The high targeted returns give cause for concern as they may trigger a need to increase the risks taken by credit institutions. This can be done on the assets side, e.g. via more risky lending. Or on the liabilities side via higher leverage ratios. I hope that the high targets are not based on this type of strategic considerations.
What was unusual about the last cycle was the length of its upturn. After the economy had reached its potential production level, there followed three more years of relative strong growth before the cycle turned down. The prolonged rise is attributable to consumer spending. A strong autonomous increase of employment led to a favourable development of households’ incomes.