---
session_id: 2026-09-16-block-031-close
date: 2026-09-16
block: 031
block_name: Credit HY/IG spreads
phase: Phase 1 (Credit)
status: ● closed Working+
session_closed_clean: true
session_close_date: 2026-09-16
---

# 2026-09-16 — Block 031 main material + CLOSE (Working+)

Two-session block. Session 1 (2026-09-09): pre-read teach (formal substitution — user opted out of reading), probe pass, Target 1, 17 cards. Session 2 (this): Targets 2–4, live-data walk, 16 cards, close.

## Key events
- **User corrected MY RV direction error** (callable RV trade): I said "sell A rich in option terms"; user identified holder is short the call → long callable vs short bullet is the short-vol monetization. Logged as user-catch; card pushed on corrected direction.
- Probe outcomes: Target 2 clean pass (no correction loop — Block 011 mirror transferred). Target 3: one component slip (cash−CDS basis vs "option component") + one framing correction (cross-over compression = forced-flow, not default-risk). Target 4: one read correction ("dispersed" → BBB−IG 18bp anomaly + uniform-calm signature).
- Probe 6 (OAS 3-component decomposition) verified in applied form via live FRED walk (IG 80bp/24th, HY 271bp/11th, BBB 98bp/14th, BBB−IG 18bp on 2026-09-14 prints).
- 16/16 cards pushed + synced; block total 33 notes in `Macro Study::Phase 1 — Components::Credit`.
- Anki relaunched headless (config fix held, port 6565).

## Anchor insight
"The spread level is a diagnostic; the trade comes from the component. A flat cross-section skew at cycle tights is not calm — it's the market underpricing the step function."

## State (post-close)
- **Block 031: closed Working+ (2026-09-16)**
- **Block 032 (CDS basis mechanics): next — pre-reads to be assigned at next session open** (deviation note: this close did not name them in the block file per protocol; assign first thing at 032 open).
- Pre-read teach substitution FORMAL for Block 031: Block 032 open gate = recall check on Hull/BAML/BIS substrate (33 cards + 1–2 spot probes) before its own pre-read verification.

## Carry-forwards
to_block_032:
  cold_recall_queue: 2019-style CDS-flat diagnostic (component misidentification carded; re-probe at open)
  substrate_locked: CDS three isolation roles, negative-basis RV sketch, recovery-by-convention
process_notes:
  - Applied-form decomposition verification (live data, name-the-check-not-the-print) worked well — reuse
  - User comfortable with portfolio-construction extensions (wealth CIO framing) — keep integrating practitioner questions into targets