Possible scenario
Deficits Fund Security
20% Chance
Governments prioritize defense, energy security, and industrial policy even as the IMF urges restraint. This keeps fiscal deficits elevated, but the market impact is concentrated in defense and capital-goods exposures rather than broad panic.
Initial impacts
- 10-year Treasury yield Up
- Market volatility Up
- Riskier companies' borrowing costs Up
Secondary impacts
- Industrials +0.6%
- Consumer Cyclicals -0.2%
- Non-Energy Materials +0.2%
Portfolio impact
S&P 500-0.1%
Each figure is the modeled move of the S&P 500 if the outcome occurs. For information only. Not investment advice.
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