• Luxury brands are retreating to exclusivity after years of trying to broaden their appeal, but they’re now struggling to reconcile that elusiveness with younger consumers’ desire to share and express identity online. With the luxury market shrinking—marked by a 3% dip in early 2025 and the loss of around 50 million customers—brands must urgently innovate to maintain relevance, exclusivity, and emotional connection in the social media era.

Luxury brands have retreated back to their safe space of exclusivity, having explored new avenues to win customers during COVID. The only problem is, to win and retain the next generation of shoppers they must marry their need to remain elusive with a consumer who wants to share everything online.

These companies have no time to waste. According to a spring update on the sector from Bain & Co, the industry is losing speed relatively quickly.

The study released Thursday shows the sector’s worth was €1.5 trillion ($1.7 trillion) in 2024, though for Q1 of 2025 estimates are shrinkage of 3% compared to last year.

Even last year, personal luxury goods was one of the categories which marked the most notable slowdown, knocking from €369 billion in 2023 down to €364 billion in 2024. That marked its first contraction in 15 years—with the notable exception of the pandemic.

And the gap between winners and losers in the luxury sector is also growing, added the author’s writers Claudia D’Arpizio and Federica Levato.

The gap between the top 75th percentile and the bottom 25th percentile performers increased by 1.5 times in Q1 2025 compared to a year earlier, with market leaders continuing to charge ahead while the bottom 20% to 30% of the sector continued to report a reduction in growth.

Part of the problem is consumers are wrangling with what Bain & Co describes as the “value equation”—basically, are they getting enough—be it experience, social and cultural kudos, or workmanship—out of the purchase for the elevated price they are paying?

For a “long period” luxury brands were trying to enlarge their customer base to be more inclusive, D’Arpizio tells Fortune. This was really reinforced in some categories with “entry items like streetwear, sneakers, and even beauty—all the categories that could have been more relevant for young people, but also with people with less discretionary spending.”

That strategy “overcorrected” she added, with brands overly relying on iconic design or experiences, reducing their pace of innovation and hence, leading consumers to question if their spend is really worth it.

“So last year we had a big loss of customers—around 50 million less customers buying luxury product—in particular in the younger generation, and a big drop on customer advocacy,” D’Arpizio continued. “What is happening now that the brands are trying to fix that, and trying to reignite this relationship with these customers without losing their exclusivity.”

Exclusivity in the online age

Shifting back to exclusivity is a more difficult ask when younger consumers are known as the social media generation for their propensity to post online.

Gone are the days of galas with no cameras, of designer handbag back rooms with no filming allowed: It’s all available on a For You Page within moments of ending.

“Luxury has always been about showing off,” D’Arpizio, who is Bain & Co’s lead for the global fashion, luxury goods vertical, continued. “The previous generation was showing off wealth and showing off accomplishments in life, now it’s more showing off of your of your personality or your ability to choose your aesthetics, your quality of life. 

“There is a big need, in particular in Gen Z, for sharing. This sharing means expressing their personality … but also a desire of conformity. These are two forces that are contradictory but in reality are a big driver for luxury consumption because luxury brands can provide this conformity, but then inside the luxury brand, mixing and matching, choosing your own style, developing your own style, creates your self-expression.”

She continued: “Social media has provided a huge impulse to luxury consumption because the potential of sharing with a larger audience has created both more customers but also in augmentation of their communication strategies and so they have a broader reach. 

“So yes, they want to be exclusive, but they know the power of social media.”

This story was originally featured on Fortune.com

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• Lukas Walton, an heir to the Walmart fortune, has quietly invested $15 billion of his wealth into Builders Vision, a Chicago-based organization focused on environmental and societal impact through sustainable investments in clean energy, food, and agriculture. Preferring to stay out of the spotlight, Walton believes in engaging the business community for scalable change and insists that impactful projects can deliver financial returns comparable to traditional investments.

In the current economy, the work, opinions and battles of billionaires can be hard to avoid—yet the dynasty behind the leading business in the Fortune 500 tends to stay out of the spotlight.

Every now and again members of the Walton family, whose relatives began the Walmart empire, will quietly share their thoughts on the political or economic outlook before returning to their work.

