Morning Brew Daily - Inflation Unexpectedly Cools & What is Going on with Oracle Stock?

Episode Date: December 19, 2025

Episode 739: Neal and Toby explain why inflation unexpectedly cooled in November. Then, Donald Trump’s media business is merging with a Nuclear Fusion company. Next up, why Medline is the stock of the week and Oracle is the dog of the week. Finally the headlines you need to know heading into the weekend.  Subscribe to Morning Brew Daily for more of the news you need to start your day. Share the show with a friend, and leave us a review on your favorite podcast app. Send us your questions for our special Mailbag episode!  Email: [e-mail]  IG: @MBDailyShow Visit public.com/morningbrew to learn more Paid endorsement. Brokerage services provided by Open to the Public Investing Inc, member FINRA & SIPC. Investing involves risk. Not investment advice. Generated Assets is an interactive analysis tool by Public Advisors. Output is for informational purposes only and is not an investment recommendation or advice. See disclosures at public.com/disclosures/ga. Past performance does not guarantee future results, and investment values may rise or fall. See terms of match program at https://public.com/disclosures/matchprogram. Matched funds must remain in your account for at least 5 years. Match rate and other terms are subject to change at any time. Watch Morning Brew Daily Here:⁠ ⁠⁠https://www.youtube.com/@MorningBrewDailyShow⁠ Learn more about your ad choices. Visit megaphone.fm/adchoices

Many employees can't afford a hefty medical bill that pops up out of the blue, but it happens. And employees who are financially stressed are, understandably, more likely to be distracted at work, costing their employers greatly in lost productivity. Luckily, AFLAQ plans help with out-of-pocket expenses not covered by health insurance and can be offered at no direct cost to businesses. Learn more at aflac.com slash morningbreedaly. That's aflack.com slash morning brewdaily. Daily Show. I'm Neil Fryman. And I'm Toby Howell. Today, why Trump's social media company is getting into nuclear fusion. Then that inflation report was amazing. Or was it? It's Friday, December 19th. Let's ride. Happy Friday. I don't know if you've looked at the date recently. It's already December 19th, less than a week to go until Christmas. It's also that time of the year when you

don't feel bad just veging on the couch for the entire weekend. And lucky for you, there's going to be plenty of new content to keep you busy. There's a big boxing match tonight on Netflix, Jake Paul, versus the much bigger Anthony Joshua. The college football playoff begins the NFL is games on Saturday and Sunday. And if you want to leave your house for just a bit, movie theaters are showing the new Spongebob movie and the third avatar. Toby, all that plus some chili on the slow cooker.

Who would say no? I'm not watching any of that, actually, Neil. I recently started watching Stranger Things again, having only consumed the first season, picked it up midway through season three, have literally no idea what's going on. Who is Vecna? But if that content slate that Neil mentioned sounds like the worst thing you've ever heard of,

the winter solstice is on Sunday, which is the shortest day of the year, so you have an excuse to be in bed way before subjecting your eyes to anything that involves Jake Paul or SpongeBob. And now a word from our sponsor, Public. Neil, at 5 a.m., my brain is basically an old-school window startup screen. Same. I'm operating with one functionary.

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description. November inflation data dropped yesterday, and what the heck was that? Annual CPI fell to 2.7% year over year, down from the 3% it's been running at, and way lower than the 3.1% economists expected. On the surface, woo-hoo, some relief for consumers in the lowest inflation print in months. But hold those horses, cowboys, and cowgirls. Broad skepticism emerged across Wall Street and amongst economists who think that this isn't the slam dunk report it initially appears.

