Notes From the Terminal at 11:47 PM

February 21, 2026

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There's a specific flavor of market week that doesn't have a name yet. It should. Call it a compression week — one where five different crises run simultaneously, none resolves, everything matters, and by Friday you're holding a cup of cold coffee wondering if you understood any of it correctly.

We just had one of those.

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Start with Walmart. They reported Thursday morning, Q4 fiscal 2026: $190.7 billion in revenue, beat on top and bottom line, Walmart Connect advertising up 41% year over year, e-commerce finally — finally — printing a profit. A $30 billion buyback on top of it. The 53rd consecutive annual dividend increase. Read those numbers again. Fifty-three years. The company existed before GPS. Before the internet. Before email. It has raised its dividend while humans figured out how to send information through cables and also how to destroy the ozone layer and then partially fix it.

So the stock fell.

Because the guidance came in at $2.75–$2.85 adjusted EPS for fiscal 2027, against a street expectation of $2.96. Eleven cents. The market, which had priced WMT at 45 times forward earnings because it decided this is now a tech company rather than a box store, looked at eleven cents of missed guidance and said: unacceptable. Down it went.

The more interesting thing buried in the call — and you have to dig for it, it's in the CFO comments — is the K-shape data. Higher-income households are doing fine. They're choosing Walmart now because Walmart got faster and nicer and built an actual delivery network. Lower-income households are feeling squeezed. Spending selectively. Looking for deals within the deal store. The new CEO mentioned pressure on the "lowest income cohort" with all the discomfort of someone describing weather at a funeral. The SNAP disruption from the 43-day government shutdown is supposedly rebounding. "Starting to rebound," he said. Starting. As in: not yet.

Tax refunds are expected to be 44% larger than prior years due to how the 2025 deductions were structured. If that liquidity hits in March and April, Walmart is positioned to capture it. The bull case is real. But the caution is also real, and management's tone — coming off a record revenue year — should tell you something about what they're actually seeing on the ground. These people have 2.1 million employees and 280 million weekly customer visits. They see the economy before the data does.

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Meanwhile, Bitcoin has been staging one of the uglier slow-motion corrections in recent memory.

From $122,000 at its 2025 peak to roughly $68,000 this week. A 44% drawdown. Altcoins worse. SOL is at $81, ETH is grinding around $1,970, XRP at $1.39. The Fear & Greed index has been in single digits. Not "caution." Not "mild concern." Single digits. The kind of number that either means capitulation is near or that there's another floor to fall through, and the only honest answer is that you won't know which until it's already happened.

The Strategy (MSTR) situation is its own dark theater. The company holds 714,644 Bitcoin against a cost basis of approximately $76,056 per coin. Bitcoin is trading well below that. Which means the world's largest corporate Bitcoin holder is sitting on an unrealized loss of somewhere close to $6 billion depending on the day you run the math. Q4 earnings filed earlier this month: $12.44 billion net loss. Driven by a $17.44 billion unrealized markdown on digital assets under the new FASB fair-value accounting rules.

Canaccord Genuity's analyst — who had been one of the most vocal bulls on the stock — slashed his price target from $474 to $185. Maintained the Buy rating, which suggests either deep conviction or a complex personal relationship with being wrong. MSTR is down 72% from its November 2024 all-time high. Down 62% over the past year. And the company keeps buying. 1,142 BTC purchased at $78,815 average two weeks ago, funded by ATM share issuance, right before the price fell another leg. Timing so bad it becomes almost artistic.

The deeper question nobody wants to sit with: if the thesis is correct and Bitcoin goes to $175K or $250K like some institutional forecasts suggest, MSTR will look like the most prescient capital allocation in corporate history. If Bitcoin goes to $40K — which its technical structure does not rule out — the leverage embedded in the balance sheet becomes a different story entirely. The ATM programs still have over $8 billion in capacity. They can keep diluting. Shareholders absorb it. The bet stays on. There is no clean off-ramp.

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Here's what I keep coming back to: the stablecoin cap is now $300 billion. Hashdex thinks it doubles in 2026. Pantera thinks the structural underpinning is sound. Grayscale believes the four-year cycle is officially over and this is now a sustained accumulation phase driven by institutions rather than retail momentum. Harvard Management Company has crypto in its endowment. Mubadala has crypto in its sovereign wealth fund. 67% of professional investment managers still have zero exposure, per a Bank of America institutional survey.

You can hold two thoughts at once: the structural case for digital assets becoming embedded financial infrastructure is genuinely compelling, and the near-term price action is genuinely terrible. These are not contradictions. Asset classes do this. They arrive at their eventual destination through paths that would have made early travelers turn back. The question is always whether you have the balance sheet — personal or institutional — to survive the path.

Most people don't. Most people sell at $68K because they bought at $95K and the number hurts. That's not strategy. It's just pain management.

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The macro backdrop hasn't gotten easier.

Core PCE came in hot. Q4 GDP disappointed. The Fed is paused and communicating nothing that approaches clarity. Tariffs are either dead, reborn, or both depending on the hour you checked the news on Friday. Treasury yields are holding with the stoicism of someone who has decided not to have a reaction anymore. Dollar strength persists. Brent crude near $72 on Iran tensions that sit unresolved — a two-week deadline that was issued without public clarity on what enforcement actually looks like.

NVDA reports Wednesday. The market will use it to have feelings about AI. This is quarterly now, like the seasons.

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If you asked me to name the single most structurally important thing that happened this week, I'd skip the Supreme Court ruling — that's a legal story dressed as a market story — and go with the Walmart guidance miss.

Because what Walmart's CFO described on that call is the actual texture of the American economy right now: a consumer who is still spending, but spending defensively. A wealthy cohort drifting toward value. A lower cohort under measurable pressure. A company generating record revenue while projecting caution. That combination — top-line resilience, bottom-up anxiety — is the tension the Fed cannot quite resolve. You can't cut into it without risking the wealthy-consumer-driven inflation. You can't hold too long without grinding the pressure group further into the floor.

The K-shape is no longer a description. It's the operating environment. And almost every earnings call, every guidance revision, every consumer sentiment reading is essentially a dispatch from inside it.

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None of this is investment advice. It's the view from the terminal at midnight, which has never been accused of optimism.

Sleep well.