And that’s precisely how Lukas Walton has wanted it to be. The man worth $39 billion courtesy of the business founded by his grandfather, Sam Walton, established Builders Vision in 2017 as an umbrella for his philanthropic, investment, and advocacy work.

The focus of the Chicago-based company is to deploy capital, advocate for change, and support partners more widely in a range of endeavors across clean energy, food and agriculture, and ocean preservation.

Walton had declined all media interviews, but spoke to the Financial Times for the first time in an interview published today, saying he had made the decision to prevent people “leading with their assumptions” about him.

Instead Walton has directed his time and funds towards environmental efforts and told the FT he had plowed $15 billion of his own funds into Builders Vision—to bankroll endeavors that come with both financial and societal returns.

Walton, 39, is adding his voice to a wider push from other billionaire philanthropists for a greater focus on a more sustainable and equal planet.

Earlier this year, for example, Microsoft co-founder Bill Gates confirmed the largest philanthropic donation from an individual in modern history. He announced the Gates Foundation will receive the vast majority of his wealth—approximately $200 billion—to be spent within the next two decades.

While Walton’s motives are clear—he wants the world to be more “humane and healthy”—he has experienced first-hand the benefits that access to good nutrition can bring.

As a preschooler Walton was diagnosed with a rare form of cancer and, according to the Walton family, was cured in part thanks to his mother feeding him an all-natural diet.

Walton said he is “constantly reminded” of how lucky he is to be alive, and added: “My parents taught me the good habits that have kept me around. My mom basically raised me out of her garden, and that way I got to learn where our food comes from.”

The Colorado College graduate continued: “Starting with food and agriculture, I want to put my money to work and I saw there was a space for innovative, flexible capital.

“My gut feeling all along has been to engage the business community because of its size and scale.”

Not charity

Fundamental to Walton’s belief is that investors—and indeed his high net worth peers—need to see returns if they are going to fully engage their capital in projects which have societal or environmental benefits.

As such, he told the FT, his projects should not be framed as charitable because they have a very clear focus on returns that either match or outperform the rest of the market.

Walton has already undertaken significant projects which he says demonstrate returns, for example backing a business in Nebraska that purchases and then leases farmland for organic agriculture.

Making the green economy a more palatable investment than markets is certainly no small undertaking, but Walton, the CEO of Builders Vision, maintains: “The opportunities are out there.

“[The finance gap] is not for lack of pipeline. But people first need to realize that the environment is industry, it’s infrastructure, it’s financial products, it’s not simply trees.”

It seems Walton—ranked 37th on Bloomberg’s Billionaires Index—is happy to get on with the job in his own way. He’s often spotted cycling to the office in Chicago, and drives a Volvo SUV instead of the higher-end luxury vehicles preferred by other billionaires.

His urge to stay out of the limelight extends to his hobbies. The quiet of trail biking, he says, is a draw because “it’s one of those places I can’t be on a phone call.”

This story was originally featured on Fortune.com

• ANALYSIS: The Federal Reserve is widely expected to keep interest rates steady at 4.25% to 4.5% amid heightened uncertainty from Middle East tensions, volatile oil prices, tariff disputes, and a recent U.S. debt downgrade by Moody’s, all of which complicate the economic outlook and policy decisions. Despite political pressure from President Trump to cut rates, analysts anticipate the Fed will maintain its cautious, data-driven approach, holding off on cuts until there is clearer evidence of economic weakness or easing inflation.

If members of the Federal Open Market Committee (FOMC) were hoping to meet with some greater clarity this month, they will be sorely disappointed.

Instead of a clearer path laid out ahead, Jerome Powell and his peers sat down to news of increased geopolitical conflict in the Middle East—potentially pushing up oil prices—as well as ongoing uncertainty over tariff agreements with key partners, and a downgrade of U.S. credit by Moody’s.

Of course, the elephant in the room will be President Donald Trump’s reaction if the FOMC once again refuses to heed his wishes in cutting the base rate.

The melting pot of issues leads most analysts to suspect the base rate will once again be held steady at 4.25 to 4.5%—a relatively tight stance according to dovish economists who argue the economy is coping relatively well according to data.

As David Doyle, head of economics at Macquarie Group, wrote in a note shared with Fortune this week, the Fed is walking a “tightrope.”

