The Volatility Machine

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Focusing on the dynamics of capital structures, the book argues that emerging market economies face unique vulnerabilities often overlooked by Wall Street. It distinguishes between "correlated" and "inverted" capital structures, highlighting their roles in influencing economic stability and volatility. The concept of a "capital structure trap" is introduced, illustrating how it can lead to a mechanical process of economic collapse. This analysis provides a fresh perspective on the challenges faced by emerging markets and the systemic risks they encounter.