Sep 19, 2025

min read

“Doing well with money isn’t necessarily about what you know. It’s about how you behave. And behavior is hard to teach, even to really smart people.” — Morgan Housel

Most of us don’t misread markets so much as we misread ourselves. We often know plenty, but struggle to know how to act on what we know, and when.

The calm move isn’t a trade, it’s remembering why the portfolio exists: your kid’s future, a freer Tuesday, a little less worry at night. When that purpose is clear, the day-to-day noise has less room to push us around.

☕ Let’s dive into today’s fresh edition of Diversification Daily.

🗞️ Today's stories that matter (and why)

1. 💵 Treasury flows: foreign ownership hits record,China at 2008 low

Foreign holdings of US Treasuries reached a record $9.16T in July, led by Japan and the UK, while China fell to ~$731B, the lowest since December 2008. published yesterday evening ET.
Context (zoom-out): A higher term premium (extra compensation investors demand beyond expected short-term rates) can keep long yields elevated even after Fed cuts.

Why it matters: Broad overseas demand supports liquidity and rates, but a higher term premium, plus China’s steady reduction, can keep borrowing costs sticky.

Assets in Focus: Fixed Income

2. 💻 US stocks notch record closes as Intel spikes on Nvidia stake

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Major indexes hit fresh records after the Fed’s cut, turbo-charged by news that Nvidia is investing ~$5B for ~4% of Intel, sending Intel up ~20%+ and lifting semiconductors broadly.

Traders also priced odds of additional easing if jobs cool, published today.

Why it matters: When the AI leader buys into an incumbent chipmaker, it signals capital reallocation inside the AI stack,and can widen mega-cap tech leadership already dominating many portfolios.

Assets in Focus: Equities

3. 🧱 Homebuilder Lennar’s profit drops on affordability squeeze

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Lennar (No. 2 US homebuilder) reported a 46% year-over-year profit decline and revenue miss, citing buyer affordability pressures despite using incentives like rate buydowns.

It guided 22k–23k Q4 deliveries, below Street hopes, as margins remain under pressure.

Why it matters: Big builders are bellwethers for housing activity, construction jobs, and related consumption (appliances, furnishings). Weaker margins,even with incentives,signal that affordability, not just mortgage rates, is still the gating factor.

Assets in Focus:Real Estate

4. ₿ SEC fast-tracks crypto ETFs with new listing rules

The SEC approved generic listing standards for spot commodity ETFs across NYSE Arca, Nasdaq, and Cboe,removing much of the case-by-case red tape that slowed crypto ETFs.

This could open the door to broader, cheaper-to-launch products beyond Bitcoin/Ether as soon as October (if assets meet criteria).

Why it matters: Expect more crypto ETFs,great for access, tricky for due diligence. For long-term investors, weigh fees, liquidity, and fit within a small “alternatives” sleeve rather than chasing tickers.

Assets in Focus: Alternatives

5. 🏛 Congress races to avert Oct. 1 US government shutdown

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The House narrowly passed a stopgap bill to keep the government open into late November, but the Senate rejected it, and also voted down a Democratic alternative.

With both plans failing, Congress has no agreement and only days before funding expires on Oct. 1; senators are not back in session until Sept. 29, shrinking the window.

Why it matters: A shutdown can delay key economic data, pause some services, and add short-term market noise. Historically, the impact on diversified long-term portfolios is modest, but headlines can boost volatility.

Assets in Focus: Equities

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🤯 Alternative investment highlight: ✈️The Shadow market for airline miles: discounted biz seats, real risks

Airlines mint loyalty points and sell them to banks at high margins, roughly 1.5–2.5¢ per mile, turning rewards into a profit engine that generated $25B+ annually for major US carriers in recent years (and where ~57% of miles are earned via credit cards, not flying). That lucrative ecosystem creates room for mileage brokers who acquire large pools of miles and then redeem award tickets for customers, often marketed as “discounted business-class” deals. It’s sizable enough to attract persistent demand, but buying/selling miles violates most airline program terms, even if it’s generally not illegal.

The catch: enforcement is real. Airlines increasingly cancel tickets, shut accounts, and confiscate miles when they detect brokered redemptions; industry coverage calls the broker world a “big underground industry,” with reports of brokers boasting access to hundreds of frequent-flyer accounts (one cited claim: 500+ KrisFlyer accounts). Travelers have even taken airlines to court over account closures tied to mileage misuse.

Bottom line: while the arbitrage can look attractive versus cash fares, the operational and account-closing risk is material, and airlines have strong financial incentives to crack down because they themselves earn billions selling miles to partners.

🧠 From the Education Center: Is private credit hiding more risk than it shows?

High yields and low daily volatility don’t always tell the full story in private credit markets. 🔗Learn more

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