Finimize - 🦷 Byte(Dance) the dust

What’s going on here?

The US made progress on a bill that would force TikTok-owner ByteDance to ban or sell the US arm of the video-sharing app, a blow to budding short-form social media stars across the states.

What does this mean?

The US has long been suspicious of TikTok’s ability to make a generation commit interpretative dances to memory and mix flavored syrups into water. So, wary that data tracking the eyeballs of millions of Americans could land in the Chinese government’s hands, the US House of Representatives approved a bill that could ban TikTok from stateside app stores unless ByteDance, its Chinese owner, sells it off. The Senate would need to pull out its “approved” stamp, too – but a line of buyers will be ready and waiting. Tech giants Microsoft and Oracle already scoped out TikTok when a ban was floated two years ago. They’ll need to start saving up, though: with ByteDance’s valuation hovering around $268 billion, TikTok’s US arm could go for up to $50 billion, trumping the $44 billion Musk shelled out on Twitter.

Why should I care?

Zooming out: Deals go both ways.

Mind you, China might block the sale of TikTok’s US business. The social media site’s algorithm is the golden dust of the user engagement world, so China wouldn’t exactly be rushing to hand over its secret sauce. The government could also hit back at the US with its own restrictions. That said, major platforms like Facebook, Instagram, WhatsApp, Reddit, and YouTube have already been banned from doing business in China.

The bigger picture: TikMock.

That bill could be money in the bank for Meta. The social media titan’s “Instagram Reels” feature is a TikTok look-alike, so it would suddenly be the go-to spot for anyone with an attention span that can only be satisfied by extra-short-form content. YouTube could make a dime off the change, too, thanks to its “Shorts” video feature.

What’s going on here?

Japan’s biggest union group shook on stronger-than-expected wage deals, which could put the country’s infamously lazy prices to work.

What does this mean?

Japan’s economy has been held back by dormant inflation for decades, despite the government and central bank’s best efforts to inject some life into stagnant prices. Finally, though, the economy might move in the right direction. Rengo, an umbrella group of unions, said its members have secured the biggest pay hike in over 30 years, which should see the average wage pick up by 5.28%. That’s a biggie: paychecks influence how much folk spend, where retailers set their prices, and the amount of money circulating the economy. Whether that’ll be enough to reverse the decade-long trend remains to be seen, however.

Why should I care?

For markets: Stick it in reverse.

The Bank of Japan (BoJ) has all but drained its bag of tricks, flooding the economy with cash, sticking to sub-zero deposit rates, and even adjusting long-term interest rates – a move usually left to the markets. But now that wages might pull inflation and the economy up along with them, some analysts believe the central bank might be able to pause its more aggressive policies as soon as next week. That’s not a one-meeting-and-done resolution, though: the choice to change its stance would be the first of many decisions the BoJ would need to make – not least where to pitch interest rates and how to manage its colossal bond portfolio.

For you: The bets are in.

Big-buck traders aren’t waiting for the i’s to be dotted, they’re already adjusting their portfolios. That includes buying more Japanese stocks which would benefit in a stronger economy, and the yen which would do well under higher interest rates. The “widowmaker” trade is back in vogue, too: traders are betting against Japanese government bonds, a strategy that has historically bitten back by landing investors with major losses.