Brew Markets — Episode Summary

Episode: Lab Grown Diamonds for Christmas & Costco Joins Tariff Lawsuits
Date: December 2, 2025
Host: Ann Berry
Podcast: Brew Markets (by Morning Brew)

Overview

This episode dives into key stock market stories influencing investors and consumers right now. Host Ann Berry covers three primary topics: the landmark Omnicom-IPG advertising merger, Signet Jewelers’ adaption to lab-grown diamond trends, and Costco’s legal moves regarding tariffs imposed during the Trump administration. The episode closes with quick market news including Boeing’s rising fortunes and Michael Dell’s massive philanthropic pledge for “Trump Accounts.”

1. Advertising Industry Shakeup: Omnicom–IPG Merger

Key Discussion (00:32–05:51)

• Deal Overview:

  • The $13.5 billion all-stock merger of Omnicom Group and IPG cements the new entity (still Omnicom, ticker: OMC) as the largest advertising and marketing services company globally, with over $25 billion in revenue and $3.3 billion in cash flow expected annually.
  • The merger seeks cost efficiencies and unified audience insights — boasting a database of 2.6 billion verified IDs to target real consumers, necessary in a space where digital ad fraud proliferates.

• Competitive Pressure & Rumors:

  • “It’s a trillion-dollar market growing at 5 to 6% per year, but there are two distinct worlds inside it,” Ann notes, explaining that $700 billion is in fast-growing digital (10–20% growth) while the remaining $300 billion in traditional media is declining.
  • Martin Sorrell, industry veteran, described legacy companies as “two drunks propping up each other on a lamppost.” (02:25)

• Integration Risks:

  • Omnicom’s stock is down over 30% since the deal was announced. There’s nervousness about smoothing integration for major clients (Apple, McDonald’s, Nike, General Motors, Microsoft).
  • Immediate layoffs (4,000 so far, possibly 10,000 more to come) and an internal agency reshuffle causing industry turbulence.

• The Wait & See:

  • Omnicom will debut its “next-gen strategy” at January’s Consumer Electronics Show, with more details for investors expected in February’s earnings report.

Notable Quote:

• Ann Berry:

  “His description of the industry succinctly sets the stage for why this merger has happened in the first place… [it’s like] ‘two drunks propping up each other on a lamppost.’” (02:25)

2. Signet Jewelers’ Sparkle: Lab-Grown Diamonds and Holiday Retail

Key Discussion (06:23–15:36)

• Signet Snapshot:

  • Operates under brands like Kay, Zales, Jared, and Blue Nile; market cap near $4 billion; up 15% year-to-date and over 200% in the last five years (06:44).
  • Earnings beat: Sales rose 3% YoY to $1.4 billion; fourth straight quarterly beat, with same-store sales up 3%.
  • Stock still dropped 4% due to a “cautious outlook” from company leadership citing “potential continued softness in consumer confidence.” (09:25)

• Holiday Spend & Consumer Trends:

  • Biggest season is Christmas (even more than Valentine’s Day); most sales occur in the 10 days prior (10:14).
  • Increase in lower-priced jewelry items: “Eight times as much inventory in the sub-$500 to sub-$1,000 area than they did last year.” (10:34)

• Lab-Grown Diamonds (LGDs):

  • Fashion category penetration doubled YoY — now 15% of fashion sales.
  • CEO: “We continue to see runway in the fashion category, particularly in lab grown diamonds or LGDs.” (11:31)
  • Affordable: “Price point too, actually below $1,000 compared to last holiday.” (11:54)
  • Ethical/environmental appeal: Lab-grown offers certainty on “no misuse of labor,” but there are energy-use concerns.

• Diamonds vs. Gold:

  • Observations that gold retains value even when “ugly and broken,” while diamond resale value remains debated.
  • Personal story: John re-used a broken gold brooch toward wedding jewelry purchase (13:13).

