The 24-hour news cycle has done it again.

This week began with a sharp selloff on Tuesday, the stock market’s worst single day since October.

Pundits were quick to lay the blame on Trump’s tariff threats over Greenland. Then it was the mysterious and ever-looming yen carry trade.

Or maybe it was some tangled combination of the two?

These explanations were convenient enough, but they don’t hold up to scrutiny.

The financial news media are much better at filling airtime than understanding markets. When prices drop sharply, they need to find a scapegoat.

Most of the time, the real reason is much simpler than whatever the media has landed on.

So today, I want to debunk the Greenland and yen carry trade narratives that have been floating around.

And I’ll fill you in on the real reason why stocks sold off so sharply on Tuesday. 

It Was Never About Greenland or the Yen

Let’s start with Greenland. Trump has been talking tough, but I don’t believe there was ever a realistic prospect of an invasion.

He confirmed as much at the Davos meeting yesterday, stating that there would be no military action, while reiterating his goal to acquire Greenland.

Reports later surfaced that Trump and NATO Secretary General Mark Rutte had formed the framework of a future Greenland deal without tariffs.

You can call it “TACO” if you want. I think of it more as “Art of the Deal.” Either way, this is nothing new from Trump.

Public pressure on one side, quiet progress on the other. Say one thing loudly, do something else more strategically.

It’s overly simplistic to say that Tuesday’s selloff was solely because of Trump using this same playbook over Greenland negotiations.

The yen carry trade was offered up as another explanation for Tuesday’s selloff.

Sure, it sounds like a more sophisticated answer. But if that truly was the culprit, then why didn’t it play a role in yesterday’s rebound?

Either a structural unwind is happening or it isn’t. You can’t blame the yen in the morning only to ignore it in the afternoon when it’s no longer convenient.

So if it wasn’t Greenland, and it wasn’t the yen, what actually happened?

The Only Explanation That Makes Sense

The answer is simply that markets got overheated.

Nearly every major asset class has been on a tear since the year began, and prices ran ahead of themselves.

It’s a normal part of market cycles. But it does create conditions where a pullback becomes inevitable.

That’s what happened on Tuesday. Investors took profits and the market exhaled.

Importantly, the broader trend remains intact. Oil prices are down, economic data is strong, and upcoming corporate earnings are expected to be solid.

Of course, that doesn’t make for interesting conversations on CNBC. So the talking heads stuck with a more clickworthy angle.

The irony is that what actually happened is constructive. The market reset, excess optimism cooled, and weak hands got shaken out.

This is what bull markets do. They move higher, pause, correct, and then continue — often in ways that frustrate anyone looking for a more exciting explanation.

Moments like this are precisely when discipline matters most.

Chaotic headlines are designed to provoke emotional reactions rather than thoughtful decisions.

Investors who jump in and out based on the latest news story will always underperform those who stick to a plan.

So tune out the distractions. Focus on fundamentals. Understand that not every selloff needs a villain.

We’ll continue to call out lazy narratives and keep you grounded in what’s actually happening.