sir John Templeton
We’re a bit late today, just like the quote suggests, we’ve been seeking answers to new questions in an all‑day deep dive on improving our product and communication.
Diversification Daily truly lives up to its name: every day we cut through the noise to bring you the freshest stories that matter the most for long‑term investors like us.
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☕️ Grab your coffee and let’s dive into today’s fresh edition of Diversification Daily.
🗞️ Today's stories that matter (and why)
1. 📊 US business activity rises, tariffs fuel inflation concerns
S&P Global’s Composite PMI jumped to 54.6 in July from 52.9 in June, led by services, while manufacturing slid into contraction at 49.5 as new tariffs pushed up costs.
Input‑ and selling‑price indices both accelerated, signaling continued inflation above the Fed’s 2% target.
Why it matters: Services strength suggests consumer resilience, but rising costs could force the Fed to hold rates longer.
Assets in Focus: Fixed Income
2. 🛢️ Oil prices climb on US. trade optimism
Brent crude rose 0.38% to $68.77 and WTI added 0.67% to $65.69 amid progress in US–Japan auto talks and a surprising 3.2 million‑barrel draw in US inventories.
OPEC+ production plans and Russia–Ukraine tensions capped gains.
Why it matters: Higher energy costs feed through to consumer inflation and squeeze corporate margins, with implications for sector allocations and inflation‑protected assets.
Assets in Focus: Commodities
3. 🪙 Gold eases as risk appetite improves
Spot gold fell 0.5% to $3,370.69/oz as signs of softer trade frictions dented safe‑haven demand, even as a weaker dollar offered some buffer. This marks the second straight daily decline.
Why it matters: A modest pullback may offer tactical buying opportunities for diversification, especially if safe‑haven demand revives amid fresh geopolitical or policy shocks.
Assets in Focus: Commodities
4. 🤖 AI investment propels US. GDP against recession fears
A surge in AI‑related capex, data centers, chips, power systems, added roughly one‑third of Q2’s 2.5% annualized GDP growth, defying slowdown expectations.OpenAI’s ChatGPT launch kick‑started this “re‑industrialization” of American capex.
Why it matters: AI is reshaping the growth outlook, supporting earnings and justifying higher equity multiples.
Assets in Focus:Equities
5. 💻 Tech earnings spotlight: Alphabet, IBM & Tesla Q2 results
Alphabet delivered Q2 revenue of $96.4 billion, 14% year over year, topping expectations as its cloud unit surged 32% on the back of in‑house chip development and Gemini AI adoption; advertising revenue also climbed 10.4%, prompting at least 17 brokerages to raise price targets on the stock.
IBM posted Q2 sales of $16.98 billion, an 8% year‑over‑year gain, and adjusted EPS of $2.80, driven by renewed demand for AI‑optimized mainframes and a consulting rebound that reversed five quarters of decline.However, IBM’s software segment missed forecasts at $7.39 billion versus $7.41 billion expected, weighing on after‑hours trading.
Tesla saw Q2 revenue fall 12% to $22.5 billion with core automotive sales down 16%, while operating profit plunged 42% to $923 million, its auto gross margin ex‑credits held at just 15%. CEO Elon Musk warned of “rough quarters” ahead amid waning EV incentives and intensifying competition.
Why it matters: Bundling these results highlights the contrasting fortunes in tech: cloud‑AI strength at Alphabet, AI‑mainframe resilience at IBM, and cyclical pressures at Tesla, key for gauging sector momentum.
Assets in Focus: Equities
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🤯 Alternative investment highlight: 👟 Rare soles, real profits, inside the sneaker secondary market
The global sneaker‑resale market hit $11.5 billion in 2023 and is projected to grow to $51.2 billion by 2032, a 16.4% CAGR, as collectors and eco‑minded shoppers chase limited‑edition drops and sustainable buys. In the US alone, the second‑hand segment was $2 billion in 2023, with millennials aged 27–42 and Gen Z making up over 80% of buyers, often purchasing three or more pairs per year.
Powered by marketplaces like StockX, where Asics trades leapt 589% YoY, and GOAT’s robust network, closets are turning into de‑facto alternative‑asset portfolios.
Yet this isn’t a free‑for‑all: buyers face 10–15% transaction fees and a counterfeit peril that ensnares 68% of social‑media shoppers, making due diligence non‑negotiable.
Rare pairs can still fetch life‑changing sums, Nike’s Waffle “Moon Shoe” prototype sold for $437,500 at auction, while self‑lacing MAGs routinely go for $35,000+.
Brands and policy are stepping in: Nike Refurbished now processes 680,000+ pairs annually to extend product life cycles, and a new bipartisan U.S. caucus is pushing tax breaks and circular‑economy incentives to normalize second‑hand commerce.
Niche collectibles like sneakers can rival traditional alternatives—but only if investors master authentication, fees, and patience.
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🧠 From the Education Center: Is scarcity mindset killing your investment returns?
Playing it safe can quietly cost more than any market crash. Holding too much cash out of fear may feel responsible, but it often means missing the upside.
Over time, missed growth can erode wealth more than short-term losses ever would.
Explore how scarcity thinking sabotages long-term returns: 🔗Learn more
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