The global financial system, despite centuries of evolution and reform, continues to suffer from structural defects that limit economic potential and maintain inequality. This chapter examines both obvious and subtle flaws in the traditional financial structure, from widespread crisis contagion to sophisticated forms of financial distortion and control. Through real-world analysis and historical case studies, we demonstrate how these defects create poor resource allocation, limit economic mobility, and generate repeated crises that disproportionately affect developing economies.