# Economic Impact Framework

Use this reference after `economic-impact-report` is selected. Keep the main skill compact; load this for full causal mapping, timing, and public-equity transmission discipline. Cross-asset facts are inputs here, not the final product.

## Causal Spine

A strong report moves:

1. Event -> what is new.
2. What is new -> transmission channel.
3. Transmission channel -> first variable likely to reprice.
4. First repricing -> direct beneficiaries and losers.
5. Direct effects -> second-, third-, and fourth-order consequences.
6. Consequences -> scenarios, catalysts, issuer/sector implications, and portfolio actionability.

If you cannot name the channel, you do not yet understand the impact well enough.

## Timing Buckets

- Immediate: 0 to 5 trading days.
- Near term: 1 to 12 weeks.
- Medium term: 1 to 4 quarters.
- Structural: 1 year+.

## Confidence Labels

- High: strong evidence, clear mechanism, limited dependency chain.
- Medium: good mechanism, some unresolved assumptions or pricing uncertainty.
- Low: plausible but evidence-light or highly path-dependent.

## Directness Labels

- Direct: immediate mechanical effect on the event participants or primary exposed assets.
- Second-order: suppliers, customers, competitors, substitutes, financing channels, insurers, distributors, or policy response.
- Third-order: labor, inventories, credit quality, capex, cross-border flows, second-round inflation/growth effects, or market structure knock-ons.
- Fourth-order: regime effects, industrial policy, reserve/capital-flow shifts, strategic behavior changes, or long-duration capital allocation consequences.

## Transmission Channels

Choose the 2 to 5 channels that actually drive the thesis. Common channels:

- demand
- supply, capacity, logistics, throughput
- pricing power
- regulation, litigation, policy precedent
- financing conditions, refinancing, collateral, credit availability
- labor, wages, staffing
- commodities, energy, freight, raw materials
- geopolitics, sanctions, tariffs, trade restrictions
- inventories, backlog, working capital
- fiscal response, subsidies, taxation, sovereign issuance
- central bank response and rate path as they affect equity duration, funding costs, margins, capital return, or multiples
- cross-border flows, reserve dynamics, external balance, and FX translation as they affect listed issuers
- positioning, systematic flows, hedging, crowding
- balance-sheet optionality, capital allocation, buybacks, dividends, M&A, and equity downside

## Quantification Rules

Prefer approximate magnitude over vague direction. Quantify when relevant:

- revenue exposure
- cost pass-through and margin sensitivity
- EPS, FCF, ROIC, capital return, and multiple sensitivity
- import reliance and export mix
- refinancing needs and funding cost sensitivity
- inventory, backlog, utilization
- working-capital effects
- rate, FX, commodity sensitivity
- curve shape, basis, carry, spread, and commodity implications when they feed issuer economics
- implied move, implied volatility, skew, term structure
- scenario probabilities and time-to-truth

Use explicit labels: `Known`, `Inferred`, `Assumed`, `Disconfirmers`, and `Action / monitoring`.

## Domain Checks

Cover only domains that are material, but check each one internally:

- Listed issuers: direction, directness, mechanism, first line item affected, timing, confidence, what is priced, and action implication.
- Sectors and peer groups: structural versus sentiment-driven effect, subsegment impact, cyclical/secular/regulatory/event-driven nature, and likely estimate-revision dispersion.
- Portfolio and positioning: owned/watchlist/benchmark exposure, active weight, liquidity, crowding, short interest, ETF/index flow, and hedge relevance.
- Macro/FX/rates/commodities/options/futures: include only when they transmit into revenue, costs, margins, funding, discount rate, valuation, volatility, or equity positioning.
- Credit signals: use only as common-equity downside or solvency read-through; route credit instruments, spreads/yields relative value, covenants, recovery, and debt-security selection to Credit Markets.