This interactive chart illustrates a core mechanism from the model developed in "Follow the Money: Do Private Markets Tip All at Once?" — a bistable dynamical-systems model applied to private equity markets.
The key idea: the threshold beyond which ordinary redemption pressure turns into a self-reinforcing liquidity run is not fixed. As certain market conditions — leverage, valuation opacity, capital trapped in existing funds — deteriorate, this threshold quietly erodes. The result: a shock the market once absorbed without difficulty can, at the very same magnitude, become enough to trigger a crisis.
Try moving the slider to see how a lower threshold shrinks the critical point beyond which the system loses stability.
Working paper available upon request