What if the US deports millions of undocumented workers?
Mass deportations are a labor-supply shock, so the cleanest channel is higher breakevens lifting real yields and the long end, with labor-intensive homebuilders squeezed and consumer spending crimped — gold falls as real rates rise. Rhymes with the post-2021 reopening labor shortage that drove unit-labor-cost and shelter inflation and forced the Fed to stay tight. Forward angle: this is a stagflationary supply shock (higher inflation AND lower output), so the Fed reaction is ambiguous — the curve, not just the front end, carries the signal.
how we built this number — every step
The class rate is measured from our dated, sourced event library (decade-normalized Poisson — the full table is public at base_rates.json). The variant’s share within its class is the analyst’s editorial call, published so you can audit it. A wider range means thinner precedent. Full recipe: methodology · scored at Reality Check.
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 (gold) over time vs the crowd's (Polymarket, blue), from the past toward the 0–6 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. The gold path is an illustrative reconstruction anchored to today's estimate — real dated events, not a live re-estimate history.
What it would mean
If this plays out, it is a risk-off shock. The US enacts mass deportations of millions of undocumented workers. The trigger decomposes into signed root‑shocks — Labor shortage ▲ · Inflation expectations ▲ — which propagate through our causal graph to the markets below.
If it happens — the markets it would move
Biggest moves first. Projected moves are cascade-model priors; hist A–B% = what comparable past events actually did (measured abnormal returns), and model prior · unmeasured marks markets with no analogue backing yet. Tap any market for its price history.
| Market | Class | Projected move | |
|---|---|---|---|
| 1 | Homebuilders XHB 📈 chart | Equity | ▼ -0.4% hist -0.96–+2.23% · other way +2.31% (n=8) |
| 2 | 30y Treasury yield DGS30 📈 chart | Rate | ▲ +4bp hist +0.28–+4.91% · other way +5.5% (n=10) |
| 3 | Nasdaq 100 NDXon Hyperliquid 📈 chart | Index | ▼ -0.4% hist -0.83–+0.16% · other way -1.45% (n=10) |
| 4 | Gold XAUon Hyperliquid 📈 chart | Commodity | ▼ -0.4% hist -0.86–+0.19% · other way +2.43% (n=9) |
| 5 | 10y Treasury yield DGS10 📈 chart | Rate | ▲ +4bp hist -0.52–+6.25% · other way +4.5% (n=10) |
| 6 | Tech sector XLK 📈 chart | Equity | ▼ -0.3% hist -0.46–+0.01% · other way -1.17% (n=10) |
| 7 | S&P 500 SPXon Hyperliquid 📈 chart | Index | ▼ -0.2% hist -0.87–+0.28% · other way +1.79% (n=10) |
| 8 | US dollar (DXY) DXYon Hyperliquid 📈 chart | FX | ▲ +0.2% hist -0.07–+0.43% · other way +0.79% (n=10) |
| 9 | 2y Treasury yield DGS2 | Rate | ▲ +2bp model prior · unmeasured |
| 10 | EUR/USD EURUSDon Hyperliquid 📈 chart | FX | ▼ -0.2% hist -0.4–+0.08% · other way -1.16% (n=8) |
Probable recommendation
Why we may diverge from history
Trust the cascade SHORT on XHB: history's +3% comes from 2023-24 CPI/rate-cut homebuilder rallies, a disinflation regime opposite to a deportation labor-supply shock that lifts construction wages; structural conditions differ.
Historical precedent — what analogous events actually did
Across 40 analogous events (overlap‑weighted), as abnormal returns — market beta stripped, so it's the event's own effect, not the market backdrop. Shown at 20 days (persistent) and 5 days (immediate); ↺ fades = the two horizons disagree. Confidence = consistency × sample × significance.
| Asset | History says | Abnormal (20d · 5d) | Hit | n | Confidence | vs cascade |
|---|---|---|---|---|---|---|
| XHB XHB | LONG | +2.2% · 5d -0.5% ↺ fades | 60% | 35 | 0.18 | ⚠ differs |
| 10y yield DGS10 | LONG | +4bp · 5d +3bp | 57% | 40 | 0.12 | ✓ matches cascade |
| US dollar DXY | LONG | +0.3% · 5d -0.1% ↺ fades | 55% | 40 | 0.09 | ✓ matches cascade |
| XLK XLK | SHORT | -0.3% · 5d -0.7% | 56% | 36 | 0.08 | ✓ matches cascade |
| Volatility VIX | SHORT | -0.7% · 5d +1.2% ↺ fades | 55% | 40 | 0.08 | · |
| Bitcoin BTC | LONG | +1.0% · 5d -4.8% ↺ fades | 53% | 30 | 0.05 | · |
| NDX NDX | SHORT | -0.6% · 5d -1.0% | 53% | 40 | 0.03 | ✓ matches cascade |
| EURUSD EURUSD | SHORT | -0.3% · 5d +0.1% ↺ fades | 51% | 35 | 0.02 | ✓ matches cascade |
| 30y yield DGS30 | LONG | +2bp · 5d +2bp | 50% | 40 | 0.00 | ✓ matches cascade |
| Gold XAU | SHORT | -0.6% · 5d -0.5% | 50% | 36 | 0.00 | ✓ matches cascade |
| SPX SPX | SHORT | -0.7% · 5d -0.3% | 50% | 40 | 0.00 | ✓ matches cascade |
| High-yield credit HYG | LONG | +0.1% · 5d +0.0% | 49% | 35 | 0.00 | · |
Why this probability
Mass-deportation push active under Trump 2026, but 'millions' in 6 months operationally hard. A base‑rate‑anchored prior, continuously scored against what actually happens — not a forecast.