What if IT and AI profitability reverse sharply, dragging Japan's tech sector down?
A sharp reversal in IT and AI-related corporate profitability — the BoJ FSR's IT-profitability stress factor — drags TOPIX tech, dents bank equity holdings and impairs the private-credit and venture-debt extended to the AI buildout.
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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 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-off shock. A sharp reversal in IT and AI-related corporate profitability — the BoJ FSR's IT-profitability stress factor — drags TOPIX tech, dents bank equity holdings and impairs the private-credit and venture-debt extended to the AI buildout. The trigger decomposes into signed root‑shocks — AI capex ▼ · Recession signal ▲ · Risk appetite ▼ · Semiconductor supply risk ▲ — which propagate through our causal graph to the markets below.