Tracked Scenarios
Macro scenarios under active surveillance. Each scenario is tracked with a Bayesian probability model, updated via evidence from 150+ economic indicators.
How our probability model works →BOJ Policy Normalization
The Bank of Japan raises its policy rate above 0.5% or materially accelerates its YCC exit, triggering a significant yen carry trade unwind. Yen strengthening causes forced deleveraging across global risk assets as carry-funded positions are unwound, repricing global term premia and compressing risk appetite in high-beta markets.
Credit Crisis / Stress Event
A significant credit event — HY spreads widening above 600bps, a CDS index spike, or a major corporate/sovereign default — triggers a liquidity withdrawal cycle and contagion across credit markets. This represents a non-linear stress regime where normal correlation structures break down and flight-to-safety flows dominate.
Energy Supply Shock
A major disruption (>2M bbl/d equivalent) to global energy supply through geopolitical conflict, sanctions enforcement, or infrastructure failure, driving Brent above $100 and triggering secondary inflation effects in importing economies.
Trade War Escalation
Major new tariff announcements (>$50B in affected trade) between the US and China/EU, triggering retaliatory measures, supply chain disruption, and input cost inflation across manufacturing and technology sectors.
US Fiscal Dominance
Monetary policy becomes subordinated to fiscal needs as the US debt/GDP ratio forces the Fed to implicitly cap real rates, even at the cost of higher inflation. Long-end yields detach from Fed guidance as term premium reprices.
Hard Landing / Recession
The US enters a full recession with 2 consecutive quarters of negative real GDP growth, accompanied by rapid unemployment rise above 5% and disinflation as demand collapses. Distinct from stagflation: inflation falls rather than persists, creating a classic deflationary bust with widening credit spreads and flight to safety.
Stagflation Re-emergence
Simultaneous inflation persistence above 4% and rising unemployment above 5% with real GDP growth below 2%, creating a policy dilemma where the Fed cannot cut rates to support growth without reigniting inflation.
All scenario probabilities are computed using a Bayesian log-odds model with time-decay, cross-metric correlation adjustment, and simultaneous coherence enforcement.
Read our full methodology →Scenario updates by email
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