This is a description of a rule of thumb that describes Fed behavior. I don't know why.
> >
>>there are
>> theoretical reasons to think that the "equilibrium real interest
>> rate" should increase with increases in the rate of profit.
>
>What are they?
>
That if the interest rate is permanently below the rate of return on capital, investment will boom until the marginal product of capital drops, growth slows, and the rate of return on capital falls...