What if a confidence shock hits Deutsche Bank?
A German-lender capital scare is a genuine systemic node: long CDS/short equity on the name, widen senior-financials and Bund-swap spreads, and expect periphery banks to gap on contagion. The exact rhyme is the March 2016 and Sept-Oct 2016 Deutsche Bank CDS blowouts, plus the March 2023 CS/UBS resolution. Cross-border, DB's counterparty web means US and Asian financials co-move. The roots (credit/financial-conditions heavy, risk-appetite -0.8) are well-sized; only the 'risk-on compresses vol' cascade label is internally contradictory.
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. Renewed doubts over a German lender's capital spark a European bank-CDS blowout and deposit flight fears. The trigger decomposes into signed root‑shocks — Credit spreads ▲ · Financial conditions ▲ · Risk appetite ▼ — which propagate through our causal graph to the markets below.