Sunday surprise: Fed steps into credit crisis

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WASHINGTON (AP) -- The Federal Reserve, in an extraordinarily rare weekend move, took bold action Sunday evening to provide cash to financially squeezed Wall Street investment houses, a fresh effort to prevent a spreading credit crisis from sinking the U.S. economy.

The central bank approved a cut in its lending rate to financial institutions to 3.25% from 3.50%, effective immediately, and created another lending facility for big investment banks to secure short-term loans. The new lending facility will be available to big Wall Street firms on Monday.

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Treasury Secretary Henry Paulson said he was pleased by Sunday's developments.

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"We appreciate the actions taken by the Federal Reserve this evening," said White House press secretary Dana Perino. "Secretary Paulson and Chairman Bernanke are actively engaged in addressing issues affecting our financial markets. Secretary Paulson has kept the president briefed on recent developments."

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"It seems as if Bernanke & Co. are pulling out all the stops to avoid a serious financial market meltdown," Richard Yamarone, an economist at Argus Research, said Sunday evening.

http://money.cnn.com/2008/03/16/news/econo...sion=2008031619

[Trompe le Monde 1,107]

Asian markets are currently down -2% - make of that what you will

[mawilson 2,133]

I expect the Fed to eventually cut the interest rate down to 1% or even less.

Bad news for your "high-interest" savings account

[Jamie76 0]

I expect the Fed to eventually cut the interest rate down to 1% or even less.

Bad news for your "high-interest" savings account

Bad news for inflationary pressures. I was watching a program on yahoo finance where one individual was predicting 20% inflation in another 2 years.