What if luxury spending collapses in China and the US?
A 30% drop in US/China luxury spend guts the high-end discretionary complex — the cleanest trade is short European luxury (LVMH, Kering, Richemont, Hermes) and Swiss watch exporters, since China is ~25-35% of global luxury demand. Rhymes with the 2015-16 China anti-corruption/slowdown shock that cratered watch exports and Swatch/Richemont. Transmission: China demand funds European luxury margins; a Chinese consumer retrenchment hits Paris-listed names and the CHF watch supply chain harder than US discretionary. The copper/AUD China-growth cascade is a reasonable second-order read.
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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 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 risk-off shock. Chinese and US luxury spending falls 30%, gutting the high-end discretionary complex from handbags to watches to spirits. The trigger decomposes into signed root‑shocks — China growth ▼ · Recession signal ▲ — which propagate through our causal graph to the markets below.