What if the ECB deploys its crisis tool to defend France?
ECB activating TPI for France while splitting the Council is two-sided: it caps OAT spreads (supportive) but the public rift signals the tail is real — fade the clean -2.7% Nasdaq and focus on OAT-Bund and Bund-curve repricing. Rhymes with the July 2022 TPI launch, which calmed periphery spreads even as hawk-dove tension lingered. Transmission: peripheral sovereigns benefit from the implied backstop; the credibility cost shows in Bunds. Forward angle: deploying TPI for a core like France (vs. Italy) is unprecedented and politically explosive, so the real risk is German legal/political pushback, not US equity beta.
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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-off shock. Bond-buying tool activated to cap French spreads, splitting the Governing Council publicly. The trigger decomposes into signed root‑shocks — Credit spreads ▲ · Geopolitical risk ▲ · Risk appetite ▼ — which propagate through our causal graph to the markets below.