Thomas MuchaJanuary 11, 2013 11:00

The Fed is more profitable than Apple and Exxon. Combined.

How economic crisis can sometimes be good for the bottom line.

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Federal Reserve Chairman Ben Bernanke testifies before the Joint Economic Committee on Capitol Hill in Washington, DC, October 4, 2011. Bernanke on Tuesday said the United States may face yet more slow jobs growth, as he warned short-term budget cuts and financial turmoil could further threaten the economy. (JIM WATSON/AFP/Getty Images/Getty Images)

The key to good business writing is the frame.

In other words, how do you take arcane figures and put them into an easy-to-understand context that's smart, useful and memorable?

Our friends at Quartz nailed that task today, with a post titled "The US Fed had a greater profit than Apple and Exxon combined last year."

Catchy headline: check. Interesting topic: check.

The skinny?

The Federal Reserve turned a profit last year of $89 billion dollars, its best year in history.

As Quartz points out, the combined profits of Apple and Exxon — America's two most profitable companies — top a little more than $82 billion.

So how did the Fed do it?

Economic crisis, of course.

Deutsche Bank: the Fed's QE program isn't powerful enough to offset a 'fiscal hurricane'

Matthew Boesler, Business InsiderNovember 15, 2012 18:29

How well equipped is the Fed for staving off the looming fiscal cliff?

Thomas MuchaFebruary 29, 2012 15:28

Ron Paul v. Ben Bernanke

Paul: "The Fed's going to self-destruct."

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Republican presidential candidate Rep. Ron Paul at a town hall meeting at the Erickson Public Library in Boone, Iowa, on Dec. 8, 2011. (Kevork Djansezian/Getty Images)

High drama in Washington, D.C. today, especially if you're a fan of presidential politics, Fed policy, or both.

The venue: the semi-annual Monetary Policy Report to the Congress, given by US Federal Reserve Chairman Ben Bernanke.

In one corner, US congressman and Republican presidential candidate Ron Paul.

Best line: "The Fed is going to self-destruct when the money's gone."

In the other corner, Fed Chairman Bernanke.

Best line: "Good to see you again, Congressman Paul."

Yes, both were ready to rumble, in a classic wonkfest-death-match.

Of course, there's video.

Thomas MuchaJanuary 25, 2012 15:38

Fed keeps interest rates near zero until 2014

The Federal Reserve does its part to help the US economy. Again.

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The US Federal Reserve Building in Washington, DC, on Oct. 28, 2008. (Win McNamee/Getty Images)

The Federal Reserve is doing its best to do nothing.

That's the quiescent word out of Washington, D.C. today, as Ben Bernanke and team said they would leave US interest rates at "exceptionally low levels at least through late 2014.”

While noting some improvement in the overall labor market, the Fed gang pointed to a still-high unemployment rate, as well as the weak housing market and slowing business investment.

So it'll try to keep things going in the world's largest economy, by keeping rates low.

Here's the money quote, pulled from the latest Federal Open Market Committee notes:

To support a stronger economic recovery and to help ensure that inflation, over time, is at levels consistent with the dual mandate, the Committee expects to maintain a highly accommodative stance for monetary policy. In particular, the Committee decided today to keep the target range for the federal funds rate at 0 to 1/4 percent and currently anticipates that economic conditions--including low rates of resource utilization and a subdued outlook for inflation over the medium run--are likely to warrant exceptionally low levels for the federal funds rate at least through late 2014.

But, as usual, I prefer my economic arguments in easy-to-digest rap form.

Thomas MuchaDecember 29, 2011 11:05

Decoding Ben Bernanke and the Fed: What is money, anyway?

The answer is not as simple as you think.

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(Bay Ismoyo/AFP/Getty Images)

Hooray for Jon Hilsenrath, the Wall Street Journal's chief economics correspondent.

Hilsenrath has done the world a favor by writing this must-read story on the Journal's excellent Real Time Economics blog: "What is Money and How Do You Destroy It?"

It's 2,129 smart, well-researched and deeply-reported words that anyone who's interested in how the economy really works should read.

In it, Hilsenrath deconstructs the many Republican presidential candidate criticisms of Fed Chairman Ben Bernanke's policies, which Newt Gingrich calls "the most inflationary and dangerous in history."

But he also delves into deeper historical, philosophical and economic questions such as:

What is money? (It's a medium of exchange).

How much money is out there, and what's it worth? (It's complicated as the vast majority of money in the US economy isn't paper or coins, but rather "a bunch of zeroes and ones, electronic accounts in computer systems that tally who owes what to whom," Hilsenrath writes).

How to know whether all the new electronically generated money is destroying the dollar? (The dollar's value has been "on a roller coaster" since the 2008 Great Recession, and today it's worth just about the same as it was just before the collapse of Lehman Brothers).

How has inflation fared under Bernanke's Fed? ("Inflation might take off and wreck the purchasing power of a dollar. But official statistics suggest it hasn’t yet happened," he writes).

The piece ends on a cautionary note about the dollar's more recent value, and as the point bears remembering I'll quote Hilsenrath in full:

Thomas MuchaDecember 13, 2011 16:06

Federal Reserve leaves US rates unchanged

Will they? Won't they? They won't.

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Federal Reserve Chairman Ben Bernanke on Capitol Hill July 21, 2010, in Washington, DC on July 21, 2010. (Brendan Smialowski/Getty Images)

Forget Europe's pending euro meltdown, China's manufacturing slowdown and the general economic unease spreading across most of planet Earth.

It appears that the US economy is doing just fine.

That's the signal, anyway, from the US Federal Reserve, which today decided against cutting interest rates or doing much else to stimulate the US economy.

The nation's employment and inflation watchdog says it is leaving short-term interest rates at near zero.

Why?