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Fed Cuts by 3/4 % Point, Suggests More Reductions Likely

edition.cnn.com — Do you think this is the right move and has the Fed accepted that recession is here? The U.S. Federal Reserve cut a key short-term interest rate by three-quarters of a percentage point Tuesday. The federal funds rate, an overnight bank lending rate that affects how much interest consumers pay on credit cards, home equity lines of credit and auto

Who dugg this? Made popular Mar 19, 2008

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  • Pssdoff, on 03/19/2008, -4/+96Time once again for the monthly rate cut... Its a good thing they can keep this up forever, otherwise the US would be heading for some sort of crisis.......
  • inactive, on 03/19/2008, -13/+76The dollar is crashing just like Ron Paul predicted. The fed is acting in such a way as to make all of the money you earn and save worth less.
    Time for a competing currency and time to honor Ron Paul for being right again.
  • gwinerreniwg, on 03/19/2008, -5/+52bye bye dollar. I was really hoping to get to europe this summer, but at this rate, the dollar will be worthless.
  • lucidguru, on 03/19/2008, -2/+41Insider trading, dropping the rate month after month... time to invest in foreign markets.
  • LordSkywalker, on 03/19/2008, -2/+31Guess I'll finally be able to wipe my ass with money soon. Not because I'm rich though, it'll just be cheaper than buying TP.
  • Jade456, on 03/19/2008, -1/+26Its a band aid on a gaping wound. What happens when they can't lower it any more?
  • z28com, on 03/19/2008, -2/+26I saw the DOW was up 420. My jaw was on the floor That's sweet as a cesspool. Why don't they pass a law that as soon as the feds cut the rates, the banks have to IMMEDIATELY cut the rates to the people? What good is cutting the rates to the banks when it's us consumers are not feeling it. I won't notice any difference if the rates go up or down. I have a fixed 6.5% on my 30 year. The rates can climb to 12% for all I give a *****.

    Curse all of the people who did not vote for Ron Paul. It's THEIR FAULT that the main guy who was going to fix all of this is not going to be president. I told everybody I knew about this man and had stickers all over my cars. Obama, Hillary or anyone else now will not fix this problem. Ron Paul was our last chance. We will not have another 4 to 8 more years of hell just like we had with Bush.
  • FluffyWolf, on 03/19/2008, -0/+22Inflation is more than 4% and the Federal Reserve is lending at 2.25%...insane, the Federal Reserve lends at negative real interest rate, the more you borrow, the more you earn. (And by "you" I don't mean you, as no bank will lend you or anyone else any money below the inflation rate, as that would be insane. There are better ways to invest money than to lend them at a loss.)
  • macjaeh, on 03/19/2008, -1/+23I DONT KNOW WHAT THIS MEANS, BUT WHY DONT WE JUST PRINT MORE MONEY FOR POOR PEOPLE!?!?!?
  • inactive, on 03/19/2008, -1/+19Debt-based private central banking makes baby Jebus cry.
  • ScienceDoc, on 03/19/2008, -1/+19What happens when our money is free and no one wants it? Seriously, who wants dollars? I think the neocons have launched us into the abyss.
  • Hangly, on 03/19/2008, -0/+14It's a good start. What are his positions on foreign policy?
  • swicken, on 03/19/2008, -1/+15Eventually it'll go less then 0 and start giving you extra money for borrowing it off of them. Who cares, you can just print more anyway right?!
  • WhistlinTom, on 03/19/2008, -6/+20Ron Paul
  • lead2thehead, on 03/19/2008, -0/+13Someone should inform the Fed that low interest rates is why we are in this mess to begin with.
  • inactive, on 03/19/2008, -2/+15Get ready for the Amero.
  • inactive, on 03/19/2008, -2/+151) Fed cuts rates, the long end of the yield curve rises, interest rates (To the consumer, you can't borrow directly from the Fed) rise.
    2) The cost of money increases because of lack of trust, inability to lend, or deflation of monetary supply through the reduction of the slosh or programs such as the TAF, and the Libor rates increase which causes interest rates to rise. Watch the bond market, it is the indicator we need to pay attention to.

