With hindsight, it can now be seen that some of the factors driving growth in the past also sowed the seeds for the crisis. So why did the global growth model prove to be unsustainable? One striking feature of the high global growth rates was the reliance on large and unsustainable global imbalances.
In principle, current account imbalances can be desirable, if they channel funds across the world to their most productive use. But in the years prior to the crisis imbalances were a symptom of economic distortions: in some countries asset price bubbles developed and household debt levels rose beyond sustainable levels.