The semi-annual testimony before the US Congress last week by the chair of the Federal Reserve Janet Yellen implicitly raised the question of what constituted normal economic conditions before ducking the issue entirely. The desired tempo of future interest rate rises will depend on whether history is taken as a guide to the future or whether structural changes are seen to have altered the likely range of US growth and inflation outcomes. Once we get past the anxiety of the first rise in interest rates for the cycle, answers to these dilemmas will have to be found before sensible decision making can follow. (VIEW LINK)