The nitpicking is inspired by the fact that the data comes after a 43-day federal government shutdown in which BLS workers were furloughed, meaning November data collection started quite late. Since the CPI relies heavily on in-person price collections, the shutdown severely limited that process. The shutdown clearly had a big impact on data collection. and Heather Long, Chief Economist at Navy Federal Credit Union said, I don't take it at face value. Stephanie Roth,

chief economist at Wolf Research, told CNN, such a sudden stop is very unusual, at least outside of a recession. Paul Ashworth, Chief Economist for Oxford Economics, said in a note. Still, the White House and Wall Street celebrated with stocks opening well in the green before leveling off a bit throughout the day. But that was the general vibe, Neil. Take this whole report with a pretty big grain of salt. Yeah, just look at what analysts titled their reports after this report dropped.

Lost in Translation said TD Securities, Delayed and Patchy Swiss Cheese CPI report. And then another one said, borrowed your salt metaphor and said, take it with the entire salt shaker. There's just a lot of gaps and a lot of skepticism toward this report. A number of other analysts came out and said, you know what, I don't take this at face value, but I also don't dismiss it entirely because if you take it on a whole, there's probably a good sense. that inflation is slowing down in certain categories. But this dramatic drop that we saw, we saw core CPI, which strips out gas and food fall to its lowest level since 2021 at a 2.6% annual rate. Something, that just didn't feel totally believable. That said, there was, you know,

a growing sense that inflation is receding. We just don't know by how much. Let's dive into why people think there were red flags with this particular report. So the government shut down, delayed the release of the November report. also just canceled the October CPA report all together. So that means November's data didn't have a previous month to be compared to. Remember, we are looking for what inflation is doing relative to other months and other years. So if you take away that base comparison, things get a little bit wonky. Also, as I said, November prices weren't collected until towards the end of the month, meaning that some of that information was likely, heavily influenced by holiday discounts,

what starts to happen. Black Friday sales come on longs, come online. So if you're just looking at prices in that particular moment in time, yes, they might appear to be lower. And then a lot of people are just raising their eyebrows at shelter categories as well because it makes up a big portion of CPI. And the fact that it was logged that nearly flat over the last two months, what people are basically saying is let's wait until December comes out. And then we'll probably average the two because then it gives a better snapshot of what actually happened. Yeah, the shelter. data was what economists did pinpoint as the biggest red flag here because they basically zeroed out shelter for October because they couldn't collect it. So they basically said there was no

inflation in rents at all in October. And therefore, there was just no growth in shelter costs at all from September through November. Shelter makes up three quarters of the entire CPI. And that was one of the main reasons that it was brought down to these low historical levels compared to previous months and years. So that shelter costs, if you talk to an economist, they're like, that is the one thing that really showed me that this CPI report was something that we should probably take with a huge grain of salt and we need to wait for December to have a better understanding of what inflation is doing in this economy. But as you are hinting at, it's not a total watch. The general downtrend is probably accurate. So if you are the Fed now, which is who, you know,

looks at this data very closely, you're probably, economists say the Fed may still want to cut interest rates again until they can see more data that is untainted by the shutdown. So again, all eyes are turning towards December. This shutdown had huge effect. I know. I mean, 43 days. And basically, you learn how this data is collected. These people at BLS go out to stores in actual main streets across the United States and just look at what the prices are on the shelves. And they didn't do that until the second week of November until the government was reopened again. And they weren't able to do that. And therefore, we don't really have a great picture of what inflation is doing. Interesting. Okay, history is full of examples of pivots. Netflix went from DVDs to

streaming. Adam Sandler is now a respected dramatic actor, but none may top the news yesterday that Trump Media and Technology Group, the parent company of Truth Social, agreed to merge with a nuclear fusion company. Yesterday, everyone led a collective, huh? When Trump media announced a $6 billion deal to combine with T-A-E, a Googleback company that wants to smash Adams together to generate infinite amounts of clean energy. The company said their tie-up combines Trump media's access to significant capital and TAE's leading fusion technology to supply badly needed power for artificial intelligence infrastructure. And that's where this starts to make a little more sense, or at least, where you can see the reasoning behind it. Trump media isn't going to leverage its social media know-how to help

T-A-E build reactors. It will use its uncanny ability to sell stock to help T-AE fund its ambitious fusion plans. Because if Trump media is good at one thing, it's attracting capital, despite doing just $4 million in revenue a year, its market value is over $4 billion, and it paid its CEO almost $47 million in 2024. Because of the Trump name, apparently, people are happy to throw money at this company. So it's taking advantage of that to make a bet on an experimental technology. Will it work? Who knows? But that's at least the logic. The logic here is that, yeah, We are really good at getting money and what do you need to make fusion a thing money. Let's dive into what this company actually does that.

