RE: Article... The issue of leverage and firm survivorship has been studied from many angles.
Perhaps an analogy to a geologic manifestation interacting with human nature is relevant here in order to help spot the fulcrum security in a distressed leveraged structure. Why do people live on the slopes of dangerous volcanoes? Despite numerous eruptions that may be, to a certain degree, unpredictable, killing people and livestock, and covering crops with ash and lava flows, individuals and their families keep coming back. The main reason is the rich volcanic soil can develop into some of the richest agricultural lands on earth. People are willing to take a high-risk gamble in order to maximize the return of their soil production: food.
So, it may be OK, after an eruption, to go back close to the volcano (very close if you like to gamble) the same way that you may want to maximize your return with leverage. The fulcrum security concept here may have something to do with your capacity to run, but more likely, your survival odds are probably proportional to the distance of your land to the center of the volcano. Those who forego some potential yield on their crops may hold the geographic flexibility to save their lives when the volcano erupts.
So, referring to the FP article, I find that the TBE saga was not about a race for survival or “getting down to the wire”, it was about the fact that the eruption (downturn) occurred at night. With the lava coming and rushing down, it became simply too late to run for some. Leverage can burn.