“The FOMC is likely to hold rates steady again this week,” Doyle continued. “The market reaction is likely to be driven by the communication and the potential guidance of further cuts. The dot plot may push out the suggested timing of rate cuts. We suspect this may tilt somewhat and suggest 25 bps [basis points] of cuts in 2025 and 75 bps in 2026 (from 50 bps in each year in March).”

Doyle added that Chair Powell “may describe recent inflation developments as encouraging, but also downplay their relevance given uncertainty ahead due to tariffs, fiscal policy, and the recent spike in the oil price due to geopolitical developments.”

The overall expectation from Wall Street is that there will be no change in the base rate, but here are some of the headline factors which may be influencing Chair Powell’s final decision to be announced later today.

Problem 1: Oil

Tensions in the Middle East are escalating by the day after Israel and Iran launched attacks on each other, with both sides targeting senior military officials.

Despite saying the U.S. wouldn’t wade into the conflict, President Trump posted on his social media site, Truth Social, yesterday that “we now have complete and total control of the skies over Iran,” and suggested Iran’s leader, Ayatollah Ali Khamenei, is an easy target despite being in hiding. Khamenei wouldn’t be “taken out … for now,” Trump added.

The escalating tensions in the Middle East pose a question over oil supply, with Iran threatening to close the Strait of Hormuz. The oil flow through the strait accounts for about 20% of global petroleum liquids consumption, writes the U.S. Energy Information Administration.

Vikas Dwivedi, global energy strategist at Macquarie, wrote in a note seen by Fortune: “We expect oil prices to remain volatile with an upward trend for the next few weeks as both Iran and Israel maintain their military intensity. Regardless of military or diplomatic progress, we expect Brent to rally towards the low $80 level before hitting a plateau as the perceived risk of actual oil supply disruption becomes largely discounted.

“From the low $80 plateau, the next price move will, in our view, be driven by what happens to Iranian oil export infrastructure. If it is damaged or destroyed, we believe oil will trend towards $100 due to the direct loss of Iranian exports and the risk premium associated with Iran’s response, including the blockage of the Strait of Hormuz.

“There will likely be selloffs on hopes for diplomatic solutions, profit-taking, and new shorts, but we expect those to be bought until the market ascertains the risk to oil supply.”

None of this makes Powell’s life any easier, as oil is a key factor determining the rate of inflation in the U.S.

Problem 2: Policy uncertainty

Policy out of the White House is also adding further uncertainty to the already blurry picture.

Trump’s “Big, Beautiful Bill” has raised eyebrows about the amount it could contribute to U.S. national debt, despite some deficits being offset by inflationary but moneymaking tariff policies.

The lack of action from the Oval Office isn’t impressing Moody’s, which downgraded U.S. debt a month ago to Aa1 from Aaa. That’s an issue for Powell, with the move pushing Treasury yields up, creating higher borrowing costs for the government that potentially have trickle-down inflationary impacts on consumers.

But as Deutsche Bank’s Jim Reid wrote in a note shared with Fortune this morning: “Ahead of the Fed’s decision, U.S. Treasuries rallied yesterday, on flight to quality, and as the weak data cemented the view that rate cuts were still likely in the months ahead.

“That meant yields fell across the curve, with the two-year yield (–1.5 bps) down to 3.95%, whilst the 10-year yield (–5.7 bps) fell to 4.39%. The outperformance of long-end bonds came after news that the Fed will be holding a meeting on June 25 to discuss changes to the supplementary leverage ratio, which may allow banks to hold more Treasuries.”

Another question is, of course, tariffs, with Powell already signaling he is waiting to see if businesses pass on increased costs to consumers.

Thierry Wizman, global FX and rates strategist at Macquarie, pointed out that level inflation data after the “Liberation Day” tariff announcements wasn’t a signal to bank on, writing the “low May CPI [consumer price index] print isn’t because tariffs don’t matter for measured inflation. Tariffs do matter, or will matter.

“Rather, inflation retreated because underlying notional demand has weakened … We still lean toward the view that Jay Powell will sound more ‘dovish’ next week than he did in May. We believe that were it not for the uncertainty caused by the tariffs, the combined information coming from the inflation and labor-market data would have compelled the Fed to have resumed cutting its policy rate by now.”

