What if the transition erodes fossil-tax revenue faster than carbon pricing replaces it?
Governments dependent on fuel-tax and fossil-royalty revenue face a fiscal gap as the transition erodes the tax base faster than carbon-pricing receipts replace it.
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 3–10 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. 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. Governments dependent on fuel-tax and fossil-royalty revenue face a fiscal gap as the transition erodes the tax base faster than carbon-pricing receipts replace it. The trigger decomposes into signed root‑shocks — Climate/crop supply ▲ · Credit spreads ▲ · Oil demand ▼ · Real yields ▲ — 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 | Tech sector XLK 📈 chart | Equity | ▼ -0.5% hist -0.54–+0.44% · other way -0.59% (n=9) |
| 2 | MicroStrategy MSTRon Hyperliquid 📈 chart | Equity | ▼ -0.5% hist -0.5–+0.24% · other way +12.56% (n=9) |
| 3 | Wheat WHEATon Hyperliquid 📈 chart | Commodity | ▲ +0.5% hist -0.13–+0.91% · other way -2.47% (n=9) |
| 4 | Nasdaq 100 NDXon Hyperliquid 📈 chart | Index | ▼ -0.4% hist -0.38–+0.35% · other way +0.07% (n=10) |
| 5 | Corn CORNon Hyperliquid 📈 chart | Commodity | ▲ +0.4% hist -0.38–+1.85% · other way -4.63% (n=9) |
| 6 | 30y Treasury yield DGS30 📈 chart | Rate | ▲ +4bp hist -2.17–+3.44% · other way +24.2% (n=12) |
| 7 | Gold XAUon Hyperliquid 📈 chart | Commodity | ▼ -0.4% hist -0.48–+0.95% · other way -1.8% (n=9) |
| 8 | 10y Treasury yield DGS10 📈 chart | Rate | ▲ +4bp hist -2.2–+2.63% · other way +26.8% (n=12) |
| 9 | High-yield credit HYG 📈 chart | Rate | ▼ -0.3% hist -0.33–+0.18% · other way -0.45% (n=8) |
| 10 | Bitcoin BTCon Hyperliquid 📈 chart | Crypto | ▼ -0.3% hist -0.89–+1.38% · other way +4.09% (n=5) |
| 11 | S&P 500 SPXon Hyperliquid 📈 chart | Index | ▼ -0.2% hist -0.68–+0.18% · other way +0.37% (n=12) |
| 12 | Semiconductors SMHon Hyperliquid 📈 chart | Equity | ▼ -0.2% hist -0.34–+0.6% · other way +0.4% (n=9) |
| 13 | Financials XLF 📈 chart | Equity | ▼ -0.2% hist -1.37–+0.31% · other way +2.06% (n=9) |
| 14 | Arm ARMon Hyperliquid 📈 chart | Equity | ▼ -0.2% hist -4.32–+3.8% · other way -12.4% (n=4) |
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 | -2.0% · 5d -1.4% | 69% | 40 | 0.35 | ✓ matches cascade |
| XLF XLF | SHORT | -1.1% · 5d -1.0% | 63% | 39 | 0.24 | ✓ matches cascade |
| CORN CORN | LONG | +1.5% · 5d +0.0% | 62% | 39 | 0.23 | ✓ matches cascade |
| Gold XAU | LONG | +1.0% · 5d +0.2% | 61% | 39 | 0.21 | ⚠ differs |
| US dollar DXY | LONG | +0.7% · 5d +0.0% | 60% | 40 | 0.18 | · |
| 10y yield DGS10 | SHORT | -4bp · 5d +1bp ↺ fades | 60% | 40 | 0.15 | ⚠ differs |
| SMH SMH | LONG | +0.7% · 5d -0.6% ↺ fades | 58% | 39 | 0.14 | ⚠ differs |
| NDX NDX | LONG | +0.5% · 5d -0.9% ↺ fades | 56% | 40 | 0.10 | ⚠ differs |
| 30y yield DGS30 | SHORT | -4bp · 5d +2bp ↺ fades | 55% | 40 | 0.08 | ⚠ differs |
| XHB XHB | SHORT | -0.3% · 5d -0.7% | 55% | 39 | 0.08 | ✓ matches cascade |
| XLK XLK | LONG | +0.7% · 5d -0.6% ↺ fades | 54% | 39 | 0.06 | ⚠ differs |
| AMD AMD | SHORT | -0.1% · 5d -1.6% | 53% | 40 | 0.04 | ✓ matches cascade |
| MU MU | LONG | +2.3% · 5d -1.1% ↺ fades | 52% | 40 | 0.03 | ⚠ differs |
| MSTR MSTR | LONG | +0.5% · 5d -4.6% ↺ fades | 48% | 39 | 0.00 | ⚠ differs |