THE BREAKAGE MAP · SELECT THE SURPRISE
The Same Headline Can Break a Different Part of the Market
The first casualty depends on whether the shock enters through inflation, growth, funding or monetary credibility.
01 · SHOCK
Inflation reaccelerates
Markets price fewer cuts or another hike while valuations remain elevated.
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02 · TRANSMISSION
Yields and dollar rise
Discount rates climb across bonds, equities, property and leveraged balance sheets.
→
03 · BREAK
Duration gets repriced
Long bonds and expensive growth can fall together instead of offsetting one another.
1Long TreasuriesHighest direct sensitivity to rising long yields.
2Unprofitable growthDistant cash flows lose present value fastest.
3REITs and utilitiesBond-like equities face a higher financing hurdle.
The confirmation signal: stocks and bonds fall together as real yields rise.
That combination says the shock is inflationary, not a conventional growth scare. A single down day is noise; persistence across releases is the regime signal.
Mechanism framework based on BLS releases, Federal Reserve research on inflation regimes and standard asset-duration relationships. Not a forecast.