• Celebrity Effect:

  • Taylor Swift’s engagement drove a spike in Signet shares:

    “Signet shares rose nearly 10%... just because there was this anticipation that more women would want to go and get a cushion cut diamond ring…” (14:40)

Notable Quotes:

• Ann Berry:

  “It’s interesting, many different industries are really now catering towards making sure that they've got specific merchandise or specific items for specific demographics.” (10:45)

• John (Co-Host):

  “I recently bought a diamond engagement ring… I made a decision to buy one that isn’t lab-grown. But the other part of that is the gold that is part of the band. The CEO pointed out that consumers are still buying gold jewelry because they understand its value.” (12:47–13:08)

3. Big Retail vs. Tariffs: Costco Heads to Court

Key Discussion (15:46–17:55)

• Background:

  • Costco is suing for tariff refunds related to the Trump administration’s emergency tariff powers, joining other companies like Revlon and Kawasaki Motors.
  • Recent Supreme Court hearing challenges the legality of those tariffs, questioning if the President overstepped by using the International Emergency Economic Powers Act rather than Congressional authority.

• Potential Refunds and Uncertainties:

  • The process and possibility for tariff refunds remain murky — even if overturning happens, the path for recouping money is complex and court-dependent.

• Retailer Responses:

  • Costco (like other companies) mitigates tariffs by shifting sourcing and selective price increases.
  • AutoZone, Adidas, GM, Apple have all altered supply chains or passed costs onto consumers in response.

Notable Quote:

• Ann Berry:

  “Look, this tariff piece, it’s not been top of the headlines lately, but it’s certainly not going away.” (17:55)

4. Quick Market Wrap & Headlines

Key Discussion (19:38–21:11)

• Market Close:
  • S&P 500: Up 0.25%
  • NASDAQ: Up 0.6%
  • Dow: Up 0.4%
  • Boeing surges ~10% after winning a $104M Navy contract and positive cash flow guidance for 2026.
  • Instacart (Maple Bear): Falls 4% after Amazon announces ultra-fast grocery delivery test markets; Instacart also sues NYC to block worker protection/labor laws.

5. Philanthropy and Financial Literacy: Michael Dell’s $6.25B Gift

Key Discussion (21:11–23:36)

• “Trump Accounts”:

  • Michael and Susan Dell pledge $6.25 billion to fund savings/investment accounts for 25 million American children under age 10, focusing on those in less affluent zip codes.
  • Money is invested in index funds, withdrawable by recipients at age 18 for key life expenses.

• Personal Reflection from Ann:

  • Considers gifting young relatives U.S. stock market investments:

    “Because I am a big believer that investing… is a path if we invest and hold over term to… a nest egg for young people.” (22:44)

Memorable Moments & Quotes

• "Two drunks propping each other up on a lamppost." — Martin Sorrell on legacy ad agency mergers. (02:25)
• “Every kiss begins with K.” — Reference to Signet’s famous Kay Jewelers jingle. (06:44)
• Taylor Swift Effect: “Signet shares rose nearly 10% in the following days…” (14:40)
• Lab-Grown Diamonds Uptick: “LGD now, that’s what they’re called now, which expanded penetration to 15% of fashion sales this quarter, roughly double last year.” (11:31)

Timestamps & Key Segments

• 00:32–05:51: Omnicom-IPG mega merger analysis
• 06:23–15:36: Signet Jewelers earnings, lab diamond trends, gold’s enduring value
• 15:46–17:55: Costco litigation over tariffs
• 19:38–21:11: Quick market wrap with focus on Boeing and Instacart
• 21:11–23:36: Michael Dell’s philanthropy and the next generation’s investment opportunities

Tone & Style

The hosts maintain an upbeat, conversational tone, mixing sharp business insights with accessible cultural references (“Every kiss begins with K,” Taylor Swift, snack wraps at McDonald’s). Ann Berry blends macro analysis (“trillion dollar market”) with relatable personal anecdotes and pop culture, making dense financial news lively and approachable.

In summary:
This episode explored seismic shifts in advertising, changing jewelry retail tastes, and the downstream effects of tariffs on major American companies. It highlighted how traditional business models face pressure from digital disruption, consumer trends, regulatory uncertainty, and even celebrity influence — all wrapped up with market optimism and a massive philanthropic gesture geared towards future investors.