What if the Fed restarts quantitative easing?
QE restart to backstop disorderly markets: credit spreads tighten, front-end/real yields fall, and high-beta (Nasdaq, crypto) rallies on the liquidity backstop. The rhyme is Mar-2020 unlimited QE and the post-SVB BTFP — spreads snapped tighter and risk V-bottomed. Skeptic's note: QE restarts because something broke, so spreads gap wider before the backstop works — the playbook is to buy the policy-response bottom, not the pre-announcement panic; balance-sheet expansion is the floor, but only after the stress that forced it.
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 1–3 years 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-on shock. The Fed restarts balance-sheet expansion / QE to backstop disorderly markets. The trigger decomposes into signed root‑shocks — Fed policy path ▼ · Financial conditions ▼ — which propagate through our causal graph to the markets below.