Commodity bubble of Financial Crisis of 2007–2009

This article is about the series of financial market events, starting in July 2007, which were the proximate cause of a weakening of the global economy. For details on the stock market crashes and bank bailouts of late 2008, see Global financial crisis of 2008–2009. For economic issues beyond the financial markets, see Late 2000s recession. For discussions of major aspects of the policy response to the crisis, see The Keynesian Resurgence of 2008 / 2009 and 2009 G-20 London summit.

The narrowing of the yield curve from 2004 and the inversion of the yield curve during 2007 indicated a bursting of the housing bubble and a wild gyration of commodities prices as moneys flowed out of assets like housing or stocks. A commodity bubble was created following the collapse in the housing bubble. The price of oil rose to over $140 dollars per barrel in 2008 before plunging as the financial crisis began to take hold in late 2008. A similar bubble in oil prices has preceded other historical economic contractions.