During those years:   Fiscal deficits consistently topped 5 per cent of GDP, peaking at 15.6 per cent at the end of the period.   The government debt to GDP ratio rose from about 100 per cent at the beginning of the period to 130 per cent at the end of the period.
From financial turmoil to financial panic In mid-2007, suddenly though not unexpectedly, the interactions of perverse incentives, excessive complexity and global imbalances threw the credit boom into reverse. The asset cycle turned, and many of the missing links in the financial chain were exposed. Investors suddenly lost confidence. After years of high profits and exceptional risk tolerance, markets became extremely discriminating about financial risk.