This is the last, but certainly not the least, in a series of contributions on currency crises and contagion by Paul Masson. Making order – at least, some order – in what is currently the most chaotic and Byzantine niche of international macroeconomic literature is a burdensome but priceless task. In this and other recent essays, Masson contributes coherently and intelligently to an overdue process of intellectual housecleaning within the field, presenting reasonable taxonomies and shedding light on the implications of a vast array of models and theories for policy analysis. Specifically, this chapter provides a neat, extensive overview of “multiple-equilibria” models of speculative attacks and currency crises. It is an easy guess that this survey will frequently appear on the reading lists of courses in international capital markets, and I am confident it will have a long shelf life among researchers and policy analysts.

Masson is an earnest advocate of the relevance of multiple equilibria as a modeling device to understand complex issues such as the determinants and implications of the international currency and financial crises of the 1990s. But proselytizing need not mean being blind or unfair. While the strengths of the multiple-equilibria approach are emphasized, as we expect, its weaknesses are not hidden or dismissed. Rather, they are generally treated as open issues left to future investigations and analyses.

In my comments, I will try to emulate the standards of impartiality and objectivity of the analysis, although with a twist. In my view, what needs to be emphasized are not the strengths of the multiple-equilibria approach, but rather its weaknesses.