The US economic story hasn't changed in a year - and that's great news

The US economy continues to grow at a modest, steady rate.

And this is great news.

Over the last year and a half, the economic story in the US has been the same: a disappointing start to the year followed by a rebound that overall indicates the economy is growing a bit more than 2% per year.

This week, we saw extreme volatility in the US stock market.

And while these wild price swings made headlines, the most important news of the week came Thursday morning, when we learned that the US economy grew 3.7% in the second quarter, better than economists had expected.

Compared to the prior year, the US economy grew 2.7% in the second quarter of 2015, right about what it's been for the last year or so.

Over the last year, two things about the US economy have been true: the labor market is rapidly improving and GDP growth is solid but not great.

Going into the August jobs report last year, the unemployment rate stood at 6.2%; now it stands at 5.3%. But a year before that - so, July 2013 - the unemployment rate was at 7.3%.

And so for two years we've seen massive year-on-year improvements in the broadest measure of the labor market's health. Meanwhile, total nonfarm payrolls have grown by over 5 million during this two-year period.

Solid and stable.

Despite these indications of a solid and stable US economy, something that has come up more than once in 2015 is the prospect of a US recession.

Earlier this year we noted that some on Wall Street had begun to ask whether the US was tipping into recession after a disappointing first reading on economic growth to start this year. And just last week, Goldman Sachs said that many of its clients were asking about the prospect of a downturn in the US economy in 2016. (Goldman said this was not in its forecast.)

And while the US economic expansion is now going into its sixth year, it's worth remembering that the most recent recession was the worst in several generations, and that by some measures we haven't even gotten back to "square one."

This week, financial markets were rocked by a variety of worries, one of which was the health of the US and world economy, particularly due to concerns about the health of China.

And while some economists emphatically argued that China's economic slowdown will not impact the US, economic data are backward looking and financial markets are forward looking: the stock market can - and often does - respond to fears which can be - and often are - ultimately unfounded.

Over the last two days, all eyes have been on the Kansas City Fed's annual economic symposium in Jackson Hole, Wyoming, and the speech made by Fed vice chair Stanley Fischer stole the show.

Fischer's speech was about inflation dynamics and addressed the issue of why inflation has remained persistently low over the last several years. To Fischer, inflation would be higher were it not for the collapse in oil prices and the US dollar's spike in value.

And so in short, Fischer has seen enough - the US economy is where it needs to be and is probably ready for interest rates to rise.

Of course, the question is whether rates first go up in September or December, and Fischer made clear that neither he nor anyone else at the Fed know the answer to that question.

But he also made that that isn't really the question that needs answering.

What matters most for the economy - both in the US and around the world - is how quickly the Fed will raise rates, and on this count Fischer and other Fed officials have been very clear that they plan to raise rates slowly, meaning not necessarily at each Fed meeting following lift-off.

But of course the only reason we're even having a discussion about rate hikes is because amid all the noise, the US economy's signal is still the same: things are good and slowly getting better.

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