Problem 3: Trump

Powell also has to weather the storm that may come in the form of President Trump, who has made it clear that he wants the Fed to cut rates.

While Trump has stepped back from threats that made the market worry that the Fed’s independence might be under threat, he has made no secret of the fact he wants “too-late Powell” to cut the base rate.

Powell, on the other hand, has maintained that politics have absolutely no impact on the Fed’s decision-making.

Despite threats from Trump that he may threaten Powell over the lack of action, Richard Clarida, the former Federal Reserve vice chair from 2018 to 2022, said the White House will stop short of materially altering the central bank’s independence.

“We may be going to a world where the Fed loses some power in the regulatory sense,” Clarida told MarketWatch in an interview published yesterday. “But it looks like the Fed retains independence to raise or lower interest rates.”

On the chairman to follow Powell, Clarida added, Trump’s nomination will not be the only factor: “I think markets can have a say,” he explained, highlighting stocks and bonds would be in for a shaky ride if the candidate for Fed chairman wasn’t viewed as truly independent or committed to bringing inflation down.

This story was originally featured on Fortune.com

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• Unemployment rates for recent college graduates have surged in recent data, with the rate for those holding a bachelor’s degree rising to 6.1%—and even higher for those with advanced degrees or some college but no degree—contrasting with a national rate of 4.2%. This may strengthen the argument of top CEOs like Jamie Dimon, Ted Decker, and John Furner who have urged young people and employers to prioritize job-ready skills and alternative career paths over traditional college degrees.

Graduates choose to attend college instead of heading straight into the workforce for a range of reasons, be it furthering their studies in a specific field or gaining qualifications needed for a certain role. But their motives often boil down to one thing: landing a career in the profession of their choice.

It seems that in 2025, those dreams are falling flat.

According to the most recent data published by the Federal Reserve Bank of St. Louis (FRED), the unemployment rate for college graduates with a bachelor’s degree sat at 6.1% in May—up from 4.4% just a month prior.

Likewise, the unemployment rate for those ages 20 to 24 with some college experience but no degree, as well as those of the same age demographic with a master’s degree or higher, spiked last month.

FRED reports that Gen Z with a master’s or higher now have an unemployment rate of 7.2% while those with some college experience have an unemployment rate of 9.4%.

According to analysis by the Wall Street Journal, that picture is even more dire. Citing micro data from the Labor Department, the WSJ estimates graduates have an unemployment rate of 6.6% over the past 12 months ending in May, the highest level in a decade with the exception of the pandemic spike.

This trend of increasing unemployment is at odds with the picture of the rest of the U.S., where unemployment held steady at 4.2% from April to May, elevated only a little from the rate 12 months ago.

It’s perhaps no surprise then that the graduates who do land entry-level jobs tend to stay in them, for fear of being stuck in a stagnant market. Meanwhile, grads who didn’t land a role find it difficult to get a foot onto the career ladder.

As researchers from Oxford Economics reflected in a study last month: “Those in the professional, scientific, and technical services are less likely than their peers to seek employment in a different industry, though they are more likely to accept underemployment—defined as a college graduate who is employed in a job where more than 50% of workers in the same role do not have a bachelor’s degree or higher.”

Indeed, while some young potential staffers are willing to take sideways steps in order to earn an income, the analysts suggested Gen Z grads are having a harder time than most: “The upshot is that the unemployment rate for recent college graduates will remain elevated in the near term without a surge in demand from tech companies or a mass exodus from the labor force by these individuals, both of which seem unlikely.

“While these workers only account for around 5% of the workforce, they have played an oversize role in pushing the national unemployment higher.”

Alternative routes

An argument could be made that the data suggests employers aren’t finding the skills they need in newly minted grads, despite the tens of thousands of dollars many will have forked over to achieve their degrees.

JPMorgan Chase CEO Jamie Dimon, for example, has pushed for education reform to rank colleges based on whether its students land jobs as opposed to how many of them graduate.

“If you look at kids they gotta be educated to get jobs. Too much focus in education has been on graduating college…It should be on jobs. I think the schools should be measured on, Did the kids get out and get a good job?” Dimon told Indianapolis-based WISH-TV last year.

