Fed Rate Cut

The Fed Rate Cut came this morning, lowering it by .5% down to 1.5% and also lowered it’s discount rate by the same to 1.75%. They say the the move was necessary because of the global financial crisis. At the time of this post US stock futures is turning around.

The Federal Reserve coordinated a global cut in interest rates in cooperation with the European Central Bank, the Bank of England, and a host of other central banks across the globe, finally giving the market the bottle of milk it’s clamored for the last two days.

Despite some of the most aggressive actions by central banks that anybody has witnessed since the Great Depression. The Fed here has done everything it can to attempt to re-flate the stalled credit markets, getting to the point where it agreed to buy unsecured debt, while giving corporations access to its borrowing windows.

The Fed rate cuts are just the latest in a series of groundbreaking moves by the world’s top central banks to try to breathe life into embattled financial markets.

Earlier in the week, the Fed took steps that could potentially make trillions of dollars available to banks and the nation’s leading businesses. That’s on top of the controversial $700 billion Wall Street bailout approved by Congress Friday. Earlier Wednesday, the Bank of England announced a bailout plan of that nation’s banks, as it said at least $350 billion will be made available to British banks.

Today’s fed rate cut was the eighth since September 2007 and the second outside of a regularly-scheduled meeting. But the Fed had left rates unchanged at its last three meetings ahead of this emergency cut. The Fed’s next monetary policy meeting is a two-day session that concludes on Oct. 29.