What is nuclear fusion? How does it differ from nuclear fission? You know, great thing to explain. Yeah, I'm taking out my notepad here. This or this early in the morning. But yeah, fusion is what it sounds like. You're smashing atoms together. Usually hydrogen atoms together.

And this process produces far more energy than fission, which involves splitting atoms apart. it also, when you're doing fission, it ends up producing radioactive waste, which is a headache to deal with. Obviously, it also can lead to reactor meltdowns. Fusion, on the other hand, can't run out of control because if it runs out of energy, the reaction just stops. It just peters out. So it's thought to be a lot more safe. This is what's happening in the sun right now. So it's thought to be, you know, the holy grail of clean energy. So obviously, if you frame it in that sense, you're like, yeah, go after fusion, you know, give it all the capital you need, but no one's ever actually produce a commercial grade

fusion reaction or reactor on Earth, as we know. No, there was a breakthrough in 2022 when this fusion process was created in a lab condition. So there was a little movement a couple years ago. But there does seem to be a lot of attention and money flowing into this sector. Global funding top $7.1 billion across 50 startups as of July. And VC funds are pouring $3.3 billion into nuclear fusion. That was an almost 600% increase over the same period last year. This particular company, T.A.E, has a lot of substantial backers in addition to Trump.

It is considered the oldest and one of the more respected companies in this particular field. It has Alphabet as a backer. Chevron, Goldman Sachs. It's been around the bend. So this is an interesting deal. But I think big picture, it shows that AI is so power hungry. And the winners of the AI revolution will be the ones that are. able to supply the power, create infinite power in the holy grail sense of nuclear fusion to fund all this AI infrastructure being built out because there's a big race between the U.S. and China

about who can deliver the most power for AI. And right now we are not winning that race. At least we have a social media company on the case, though. All right, let's move on to our stock of the week, dog the week, this segment where we pick one stock that did its Christmas shopping in a timely manner and one stock that is panic, re-gifting a candle. I won the pre-show game of Flipcup, up first, and my stock of the week is Medline. Medline, you say, what the heck is Medline? It's a U.S. medical supplies giant that went public this week in the biggest IPO of the year. Price at $29 a share, it opened at $35 before finishing the day at $41 up more than 41%. The market cap at close was $54 billion, which makes it the largest U.S. IPO since Rivian went public back in 2021. Founded back in 1966, Medline

is the definition of a massive but under the radar business. It has 43,000 employees worldwide and offers a catalog of over 335,000 medical and surgical supplies. Think everything from gloves, masks, and scalples to wheelchairs and hospital infrastructure products. It had net sales of $24.5 billion last year, which would already place it amongst the top 500 public companies in the U.S. So why go public? Historically, we've done very little advertising, very little marketing CEO Jim Boyle told CNBC. So the IPO is seen as a way to increase brand awareness and get on more people's radar. Neil, going to go out on a limb and say that unless you've directly been involved in this industry, not many people have heard of Medline. I have not heard

of it. And I want everyone right now to take out the smallest violin that they have because this is a huge win for the private equity industry. Now, people probably don't know this, but the private equity industry has been going through it for the past couple of years. They've been struggling to sell the companies that they've bought and they've been struggling to return cash. And there was this big existential crisis going on for PE. Now, in 2021, there was a leverage buyout of Medline by three massive PE companies, including Blackstone and Carlisle, $34 billion. It was one of the biggest leverage buyouts of all time. The question was, could they get a return on this particular buyout?

