Rising leverage and excessive credit growth increased the vulnerability of the financial system. 1  I am very grateful to Kevin Koerner and Stephan Sauer for their valuable input. BIS Review 8/2009  1  This fragility set the stage for the turbulence in financial markets which started in summer 2007.
Source: Congressional Budget Office, The Budget and Economic Outlook (retrieved from Federal Reserve Bank of St. Louis, FRED). Figure 3.