TikTok Got Bought (Probably), and Everything Broke

A Visceral Tour of Markets Unraveling on Fundamentals

Thursday morning I watched Oracle stock gap up 5% in pre-market. By afternoon it was up 6.5%. The TikTok deal—this five-year geopolitical circus that had killed the stock once a week for months—suddenly happened. Oracle, Silver Lake, MGX. Binding agreements. Closing date January 22, 2026. One day before Trump's enforcement deadline expires.

I read the TikTok CEO memo three times.

What struck me wasn't the deal itself. It was this line: ByteDance still owns the algorithm. The underlying recommendation engine. The secret sauce. The thing that makes 170 million Americans scroll for six hours a day without noticing. Beijing owns it. Oracle just gets to... watch it work. Audit it. Manage the data. Like a security guard hired to supervise something he doesn't control.

And the market cheered.

The reason matters: this deal erases a tail risk that had been quietly eviscerated people who understand regulatory law. TikTok is now a known problem with a legal framework. That's worth something to capital allocators, even if the framework itself is theater. Even if the algorithm still belongs to Beijing. Even if everybody knows Larry Ellison is a Trump buddy and this whole construct could collapse if the political winds shift 15 degrees.

Certainty, even false certainty, is a drug in November markets.

Meanwhile, in Tokyo, Someone Just Pulled the Fire Alarm

The Bank of Japan raised rates to 0.75% on Friday. Highest in 30 years. This was expected. Governor Ueda had telegraphed it. Markets had priced it. Economists had unanimously predicted it.

And then something weird happened: the yen weakened after the announcement.

You know what that means? The entire world was expecting an aggressively hawkish signal—language suggesting faster hikes, clearer guidance on the terminal rate, maybe even a shadow admission that Japan's done with stimulus forever. Instead, Ueda spoke in careful bureaucrat-ese. "Real rates remain significantly negative." "Accommodative financial conditions will continue." "We'll assess the pace of hikes going forward."

Translation: We're hiking, but we don't know how fast, and we're definitely worried about breaking something.

The market's reaction was brutal. If the BoJ had sounded tough, yen rallies. If it had sounded dovish, yen tanks. But it sounded confused, and yen got sold anyway because everyone left the press conference not knowing what comes next.

Here's why you should care: Japan is the world's largest net creditor. For decades, its central bank kept rates near-zero, and Japanese institutional investors—pension funds, insurers, life companies—deployed trillions into foreign bonds. US Treasuries. German Bunds. Anything yielding more than Tokyo offered.

Now that spread is compressing. JGB yields hit 2% on the decision day. If Ueda keeps hiking, that incentive for capital repatriation strengthens. Japanese money that's been funding US deficits might stay home.

The US 10-year Treasury yield sits at 4.15%. If Japanese buyers step back, where does that yield go?

S&P 500 futures got creamed overnight Thursday. Nasdaq dumped hard. Then Friday morning, some combination of Fed-cut-hope, soft CPI nostalgia, and short-covering whipped sentiment back up. The volatility wasn't random. It was the market realizing—very slowly, very painfully—that the old playbook (everybody cuts together, assets rally forever) is dead.

Nike Got Eviscerated, and It's a Symptom

Nike reported Friday. Revenue in China down. Tariffs are murdering gross margins. Stock dove 10.5%.

This is what tariff inflation actually looks like when it shows up in real P&L. Not abstract. Not a forecast from some think tank. Just a shoe company saying, "China sales are getting destroyed, and Trump's levies made our costs unsustainable."

The market's reaction was clinical: rotation out of discretionary, into utilities and defensive names. Boring stuff held up. Growth names that depend on China exposure got shellacked.

But here's what nobody's saying loud enough: The tariff dynamics are re-pricing the entire equity market, and we're still in the early innings.

If you own retail, if you own consumer goods, if your supply chain touches China, Friday was a warning shot. Nike's miss signals that when companies start reporting Q1 2026 numbers, the tariff story becomes undeniable in the earnings sheets.

The Medline IPO Pop: A Sign of What

Medline went public Thursday at $29, popped to $35, valued at nearly $51 billion. Biggest IPO since 2021. The underwriters are crowing. Wall Street is calling it a "market inflection."

It's also a sign that banks believe they can move capital into anything—even boring medical supply companies—as long as there's liquidity and a narrative.

Medline makes gauze. Hospital beds. Syringes. Nothing AI-related. Nothing sexy. But it came out 26% above the IPO price because capital is sloshing around, looking for anything that isn't a sword of Damocles with a Chinese parent company or mounting tariff exposure.

The IPO pop says: There is still money. It's just getting more selective. It's running toward defensive narratives. And it's fast.

The Fed Didn't Cut, But Markets Priced in Cuts Anyway

This is the part that wakes me up at 3 AM.

The Fed held steady Wednesday. Markets shrugged and immediately began extrapolating two, three, maybe four cuts in 2026. Soft CPI (2.7% vs. 3.1% expected). Soft jobs numbers. Soft sentiment data. Connect the dots and you get: The Fed has space to ease.

The Fed didn't say that. Powell's commentary was neutral-to-hawkish. No pivot. No admission of rate-cut readiness.

But the market doesn't care what the Fed says anymore. It cares about whether data gives cover for the Fed to cut. And soft data always does.

The problem is what happens next quarter when data hardens. When tariffs flood through supply chains. When Japan repatriates capital and pushes yields up. When the labor market, which is defended, stays tight. When inflation decides it's not done yet.

Then the Fed cuts anyway, because it has to, and the whole structure becomes a game of chicken between the central bank's fear of recession and the market's fear of inflation.

What You Should Actually Be Watching

One: The BoJ is tightening. That matters more than the Fed holding. Japanese capital flows are about to shift in ways that ripple through global bond markets. Watch JGB yields. When they hit 2.5%, watch whether long-end US Treasuries spike.

Two: Tariff P&L starts showing up in January. Nike was the trailer. CPI and tariff inflation haven't met yet—when they do, growth estimates get repriced. Fast.

Three: The TikTok deal isn't resolved. It's just legally scaffolded. One Supreme Court ruling, one shift in the Trump administration's posture, and this entire structure collapses. Oracle owns nothing of value without Beijing's algorithm license.

Four: Prediction market growth is structurally unhealthy. DraftKings, Robinhood, Kalshi—all seeing explosive volume. Leverage-to-speculation ratios are climbing. One volatility spike and retail margin calls could cascade through systems nobody's monitoring.

Five: Medline's IPO pop signals capital is looking for safety, not growth. The day boring companies outperform exciting ones is the day growth investors stop being greedy and start being scared.

The market rallied Friday on relief. Old narratives. Soft CPI, Fed cuts, TikTok resolved, America keeps winning.

Just remember: every one of these narratives is built on assumptions about what happens next. And the stuff happening next—Japanese capital flows, tariff blowback, central bank divergence, carry trade unwinding—is the stuff that tends to hit fast.

Stay paranoid. It's working.