The idea that college is the only way to land a well-paid job is also inaccurate, he added, saying 17-year-old bank tellers can take home $40,000 a year “and if you happen to have a family at 18 or whatever, you get $20,000 in medical benefit for your family. You can be a welder, you can be a coder, you could be cyber, you could be automotive—all of those jobs are $40,000 to $60,000, $70,000 a year.”

Dimon, a veteran of Wall Street, has also argued educators should focus on skills which will stand individuals in good stead for the rest of their lives such as nutrition and financial literacy.

The JPMorgan Chase boss isn’t alone. In a WSJ op-ed last year titled “Not Everyone Needs a College Degree,” the CEOs of Home Depot and Walmart U.S., Ted Decker and John Furner, wrote: “Young people have been told for decades that achieving the American dream requires a college degree…While a college degree is a worthwhile path to prosperity, it isn’t the only one.”

They added: “The American dream isn’t dead, but the path to reach it might look different for job seekers today than it did for their parents. We owe it to younger generations to open our minds to the different opportunities workers have to learn new skills and achieve their dreams.”

This story was originally featured on Fortune.com

• Trump’s former Commerce Secretary, Wilbur Ross, warns that while the U.S. has achieved notable progress in trade negotiations, overconfidence could lead American negotiators to push too hard for concessions foreign governments cannot make. He is particularly concerned that “chesty” tactics with complex partners like the European Union could stall agreements—something Jamie Dimon has warned could ultimately strengthen America’s rivals.

As the world’s largest economy, America can be fairly confident in its negotiating power with trading partners. However, the Trump administration cannot overplay its hand as it may result in allies being pushed into the arms of rivals, according to experts like former Commerce Secretary Wilbur Ross and JPMorgan Chase CEO Jamie Dimon.

This is a scenario which Dimon has sounded the alarm on since Trump made his tariff agenda public. Writing in this year’s letter to shareholders, the “white knight of Wall Street” wrote that America first is “fine” as long as it doesn’t result in “America alone.”

Meanwhile Ross, President Trump’s former commerce secretary, is concerned that the administration’s Achilles’ heel may prove to be its confidence—potentially spurred by quickly signing framework deals with the likes of the U.K. and China.

Ross said that overall he believes President Trump and his team are handling negotiations well and have already achieved some major goals. But he added his one fear is that the government may get too “chesty.”

He told Fortune in an exclusive interview: “The very fact that they’ve made as much progress as they have shows the basic power of the U.S. to get people to come around.

“In fact my one fear is that if our government feels too chesty with their progress, they may overplay the hand and get to levels that are hard—maybe even impossible—for the other countries to give in. That’s my biggest worry right now, because it’s easy to get carried away with early successes.”

As well as a deal with the U.K. being reached and a framework with China, positive signals are also coming out of talks with India and Japan.

“What I think is very important [is] … even though they’ve taken initiatives with some 70-odd countries, in reality, there are only about four or five that make a lot of difference because they’re the ones that move the needle, and [Trump] seems to be doing pretty well,” Secretary Ross added. 

“With, I would say, the exception of the EU … It’s very difficult for the EU to make trade concessions because it‘s not really one entity. You’ve got the 27 member states, and each one of those has a different set of objectives, but each one has veto power, so it’s very tough to get a deal with the EU.”

The EU may be one of the “slower” deals, he added, while Japan, China, and Vietnam he expects to be “fairly quick.”

Problem areas

The European Union, which Trump has previously claimed was created with the sole purpose of working against America, is among the regions most likely to pose a problem if the Oval Office is too confident in its approach, said Secretary Ross.

Already, the president has vented his frustrations with a lack of progress when it comes to negotiating with the EU, previously posting an outburst on Truth Social saying the EU would be facing a 50% tariff because of its lack of action. This 50% tariff was then paused for 90 days.

When asked by Fortune which region may lead to a stalemate in talks, Secretary Ross said: “The EU is definitely a possibility, simply because it’s hard for them to take a united front. 

“But someone like a Vietnam, on whom he has imposed huge tariffs … That one frankly surprised me a little bit in that the reason our trade deficit suddenly shot up with Vietnam is there was a lot of factory movement from China to Vietnam.”

Keeping the European Union close in particular is a key concern of Dimon’s, on account of its history and the potential fragmentation of the bloc.