Could they take this company public successfully and return cash to their shareholders? Because this was seen as a huge symbol of private equity and whether it was going through, whether it could come out of this huge trough that it was in. And the fact that they did go public and it did pop on the first day is seen as a comeback of sorts for the private equity industry that I know everyone was so sad to see is in the dumps right now. And then now that it's a public company, you know, you or me or anyone can buy stock in it. So how is this company doing right now? There's a few risks that are involved with Medline right now

because tariffs, the majority of Medline's products are source or manufactured in Asia. So there's some big question marks around that in their supply chain. But investors still like the stock. We saw it pop on the first day of trading because this is a market leading company. They have a massive equipment portfolio. And also a lot of people believe that Medline's demand is actually insulated from the broader economy. you're always going to need gloves, you're always going to need scalps, you're always going to need these surgical implements, regardless of what's going on with rates, whatever, regardless of what's going

in the broader economy or consumer sentiment. So in that case, it seems relatively insulated as a business. All right, we're going to take a quick break and come back with Neil's Doggo the Week. Pepsi prebiotic cola in original and cherry vanilla. That Pepsi taste you love with just 30 calories and no artificial sweeteners. Pepsi prebiotic cola. Unbelievably Pepsi. My dog of the week is Oracle, which is setting off more red flags than a guy

who follows a bunch of Instagram models. Shares of the tech giant fell 8% this week, extending a months-long slump that has investors seriously worried about the company's balance sheet and the health of the AI sector more broadly. Oracle's recent troubles began last week when it revealed it would be spending

a lot more than analysts expected on building out data centers. Not a good look for a company that has over $100 billion and growing in debt. Then another whopper came this Tuesday when the Financial Times reported that Blue Owl Capital, which is the primary backer of Oracle's AI binge, was backing out of a planned $10 billion data center in Michigan. Oracle denied the report, but the damage was done since reaching a peak in September, minting its co-founder Larry Ellison, the richest person in the world. Oracle's stock has lost half of its value. Now, this is so. spooky stuff. A growing number of Wall Street experts see Oracle's shakiness as a canary in the

coal mine for the AI trade overall. It's taking on high amounts of debt to build AI infrastructure, but is little to show for return on those investments. The worry is that Oracle's problems will become everyone's problem, given that AI has been the primary engine of economic growth and the stock market this year. Toby, it ain't looking great. It ain't looking great. A lot of people are looking to, you know, boom times of your, specifically the railroad boom, where we started laying railroad tracks before they were trains to actually run on them. Maybe this is what's going on with Oracle right now, where they have all these, you know, commitments and are putting all this money into building out this infrastructure that we don't even know if we need yet.

One three-letter word that I want you to keep in mind is RPO, which stands for remaining performance obligations. This is what happened when Oracle's stock run up happened a few weeks ago where suddenly they reported this massive backlog of deals, but RPO's are contracted sales that are not yet recognized as revenue. In accounting, basically, you need to have a high probability of these things be actually materializing into sales. Usually it's around 70% probability, but that's still a probability. You don't know if they will actually materialize as you expect, especially when a lot of those RPO's are coming by way of OpenAI, which is a private company that doesn't have enough revenue yet to satisfy all of the infrastructure spend that

they've pledged. So that is both a blessing and a curse. When you have this massive backlog, like, hey, this could be all great revenue and it's all going to come in and everything's going to be happy, go lucky, or maybe we're not going to fulfill some of that. And then it's just, you're taking on all this debt for not enough revenue. Yeah, Oracle has $248 billion worth of commitments to Data Center at leases, and it's using a high amount of debt to actually finance that entire infrastructure, all those data centers, you wonder whether those will get actually built or if they do get built, whether there will be any customers for them. And, you know, an increasing number of people are saying, like, this is a little spooky for Wall Street

because when you are a company taking on this amount of debt to make huge bets on the future, in the past, maybe in 2024, in the early part of 2025, investors were rewarding these bets. We had this couple months stretch where Open AI would do a particular deal with Oracle or would do a particular deal with CoreWeave or Nvidia. And that particular stock would go up 10 to 20% on that day. Now, if you show any bit of shakiness, your stock is going to get crushed like Oracle's is doing right now. And also another AI adjacent company at really not adjacent. It's at the center of the AI trade is Corweave. Corweave spiked more than 400% after it IPOed. Now it's down more than 60% since then. So investors are getting a lot more skeptical.

