What if Fed misreads soft NFP as immigration collapses breakeven payrolls?
An immigration shutdown drops the breakeven payroll pace so far that even healthy hiring prints look weak; the Fed misreads soft NFP as demand softness, holds dovish, and lets wage-driven services inflation run hotter.
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 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. Loading the probability audit trail…
What it would mean
If this plays out, it is a mixed shock. An immigration shutdown drops the breakeven payroll pace so far that even healthy hiring prints look weak; the Fed misreads soft NFP as demand softness, holds dovish, and lets wage-driven services inflation run hotter. The trigger decomposes into signed root‑shocks — Fed policy path ▼ · Inflation expectations ▲ · Inflation surprise ▲ · Labor shortage ▲ · Risk appetite ▼ — which propagate through our causal graph to the markets below.