Rational Financial Meltdowns

This article focuses on the following question: how can a group of rational, and often very sophisticated, financial actors cause financial meltdowns, in the regular course of business? There is no doubt much we still need to learn about irrational financial meltdowns, but more likely than not, cognitive shortcomings only make matters worse: they exacerbate the type of behavior that can lead even super-rational actors to cause financial meltdowns.