Polymarket is pricing bank failure risk at absurd levels right now. You can lock in ~9% annualized just betting Wells Fargo doesn't collapse by year-end.
That's completely disconnected from reality. CDS spreads, preferreds, sub debt—none of it remotely agrees with those odds.
Either the prediction market is wildly mispriced, or every other corner of fixed income has lost its mind. My money's on the former.
This is what happens when retail speculation meets actual credit markets. The gap is so wide you could drive a truck through it.
That's completely disconnected from reality. CDS spreads, preferreds, sub debt—none of it remotely agrees with those odds.
Either the prediction market is wildly mispriced, or every other corner of fixed income has lost its mind. My money's on the former.
This is what happens when retail speculation meets actual credit markets. The gap is so wide you could drive a truck through it.
