What if a $30bn pension shortfall topples a legacy industrial?
A single pension-deficit failure dumps liabilities on PBGC but is idiosyncratic; the clean trade is the issuer's own HY bonds and CDS, not the broad market. This rhymes more with Bethlehem Steel / Delphi pension terminations than with Lehman — those crushed the names' bonds to cents but left HY indices intact. Skeptical note: one corporate, even at $30B, rarely re-rates IG credit; fading the reflexive VIX/BTC selloff is the better expression.
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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. A legacy industrial with a $30B pension shortfall collapses, dumping liabilities on the PBGC and crushing its bonds. The trigger decomposes into signed root‑shocks — Credit spreads ▲ · Recession signal ▲ — which propagate through our causal graph to the markets below.