They're getting a lot more strict about the finances of these companies that have not shown any return for all of their AI investment. There are still some bright size. I know this is the dog of the week segment, but Micron, which is a AI memory company, had an incredible earnings call this week where they said that, hey, we cannot actually keep up with demand. They came in ahead of every analyst forecast saying,

and analysts were surprised saying, like, this is actually real demand because this is not necessarily something where they have to bring on data centers online. They're actually just providing services to companies that do need AI. So there is real demand. out there. It just depends on where you're falling within, you know, the picks and shovels

a matrix here. Are you the ones actually having to build the data centers? Are you someone who's providing a service to companies that are actually generating revenue like someone like Micron is? Let's print to the finish with our final headlines. RIP to your screen time, TikTok is not going anywhere. TikTok finally signed a deal to spin off its U.S. operations into a new joint venture, according to a Membo from TikTok CEO, Show Chu. he sent to employees yesterday. This comes after a years-long saga that culminated in a law passed in 2024 that required TikTok to divest its U.S. operations or face a ban in the U.S.

The law technically went into effect back in January, but enforcement has been repeatedly delayed. Under the new joint venture, 50% of TikTok USA is owned by a consortium of mostly American investors, including Oracle and the P.E. firm Silver Lake, valuing the entity at around $14 billion. $19.9% is retained by BightDance, which keeps them below a key 20% legal threshold under U.S. law.

And 100% of you might be confused as to whether this was all necessary. The idea behind the joint venture is that now delicate things like American user data will be handled by an American company like Oracle. TikTok's algorithm will be retrained on U.S. user data and content moderation will also

be handled by the U.S. venture. Neil, we've got some all-american American scrolling ahead of us. I can't wait. This is bizarre because TikTok, according to this deal, is valued at $14 billion. In 2023, it did $16 billion in revenue. Right now, according to this deal, it's valued at about the same level as Snapchat. And it is one of the leading social media companies in the world and the United States. So analysts are trying to wrap their head around what's going on here. And the answer may be that this is just not really a business deal. It is a political deal. The Trump administration forced TikTok.

Bik Tickt's owner Bight Dance to make this deal happen and therefore had to sell it at a much lower value than it would, it should be valued at, which according to I put into Jad GBT, Tickt, TikTok should be, should be valued at around $100 billion. And this new entity, I think it's worth stressing this new American-owned entity, will not actually own the underlying algorithm that powers TikTok. And this may be so much of the value that is TikTok. It's still going to be owned by Beijing-based Bight Dance, but what's going to happen is that American auditors will be retraining the algorithm on U.S. user data.

So still more news to come. This happened late last night and we'll see what happens with TikTok under this new ownership, which Oracle stock is popping 5% yesterday. I know. That was the one thing we didn't mention. Now they own TikTok. We were saving it for, you know, the TikTok portion. We've spent a lot on AI data centers, but now they own TikTok.

All right. In a menu update that feels ripped out of an SNL commercial, Chipotle announced it will start selling meat in a cup beginning later this month. The four-ounce portion of adobe chicken or steak with nothing else in a cup is part of a wider high-protein menu that includes two high-protein bowls, a salad, a burrito, and an adobeau chicken taco. After a bruising year, Chipotle is hoping to reignite demand by leaning into a protein craze that every other food company is chasing. It says that high-protein diets have ranked as the top diet pattern in the U.S. for three years running, that 70% of Americans now say they prioritize protein and more than one-third have increased their protein intake over the past year. Toby, can meat in a cup save Chipotle? Yes.

