What if China curbs rare-earth exports to EU carmakers?
Rare-earth/battery-material curbs on EU carmakers hit German autos and their suppliers first: short VW/BMW/Mercedes and European auto-parts, long the rare-earth ex-China supply chain (MP Materials, Lynas). The template is China's 2010 rare-earth embargo on Japan and the April 2025 Ga/Ge and rare-earth controls. China is the EU's chokepoint supplier; Germany is the exposed importer. The cascade is mis-built — it routes an EU-auto shock through TSMC/Nvidia/ASML semis, which are tangential; autos and rare-earth miners are the real beta.
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 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 risk-off shock. Beijing restricts rare-earth and battery-material exports to EU carmakers, escalating beyond brandy and dairy and crippling German auto output. The trigger decomposes into signed root‑shocks — Trade tension ▲ · China growth ▼ · Industrial demand ▼ · Growth surprise ▼ — which propagate through our causal graph to the markets below.