What if California's FAIR Plan breaks under wildfire losses?
A California FAIR Plan failure forcing a statewide policyholder assessment is an insurance-capital and housing-finance shock — it raises carrying costs and impairs wildfire-zone collateral — with essentially no link to grain markets; the modeled wheat/corn +0.7% via crop-stress is a category error from over-broad climate_supply mapping. Rhymes with the post-2017/2018 wildfire insurer retreat (and PG&E's bankruptcy). Correct the roots to credit/financial-conditions and a small property-insurance climate component, dropping the food-crop channel entirely.
Every number ships with its receipt — the odds, the range, the precedents, and a public grade at Reality Check. The statistical machinery that produces it is proprietary.
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 1–3 years 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 risk-off shock. Wildfire losses overwhelm California's insurer of last resort, forcing an assessment on all policyholders statewide. The trigger decomposes into signed root‑shocks — Credit spreads ▲ · Financial conditions ▲ · Risk appetite ▼ — which propagate through our causal graph to the markets below.