When New Century Financial’s shares were suspended from trading in New York in early March 2007, no one still doubted that the US subprime mortgage sector was in real trouble. Indeed, New Century, one of the largest subprime lenders, went bust a couple of weeks later.

However, the vast majority of informed observers, including this newspaper, saw little reason why the trouble should spread even to the rest of the US economy, let alone to any other financial markets beyond the US or the economies of those countries.