What if US inflation collapses toward outright deflation?
A CPI collapse toward deflation cements aggressive easing; the dominant chain is real yields down, lifting long-duration tech and gold while the front end rallies. Closest real analogue is the 2014-15 disinflation that drove the ECB/SNB into negative rates and crushed bond yields — Bunds and Treasuries rallied hard, gold firmed on lower real rates. Forward risk: outright deflation also signals demand destruction, so risk-on in equities can stall even as duration wins.
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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 risk-on shock. US CPI collapses toward outright deflation, cementing aggressive easing. The trigger decomposes into signed root‑shocks — Inflation surprise ▼ — which propagate through our causal graph to the markets below.