    We are under attack, while the CEOs of the investment banks, and home lending companies are vacationing or receiving huge pay offs. We will be responsible for the cost of the Bear Stearns "acquisition", through increased taxation. I guarantee there is a bill being presented as I type. Buckle down, we are only getting started.
  • iShotWeb, on 03/19/2008, -4/+16Ron Paul is still a presidential candidate.
  • PhantomRogue, on 03/19/2008, -4/+16Monthly? *****, we are at weekly cuts. The ***** morons at the Fed think that even more inflated money is going to solve things. It doesn't take a genius to understand that continually printing money with no backing or recourse to it, only makes things worse. Start tightening the ***** budget, it will even itself out, dropping Rates like this only increases the severity of the eventual collapse.
  • inactive, on 03/19/2008, -1/+12Once they're finished exhausting all the interest rates they can muster, they will intervene credit card interest rates... That 30% APR $500 monthly minimum interest only payment probably isn't helping America's ability to pay those inflated mortgages
  • wysiwygd, on 03/19/2008, -1/+12Thanks, I'm always interested in economic news articles! :)
  • iShotWeb, on 03/19/2008, -1/+12Anyone who understands 'the business cycle' could predict this. Ron Paul is the only presidential candidate that understands that the business cycle is caused by credit expansion due to the manipulation of interest rates by a central bank.
  • regeya, on 03/19/2008, -0/+11Things have been "good" long enough that people forgot the old addage that if things seem too good to be true, they probably are.
    Seriously, when things started looking up in the region I live in DESPITE industries leaving, it made me antsy. A lot of people seem to think that the dollar being low is a sign the NAU and Amero is right around the corner, but I think it more likely that McCain is wrong and that we'll see a bit of a resurgence in industry, at least for a while. I'm hoping for the sake of the town my wife works in, it will, because they just had a Maytag plant shut down. Maybe, oh just maybe, it'll be cost-effective to build the damn things in America again...
  • iShotWeb, on 03/19/2008, -1/+11the nominal rates of interest are positive, but due to high inflation, real rates are negative.
  • inactive, on 03/19/2008, -2/+11The gold bugs were, are, and will continue to be right. As the price of oil rises and the dollar goes down, gold prices over the intermediate term will on average rise. This is why it's prudent to have a little portion of savings in precious metals (gold, silver). And rhodium is over $9000 an ounce now. Paper money is only as good as the government that issues it. And when the government prints it like it was, well, paper, you end up with inflation, then hyperinflation, and then a depression. Current administration spends like a drunken sailor. You know where that's going.
  • inactive, on 03/19/2008, -4/+13BOHICA!
  • FluffyWolf, on 03/19/2008, -0/+9Japan had deflation at the time they had 0% interest at their national bank, which means they had still a positive real interest rate. The Federal Reserve is currently lending at a negative real interest rate and they already did that prior to the recent interest cut, so they are currently lending at a far more extreme interest rate than Japan ever did.
  • Hangly, on 03/19/2008, -0/+8Aren't we at zero yet? Or is zero technically impossible?
  • Khast, on 03/19/2008, -0/+8drop the rate, and magically the economy will go back to normal....hmm for some reason I don't think everyone got the memo. If dropping the rate is going to increase lending, that means in lean times, more bankruptcy, foreclosures, and other lending problems which are plaguing our nation.

    To improve the economy I think the banks need to STOP giving out credit like they do the candy in the trays. The credit cards, and stupid lending practices are what is dragging our country into the ground.