Bull Slop is out. Cup Slop is so in at this point. In addition to the protein trend that they are jumping on, I think the smartest play here is the fact that they want to capture off-peak traffic. When does traffic peak at Chipoli? It peaks around lunchtime when everyone's getting their full burritos and full bowls. But maybe you want to pop in for a snack at 2 p.m., 3 p.m., 4 p.m. You can get meat in a cup and just have a little bit of snack,

but you don't want to order an entire burrito. So I think directionally they're saying, how can we get people in the door during non-peak hours? And also, they did call out the fact that GLP1 weight loss drugs are transforming how people are engaging with food. Portion sizes are getting smaller. A Chipoli burrito is massive. You don't want that if you are taking Ozepic or something similar.

So I think they're trying to kill three birds with one meat cup right now. And I'm kind of bullish on it. It might work. I think there was a branding misopportunity here, though, because they're calling it like high protein cups. And maybe if they just called it meat in a cup, it would actually go super viral, because that's what anybody is going to say anyway.

I do wonder about the social stigma or what it'll be like if you just go there and get me in a cup. You're not even using a fork. I'm not using a fork. I'm just tossing it straight back like this. It's going down the gullet. Meat down the gullet in a cup. Actually, I don't think you're right about the marketing aspect.

I do not think people want to actually meet the cup. That's why you're a podcaster, not a marketing expert. Finally, not every social media platform needs to do an end of year wrapped. And I'm looking at you, LinkedIn. The professional networking app released its first ever year in review that reminds you just how much time you spent looking for a job in 2025. Of course, that's not the intention, but that's basically how it functions. Located on the app, it tells you how many days you visited LinkedIn, how many new connections

you made, and how many impressions your profile racked up. LinkedIn editor-in-chief Dan Roth told CNN, we know this has been a challenging year for many job seekers, year in review is meant to reflect the full picture of how people showed up professionally this year, not just in searching for jobs, but learning new skills, building networks, sharing ideas, and supporting each other through change. Toby, a top 1% poster of cringe, party, man. Rap culture has gone too far. Someone had to say it, I'll be the one to say it.

I mean, I got so many wraps this year. I got a gin wrapped, which measures my golf handicap. I got a sleep wrap from my mattress. And now I have a LinkedIn wrapped. A lot of people on social media said, read the room, LinkedIn. Like, this has been a historically tough job market for a lot of people. And now here you are saying, hey, you were, you know, dramatically searching for a job in the wee hours of the morning, 360 out of the 365 days of the year.

A lot of people said, that is not what I want to know right now. I know that it was a tough job search for me. So it just is inherently at odds with what rap culture should be. It didn't make people feel good about themselves or about their job prospects. And neither did your gin. There's my dad. All right. And finally, we want to give a shout out to Serena for winning the latter game.

As a reminder, we gave you five things in a particular order based on one metric. This was on Monday. And we asked you to pick the metric we used to order them. Those things were Mario Garfield, SpongeBob, the Hulk, and Cookie Monster. As hundreds of you responded, the answer is colors of the rainbow, red, orange, yellow, etc. A lot of people answered the correct answer, but I do want to highlight one of our favorite incorrect answers, which was how much they love Italian food. And this was the justification given.

Mario is Italian, so he loves their food. Garfield loves lasagna. I can see Spongebob liking Italian more than the Hulk, and Cookie Monster just eats cookies. It kind of works. I feel like we should give out a consolation prize. That is all the time we have. Thanks so much for starting your morning with us and have a wonderful Friday. If you want to get in touch or ask a good question for that upcoming Q&A episode,

you can send a note to Morning Brew Daily at Morningbrew.com or DM us on Instagram at MB Daily Show. Let's roll the credits. Emily Milliron is our executive producer. Raymond Loo is our producer. Our associate producers are Olivia Graham and Olivia Lake. Hair and makeup is pretty checked out at work. Devin Emery is our president and our show is a production of Morning Brew. Great. So today, Neil. I wish you all well.