What if a hard landing forces the Fed to slash rates back to zero within a year?
A hard landing forces the Fed to slash the policy rate to ~0.10% within a year, abandoning higher-for-longer as unemployment surges and deflation risk returns.
how we built this number — every step
The class rate is measured from our dated, sourced event library (decade-normalized Poisson — the full table is public at base_rates.json). The variant’s share within its class is the analyst’s editorial call, published so you can audit it. A wider range means thinner precedent. Full recipe: methodology · scored at Reality Check.
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 (gold) over time vs the crowd's (Polymarket, blue), from the past toward the 6–18 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. The gold path is an illustrative reconstruction anchored to today's estimate — real dated events, not a live re-estimate history.
What it would mean
If this plays out, it is a risk-off shock. A hard landing forces the Fed to slash the policy rate to ~0.10% within a year, abandoning higher-for-longer as unemployment surges and deflation risk returns. The trigger decomposes into signed root‑shocks — Fed policy path ▼ · Real yields ▼ · Recession signal ▲ · Risk appetite ▼ — which propagate through our causal graph to the markets below.
If it happens — the markets it would move
Biggest moves first. Projected moves are cascade-model priors; hist A–B% = what comparable past events actually did (measured abnormal returns), and model prior · unmeasured marks markets with no analogue backing yet. Tap any market for its price history.
| Market | Class | Projected move | |
|---|---|---|---|
| 1 | Gold XAUon Hyperliquid 📈 chart | Commodity | ▲ +1.1% hist -0.08–+1.66% · other way +2.39% (n=11) |
| 2 | 30y Treasury yield DGS30 📈 chart | Rate | ▼ -9bp hist -5.51–+0.12% · other way +25.2% (n=12) |
| 3 | Tech sector XLK 📈 chart | Equity | ▲ +0.8% hist -0.3–+2.06% · other way -0.31% (n=11) |
| 4 | 10y Treasury yield DGS10 📈 chart | Rate | ▼ -8bp hist -5.16–-0.6% · other way +30.6% (n=12) |
| 5 | Arm ARMon Hyperliquid 📈 chart | Equity | ▲ +0.5% hist -5.38–+1.36% · other way -4.68% (n=10) |
| 6 | MicroStrategy MSTRon Hyperliquid 📈 chart | Equity | ▲ +0.5% hist -1.28–+3.92% · other way +5.93% (n=11) |
| 7 | USD/JPY USDJPYon Hyperliquid 📈 chart | FX | ▼ -0.5% hist -0.77–+0.07% · other way +1.58% (n=11) |
| 8 | Homebuilders XHB 📈 chart | Equity | ▲ +0.5% hist -1.28–+0.63% · other way -2.82% (n=11) |
| 9 | Nasdaq 100 NDXon Hyperliquid 📈 chart | Index | ▲ +0.4% hist -0.35–+1.24% · other way -0.49% (n=11) |
| 10 | Robinhood HOODon Hyperliquid 📈 chart | Equity | ▲ +0.4% hist -0.38–+0.44% · other way +10.46% (n=11) |
| 11 | US dollar (DXY) DXYon Hyperliquid 📈 chart | FX | ▼ -0.4% hist -0.57–-0.01% · other way +0.92% (n=12) |
| 12 | 2y Treasury yield DGS2 | Rate | ▼ -4bp model prior · unmeasured |
| 13 | Financials XLF 📈 chart | Equity | ▼ -0.3% hist -0.57–+0.05% · other way +0.68% (n=11) |
| 14 | EUR/USD EURUSDon Hyperliquid 📈 chart | FX | ▲ +0.4% hist +0.02–+0.46% · other way -0.49% (n=11) |
Probable recommendation
Historical precedent — what analogous events actually did
Across 40 analogous events (overlap‑weighted), as abnormal returns — market beta stripped, so it's the event's own effect, not the market backdrop. Shown at 20 days (persistent) and 5 days (immediate); ↺ fades = the two horizons disagree. Confidence = consistency × sample × significance.
| Asset | History says | Abnormal (20d · 5d) | Hit | n | Confidence | vs cascade |
|---|---|---|---|---|---|---|
| ARM ARM | SHORT | -4.8% · 5d -5.6% | 70% | 23 | 0.28 | ⚠ differs |
| US dollar DXY | SHORT | -0.3% · 5d -0.1% | 64% | 40 | 0.25 | ✓ matches cascade |
| XLK XLK | LONG | +1.5% · 5d +0.0% | 61% | 40 | 0.20 | ✓ matches cascade |
| XHB XHB | SHORT | -1.4% · 5d -1.3% | 62% | 39 | 0.20 | ⚠ differs |
| EURUSD EURUSD | LONG | +0.2% · 5d +0.0% | 62% | 39 | 0.20 | ✓ matches cascade |
| Bitcoin BTC | SHORT | -3.8% · 5d -2.5% | 62% | 37 | 0.18 | ⚠ differs |
| TRY TRY | SHORT | -3.6% · 5d +0.2% ↺ fades | 60% | 39 | 0.18 | ⚠ differs |
| GBPUSD GBPUSD | LONG | +0.3% · 5d -0.1% ↺ fades | 60% | 39 | 0.16 | ✓ matches cascade |
| 30y yield DGS30 | LONG | +3bp · 5d +2bp | 59% | 40 | 0.15 | ⚠ differs |
| Gold XAU | LONG | +1.0% · 5d +0.0% | 59% | 40 | 0.14 | ✓ matches cascade |
| MSTR MSTR | LONG | +3.4% · 5d -2.1% ↺ fades | 57% | 40 | 0.13 | ✓ matches cascade |
| KRW KRW | LONG | +0.2% · 5d +0.2% | 57% | 39 | 0.13 | ✓ matches cascade |
| XLU XLU | SHORT | -1.2% · 5d -0.8% | 57% | 40 | 0.13 | ⚠ differs |
| 10y yield DGS10 | LONG | +2bp · 5d +1bp | 57% | 40 | 0.11 | ⚠ differs |