In an article from the upcoming issue of the Financial Analysts Journal, Mohamed A. El-Erian and Michael Spence use an array of real-life examples — including the current sovereign debt crisis in the eurozone — to analyze the underlying dynamics of the periodic bouts of systemic path dependence that affect not only financial markets but also investment strategy itself. Their analysis explains how sudden shifts in expectations can morph into particularly disruptive multiple-equilibrium dynamics and points to possible implications for market outcomes, market equilibriums, and policy responses.