What if combined bond and credit losses force public capital injections into multiple Japanese regional banks?
Combined securities and credit losses force public capital injections into multiple regional banks under the deposit-insurance framework, the first systemic use of the regime since the 1990s and a signal of sector fragility.
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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. Combined securities and credit losses force public capital injections into multiple regional banks under the deposit-insurance framework, the first systemic use of the regime since the 1990s and a signal of sector fragility. The trigger decomposes into signed root‑shocks — Credit spreads ▲ · Financial conditions ▲ · Recession signal ▲ · Risk appetite ▼ — which propagate through our causal graph to the markets below.