“This is going to be hard, but our country’s goal should be to help make European nations stronger and keep them close. If Europe’s economic weakness leads to fragmentation, the landscape will look a lot like the world before World War II,” he wrote earlier this year. Such fragmentation, over time, would increase European dependency on China and Russia, essentially turning Uncle Sam’s former allies into “vassal states” of its rivals.

This story was originally featured on Fortune.com

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• Former Commerce Secretary Wilbur Ross, a key architect of Trump’s first-term economic agenda, explains that the administration’s use of tight 90-day deadlines and tariff pauses is both a negotiation tactic and a way to fit the political calendar, particularly before Congress shifts focus to mid-term elections. Ross acknowledges that while these deadlines have been effective in speeding up trade talks and showcasing U.S. leverage, their repeated use may be losing impact as negotiating partners begin to expect extensions rather than serious penalties.

When it comes to renegotiating deals with foreign economic powers, time is of the essence for the Trump 2.0 team.

Not only will tight timelines keep pressure on negotiations to resolve quickly, it also shows voters that the White House has the entrepreneurial wherewithal to make things happen on a rapid timescale.

President Trump has wielded breaks in tariffs of approximately three months a number of times. Most notably, having announced his ‘Liberation Day’ tariffs in early April, a week later he announced all proposed rates would be cut back to 10% for 90 days.

The same has since been announced for China, with both Beijing and Washington D.C. agreeing to lower rates by 115% respectively while talks continue.

And a combination of external pressure, but more importantly internal optics, is precisely why the president has developed a penchant for 90-day pauses.

That’s according to Trump’s former Commerce Secretary, Wilbur Ross, who served in the first administration after being appointed in 2017.

Secretary Ross was a key architect of Trump’s economic agenda in his first term, overseeing the introduction of tariffs on China and the renegotiation of trade with Canada and Mexico.

He told Fortune in an exclusive interview that while a deadline helps in trade talks, Trump is also likely eyeing his own political calendar.

He explained: “There’s nothing like a deadline to encourage people to negotiate seriously. I think it’s right that he did it.”

But further “it fits the congressional timetable”, Secretary Ross explained: “I think he felt that he had to get this out there and try to get it in place early, because by around September everybody in the Congress is mainly going to be focusing on the mid-terms and therefore, the chances of them doing anything controversial are small.

“In history the senators always had a big voice in tariffs—so far he hasn’t given them any voice, and there’s always the danger that they will suddenly start to exert a voice. So I think he wanted to get that out of the way.”

Secretary Ross added that with a bit of “slippage” on 90-day pauses, deadlines get “very close to September.”

Moreover, the banker-turned-Washington-power-player added the tactic of pauses is becoming less of an eleventh-hour reprieve and more of an expectation.

“It was a good tactic and a useful one,” Secretary Ross said. “It gets less useful … because people start to take it less seriously than they did in the beginning.

“So far, I don’t think there’s a single one where he really has imposed a big penalty if he had to make an extension, so it I think it was a useful tool but it’s probably a little less powerful going forward.”

Unusual timelines

Of course, everything about Trump’s tariff timelines is unorthodox: Usually trade deals take years from proposal to sign-off, let alone inking an agreement in a matter of months.

That being said, the Trump team has been scrutinized for whether it could stick to its promises of deals being announced in rapid succession over the summer.

Indeed, analysts have grown increasingly uneasy with Treasury Secretary Scott Bessent’s claim that “first movers” would get better deals after the ‘Liberation Day’ tariffs—especially since agreements that were supposedly “done, done, done” have yet to materialize.

So far the framework of a deal has been reached with the U.K. while a truce with China has been declared, but more comprehensive agreements are yet to be revealed.

“When you consider the fact that historically it takes years, not weeks, to negotiate individual trade deals, these are going at lightning speed,” Secretary Ross said. “The very fact that he’s gotten this far is pretty amazing, especially because we don’t have that much bandwidth. The whole U.S. trade rep staff, the entire staff, counting the receptionist, there’s only about 200 people, and they have lots of other tasks to do [like] monitoring old agreements and such. 

“Even Commerce has a limited number and so does Treasury, so the very fact that they’ve made as much progress as they have shows the basic power of the U.S. to get people to come around.”

This story was originally featured on Fortune.com

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