When volatility increases, the negative effect on the already low intrinsic value is less than the positive effect on time value. As volatility increases, consequently, equity value increases.

this book I will argue that certain types of financial crises—like the crises that have affected many Latin American and Asian countries in recent years—are problems of sovereign balance sheet mismanagement and not economic mismanagement.

Volatility itself was an extremely important variable, and to ignore it invalidated much of the analysis.

The Eurodollar market was the name given to the market surrounding the dollar accumulation in the banking system outside the United States during the “dollar glut” period of low U.S. interest rates in the 1960s.

a market collapse is nearly always implicit in the structure of the market itself.

I will distinguish between economic policy and the transmission of volatility, and I will argue that policy-making must be constructed in an environment in which excess volatility is kept to a minimum.

One problem with most LDC securities markets is that there is a very poor balance of investors.

The second, less obvious, way is to reduce directly the mismatch between revenues and expenses by lining up debt servicing costs with operating revenues.

Rather it is to address directly the instability that is introduced through the mismatched capital structure.