<P> Paul Krugman, laureate of the Nobel Prize in Economics, described the run on the shadow banking system as the "core of what happened" to cause the crisis . He referred to this lack of controls as "malign neglect" and argued that regulation should have been imposed on all banking - like activity . </P> <P> The securitization markets supported by the shadow banking system started to close down in the spring of 2007 and nearly shut - down in the fall of 2008 . More than a third of the private credit markets thus became unavailable as a source of funds . According to the Brookings Institution, the traditional banking system does not have the capital to close this gap as of June 2009: "It would take a number of years of strong profits to generate sufficient capital to support that additional lending volume ." The authors also indicate that some forms of securitization are "likely to vanish forever, having been an artifact of excessively loose credit conditions ." </P> <P> Rapid increases in a number of commodity prices followed the collapse in the housing bubble . The price of oil nearly tripled from $50 to $147 from early 2007 to 2008, before plunging as the financial crisis began to take hold in late 2008 . Experts debate the causes, with some attributing it to speculative flow of money from housing and other investments into commodities, some to monetary policy, and some to the increasing feeling of raw materials scarcity in a fast - growing world, leading to long positions taken on those markets, such as Chinese increasing presence in Africa . An increase in oil prices tends to divert a larger share of consumer spending into gasoline, which creates downward pressure on economic growth in oil importing countries, as wealth flows to oil - producing states . A pattern of spiking instability in the price of oil over the decade leading up to the price high of 2008 has been recently identified . The destabilizing effects of this price variance has been proposed as a contributory factor in the financial crisis . </P> <P> Copper prices increased at the same time as oil prices . Copper traded at about $2,500 per ton from 1990 until 1999, when it fell to about $1,600 . The price slump lasted until 2004, when a price surge pushed copper to $7,040 per ton in 2008 . </P>

The year 2008 revealed one of the risks of continued reliance on oil when
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