What if the 2s10s yield curve dis-inverts sharply?
A sharp 2s10s dis-inversion is the classic late-cycle tell — it bull-steepens via a falling front end as cuts get priced, lifting gold and easing mortgage rates. Rhymes with mid-2024 when the curve un-inverted ahead of the Fed's first cut; gold ground higher on lower real rates. Skeptic's note: dis-inversion historically leads the recession by quarters, not weeks, so this is a positioning/duration signal, not an immediate risk-off trigger.
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The butterfly cascade
How this trigger trickles across markets, left → right — the root shock, its first‑order moves, then the ripple effects. Drag any node; tap a market for its real price history.
Resolution timeline — how this probability is moving
Our model's odds (electric blue) over time vs the market's (Polymarket, amber), from the past toward the 0–6 months horizon. Each dot is a real macro event that nudged the probability — green pushed it up, red pushed it down. Tap a dot for the source. Loading the probability audit trail…
What it would mean
If this plays out, it is a mixed shock. The US 2s10s curve dis-inverts sharply — the classic late-cycle recession lead. The trigger decomposes into signed root‑shocks — Recession signal ▲ · Fed policy path ▼ — which propagate through our causal graph to the markets below.