    Yeah, businesses might suffer a bit, but you want to do your part in reviving the economy....IF YOU CAN'T AFFORD IT, YOU DON'T NEED IT. And if you do really need credit, pay it off as quickly as possible, you will save a lot of money by paying it off quickly.
  • mrinsanity, on 03/19/2008, -0/+8I can't wait for the new Lowermybills.com ads! "FED CUTS RATES AGAIN" Cue the dancing aliens!
  • iShotWeb, on 03/19/2008, -0/+8All banks are bankrupt. There's 10 times as much money in the economy as there is cash to back it up. If a large enough group of people tries to take assets out of any bank it will go insolvent.
  • inactive, on 03/19/2008, -0/+8And it made adult Jesus kick over some tables and throw the money changers on their ass. Something no one in this modern time is willing to do. Hell, you can't even get a national leader to acknowledge they exist.
  • michaelb1, on 03/19/2008, -0/+7All I know is since Jan 1st 2008 I lost all my 2007 stock gains. SUCKS.
  • iShotWeb, on 03/19/2008, -1/+8The market always rallies for a day or two when the Fed drops interest rates. The market will be down soon enough again.
  • ryansriches, on 03/19/2008, -4/+11the economy is so damn sluggish right now. hopefully the new president will do something about all of this inflation. we are in sooo much turmoil as a country.
  • bc289, on 03/19/2008, -0/+7They call it a liquidity trap when they can't keep lowering the interest rate. The next best option then is fiscal spending usually.
  • mOdQuArK, on 03/19/2008, -0/+7REAL inflation is probably at a helluva lot more than 4%. Good luck trying to get hard #s on it though - the government seems bound & determined to make it hard to figure out what the real rate of inflation is.
  • samcol, on 03/19/2008, -0/+7ron paul predicted it because it was inevitable. so long as the fed keeps printing the dollar will go down.
  • inactive, on 03/19/2008, -0/+7his pastor is a racist, and obama has denounced those sermons. how does that make obama a racist?
  • LordSkywalker, on 03/19/2008, -5/+12http://ronpaul2008.com

    You stand (or sit, probably) corrected.
  • CicurateGroup, on 03/19/2008, -1/+7Band-aids baby, band-aids. It is time to get out the heavy gauze pads, because a week from now the market is going to bleed!!!!!!!!
  • betterth, on 03/19/2008, -0/+6So naive... unless by 'this' summer, you meant the summer of '2010'.
  • NEUTRINO50, on 03/19/2008, -0/+6japan, the 90s, good times
  • Cyrus042, on 03/19/2008, -0/+6Capitalism can't operate without a government regulating it in some sense. Enforcement of contracts, and such are all forms of regulation. Dishonest lending, speculative lending and such are what got us into this mess. Government regulation in the form of helping create transparency in the second hand lending market and also making sure that those being given loans know what they're getting into.

    Dishonesty in capitalism can be dangerous, which is why we have regulations.
  • dives425, on 03/19/2008, -0/+6Dont worry - The government is sending tax relief checks in the mail soon, everything will be just fine....
  • piratearggghhh, on 03/19/2008, -0/+6Except we don't manufacture much these days. What will help just a tiny bit is tourism money but that's just a drop in the bucket.
  • rodgerdodger5, on 03/19/2008, -1/+7http://video.google.com/videoplay?docid=-905047436 ...
  • 55mph, on 03/19/2008, -0/+6Sagags, this time is different. much different! We are backed into an economic Depression with rising commodity prices globally. This time is very different. Where's our manufacturing base? What do we produce now besides financial derivatives? $ 14 bil a month for Iraq. Interest rates so low that the currency risk tied to the yield makes our Government debt undesirable. We must sell $20 bil of new Government bonds every week to pay the interest on our debt.. get the picture.
  • inactive, on 03/19/2008, -0/+6 In Germany back in 1923 people burned currency in their fireplace because it made more flame the the firewood you could purchase with it. But that can't happen here, America is a special place and history and does not apply.
  • Akronos, on 03/19/2008, -0/+6Exports are just one part of the GDP, and a small part of that too. We're a consuming nation, not a nation of exporters.
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