What if a demand shock pushes leveraged airlines back toward default?
A demand shock or fuel spike pushes leveraged airlines back toward the brink, reprising the pandemic-era airline credit stress now without government backstops.
how we built this number — every step
The class rate is measured from our dated, sourced event library (decade-normalized Poisson — the full table is public at base_rates.json). The variant’s share within its class is the analyst’s editorial call, published so you can audit it. A wider range means thinner precedent. Full recipe: methodology · scored at Reality Check.
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 (gold) over time vs the crowd's (Polymarket, blue), from the past toward the 6–18 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. The gold path is an illustrative reconstruction anchored to today's estimate — real dated events, not a live re-estimate history.
What it would mean
If this plays out, it is a risk-off shock. A demand shock or fuel spike pushes leveraged airlines back toward the brink, reprising the pandemic-era airline credit stress now without government backstops. The trigger decomposes into signed root‑shocks — Credit spreads ▲ · Jet fuel ▲ · Recession signal ▲ · Risk appetite ▼ — which propagate through our causal graph to the markets below.
If it happens — the markets it would move
Biggest moves first. Projected moves are cascade-model priors; hist A–B% = what comparable past events actually did (measured abnormal returns), and model prior · unmeasured marks markets with no analogue backing yet. Tap any market for its price history.
| Market | Class | Projected move | |
|---|---|---|---|
| 1 | MicroStrategy MSTRon Hyperliquid 📈 chart | Equity | ▼ -1.4% hist -2.84–+0.32% · other way +20.8% (n=12) |
| 2 | Solana SOLon Hyperliquid 📈 chart | Crypto | ▼ -1.1% hist -1.29–+0.54% · other way +0.49% (n=10) |
| 3 | High-yield credit HYG 📈 chart | Rate | ▼ -0.9% hist -0.73–+0.02% · other way -0.36% (n=12) |
| 4 | Hyperliquid (HYPE) HYPEon Hyperliquid | Crypto | ▼ -0.9% model prior · unmeasured |
| 5 | Nasdaq 100 NDXon Hyperliquid 📈 chart | Index | ▼ -0.9% hist -0.43–+0.3% · other way +0.14% (n=12) |
| 6 | Volatility (VIX) VIXon Hyperliquid 📈 chart | Vol | ▲ +0.8% hist -1.93–+5.5% · other way -11.64% (n=12) |
| 7 | Ether ETHon Hyperliquid 📈 chart | Crypto | ▼ -0.8% hist -0.58–-0.29% · other way +2.69% (n=10) |
| 8 | Financials XLF 📈 chart | Equity | ▼ -0.8% hist -1.33–+0.09% · other way +0.44% (n=12) |
| 9 | Bitcoin BTCon Hyperliquid 📈 chart | Crypto | ▼ -0.8% hist -0.88–+0.6% · other way +6.03% (n=10) |
| 10 | S&P 500 SPXon Hyperliquid 📈 chart | Index | ▼ -0.6% hist -0.94–+0.05% · other way -0.53% (n=12) |
| 11 | Tech sector XLK 📈 chart | Equity | ▼ -0.6% hist -0.58–+0.31% · other way +0.08% (n=12) |
| 12 | JPMorgan JPM 📈 chart | Equity | ▼ -0.5% hist -3.23–+0.54% · other way +1.36% (n=12) |
| 13 | Coinbase COINon Hyperliquid 📈 chart | Equity | ▼ -0.5% hist -2.36–+2.96% · other way +21.85% (n=10) |
| 14 | Semiconductors SMHon Hyperliquid 📈 chart | Equity | ▼ -0.4% hist -0.43–+0.52% · other way +0.43% (n=12) |
Probable recommendation
Historical precedent — what analogous events actually did
Across 40 analogous events (overlap‑weighted), as abnormal returns — market beta stripped, so it's the event's own effect, not the market backdrop. Shown at 20 days (persistent) and 5 days (immediate); ↺ fades = the two horizons disagree. Confidence = consistency × sample × significance.
| Asset | History says | Abnormal (20d · 5d) | Hit | n | Confidence | vs cascade |
|---|---|---|---|---|---|---|
| JPM JPM | SHORT | -2.6% · 5d -1.4% | 69% | 37 | 0.32 | ✓ matches cascade |
| NDX NDX | LONG | +0.6% · 5d -1.0% ↺ fades | 66% | 36 | 0.25 | ⚠ differs |
| DAL DAL | LONG | +2.0% · 5d +0.5% | 61% | 36 | 0.18 | ⚠ differs |
| TSM TSM | SHORT | -0.5% · 5d -1.4% | 61% | 36 | 0.17 | ✓ matches cascade |
| XLF XLF | SHORT | -0.8% · 5d -0.6% | 59% | 36 | 0.16 | ✓ matches cascade |
| MSTR MSTR | SHORT | -1.9% · 5d -3.3% | 59% | 36 | 0.14 | ✓ matches cascade |
| MU MU | LONG | +3.1% · 5d -1.4% ↺ fades | 58% | 36 | 0.14 | ⚠ differs |
| COIN COIN | LONG | +3.4% · 5d +1.6% | 57% | 14 | 0.12 | ⚠ differs |
| SMH SMH | LONG | +0.7% · 5d -0.5% ↺ fades | 55% | 36 | 0.09 | ⚠ differs |
| AMD AMD | SHORT | -0.2% · 5d -0.9% | 56% | 37 | 0.09 | ✓ matches cascade |
| 10y yield DGS10 | SHORT | -1bp · 5d -1bp | 55% | 40 | 0.09 | · |
| Volatility VIX | LONG | +4.8% · 5d +4.7% | 54% | 36 | 0.07 | ✓ matches cascade |
| NVDA NVDA | LONG | +0.7% · 5d -2.6% ↺ fades | 54% | 36 | 0.06 | ⚠ differs |
| US dollar DXY | LONG | +0.4% · 5d +0.1% | 53% | 40 | 0.06 | · |