What if a US 30-year Treasury auction fails?
A 30y auction with collapsing bid-to-cover and heavy dealer takedown spikes long yields ~40bp and shakes global duration; the clean trade is bear-steepening with gold bid and equities pressured by a higher cost of capital. Rhymes with the soft auctions and 2023 long-end tantrum, plus the 2022 gilt-LDI spiral as the cautionary tail. Foreign reserve managers and dealers are the marginal bidders; a buyer's strike lifts term premium globally. Forward angle: supply-driven, fiscally-rooted — fade rallies in long duration until the term-premium repricing is digested.
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. A US 30-year Treasury auction sees a record bid-to-cover collapse and dealer takedown, spiking long yields 40bps and shaking global duration. The trigger decomposes into signed root‑shocks — Dollar/reserve confidence ▼ · Fed policy path ▲ · Financial conditions ▲ — which propagate through our causal graph to the markets below.