Fed Cuts Interest Rates By Quarter Point

The Fed cut interest rates again today as they continue in their attempt to swoop in and save the economy from the credit crunch. Much like Superman, but boring and not as effective.

From the Federal Open Market Committee Statement:

Incoming information suggests that economic growth is slowing, reflecting the intensification of the housing correction and some softening in business and consumer spending. Moreover, strains in financial markets have increased in recent weeks. Today’s action, combined with the policy actions taken earlier, should help promote moderate growth over time.

They also left themselves some room to cut rates further:

Recent developments, including the deterioration in financial market conditions, have increased the uncertainty surrounding the outlook for economic growth and inflation. The Committee will continue to assess the effects of financial and other developments on economic prospects and will act as needed to foster price stability and sustainable economic growth.

Federal Open Market Committee Statement [FED]
(Photo:MykReeve)

Comments

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  1. darkened says:

    treason, i declare treason

  2. Munsoned says:

    Yay! My (variable) student loan rates will be heading south!

  3. Munsoned says:

    Um… Did anyone else notice the 200 point drop in the Dow the minute this was announced? Looks like its down over 260 points at the moment…

  4. JPinCLE says:

    I’ve held out this long to refi… how looooow will they go? Patience is running thin!

    I think 4.0 maybe in the next 3 months after a weak holiday shopping season wraps up, then steady for a while.

  5. Adam Hyland says:

    @JPinCLE: LOL

    there is a pretty obvious lower bound. :) I’m pretty sure something will happen before the Fed takes up the same policies as the bank of japan.

  6. shan6 says:

    Time to refi my vehicle.

  7. sleze69 says:

    @JPinCLE: Last week, my credit union’s no points 30 year refinance was down to 5.5% so I waited to see how low it would go. Today it is back up to 5.75% :(

  8. warf0x0r says:

    @ErnieMcCracken: Figure in the lost value of the dollar against foreign currency and its worse!

  9. johnva says:

    @ErnieMcCracken: The market was hoping/expecting a deeper cut in interest rates.

  10. Munsoned says:

    @johnva: Yes, I know… Those greedy bastards…

  11. Anitra says:

    Bleh. All my loans are fixed rate. I’m more interested in inflation and my savings account. Raise interest rates, dammit!

  12. Me - now with more humidity says:

    Remember that this is just the funds rate.

  13. Rusted says:

    I’m happy the market is up a little bit. Still, not a good thing to turn the dollar into toilet paper.

  14. tange1 says:

    I’m happy to see a drop in rates as I haven’t locked in the mortgage on my first home.

  15. catnapped says:

    YIPEE–not like we were paying enough for food or energy before!

  16. AD8BC says:

    So they lower the rate and the ingrates still dump the stock market…

  17. Grrrrrrr, now with two buns made of bacon. says:

    @catnapped: Shhhhhh….just don’t call it “inflation.”

    Oh, but the good news is…if you exclude energy and food, there was very little inflation!

  18. darkened says:

    Actually isn’t lowering these rates RAISING the costs of mortgages? Since the banks will make less in short term notes that they will need to charge higher rates else where to make it up?

  19. catnapped says:

    @dwayne_dibbly: Well of course–not as if anyone actually eats food or uses energy!

    We can just melt all those DVD players down and heat our houses with those!