What if Japanese real yields turn meaningfully positive for the first time in decades?
As inflation expectations rise and the BoJ lifts policy, Japanese real yields turn meaningfully positive for the first time in decades, repricing every yen asset valued off a zero-real-rate world and pressuring bond and equity books.
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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. As inflation expectations rise and the BoJ lifts policy, Japanese real yields turn meaningfully positive for the first time in decades, repricing every yen asset valued off a zero-real-rate world and pressuring bond and equity books. The trigger decomposes into signed root‑shocks — Credit spreads ▲ · Financial conditions ▲ · Real yields ▲ · Risk appetite ▼ — which propagate through our causal graph to the markets below.