The America credit cycle is at a dangerous point

The credit cycle in America is at a dangerous point. This was first put to light by
the article of a French economist. According to which the real rate of return to
capital exceeds the real rate of economic growth. In simple terms, the people
of America had become cautious to maintain their debt cycle because of the
rapid increase in tax rates by the government. The wages and earnings of the
workers did not grow in the proportion of the increasing inflation and tax
rates.

Conclusion – The credit cycle of America reached a dangerous point because of

multiple factors working simultaneously like the increase of tax rates and
inflation. Thus the credit cycle was disrupted due to non ability to return the
dues. The great recession in 2008 was also a major factor in leading the credit
cycle of America to a dangerous point because the citizens lost their source of
revenue and could not pay their dues on time and thus were not able to raise
more and more credit after a period of time.