As the 55th anniversary of the bank holiday of March 1933 approached, financial instability was a main topic in the financial press. Daily reports appeared of international debt crises, of the covert bankruptcy of deposit insurance, and of the near bankruptcy of one great financial institution after another. The great stock market crash of October 19 and 20, 1987, demonstrated that extreme instability can happen. It is generally asserted that the consequences of October 19th and 20th would have been disastrous if the Federal Reserve and Treasury interventions had not set things right. In 1933, financial markets in the United States and throughout the capitalist world collapsed. In the light of historical experience, the past 55 years are the anomaly. The papers collected in this volume come from various backgrounds and research paradigms. A common theme runs through these papers that makes the collection both interesting and important: The authors take seriously the obvious evidence that capitalist economies progress through time by lurching. Whether a particular study starts from household utility maximization or from the processes by which productive structures are reproduced and expanded, the authors are united in accepting the evidence that financial instability is a significant characteristic of modern capitalism.

I Basic Models on Nonlinear Dynamics and Financial Instability: A Minsky Crisis, Finance, Instability, and Cycles, Debt-Financing of Firms, Stability, and Cycles in a Dynamical Macroeconomic Growth Model, Accumulation, Finance, and Effective Demand in Marx, Keynes, and Kalecki, The Real and Financial Determinants of Stability: The Law of the Tendency Toward Increasing Instability, II Stabilization Policy in Nonlinear Dynamical Models with Money and Finance: Comparative Monetary and Fiscal Policy Dynamics, Monetary Stabilization Policy in a Keynes-Goodwin, Model of the Growth Cycle, Qualitative Effects of Monetary Policy in "Rich" Dynamic Systems, Debt Commitments and Aggregate Demand: A Critique of the Neoclassical Synthesis and Policy, III Empirical Evidence on Debt and Financial Instability: The Cyclical Behavior of Corporate Financial Ratios and Minsky's Financial Instability Hypothesis, Theories of Financial Crises, The Political Economy of the External Debt and Growth: The Case of Peru