What if a divided Congress spirals into a prolonged government shutdown?
A prolonged US shutdown is a slow growth-drag, not a crash: each week shaves ~0.1-0.2pp off quarterly GDP and dents confidence, but markets historically look through it. Rhymes with the 2018-19 35-day shutdown (S&P actually rallied once the Dec selloff ended). The novel risk is a shutdown colliding with a debt-ceiling X-date, which would hit T-bills and money funds far harder than equities.
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. Prolonged US shutdown over debt and spending freezes agencies, furloughs millions, dents GDP and consumer confidence. The trigger decomposes into signed root‑shocks — Growth surprise ▼ · Risk appetite ▼ — which propagate through our causal graph to the markets below.