Fed Takes Quickly Cuts to Key Interest Rate Over Weekend

News Type: Event — Seeded on Mon Mar 17, 2008 7:36 AM EDT

Article Source: Yahoo! Finance

business, financial, fed, finances, ben-bernanke, interest-rate, weekend, jpmorgan, bear-sterans, weekend-rate-cut

Takes Steps to Ease Crisis, Cuts Lending Rate to Financial Institutions to 3.25 Percent

Worry about the damage a growing credit crisis is inflicting on an ailing U.S. economy led the Federal Reserve to make a rare weekend move, lowering a key lending rate before Wall Street opened Monday.

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

"These steps will provide financial institutions with greater assurance of access to funds," Federal Reserve Chairman Ben Bernanke told reporters in a brief conference call Sunday evening.

The Fed acted just after JPMorgan Chase & Co. agreed to buy rival Bear Stearns Cos. for $236.2 million in a deal that represents a stunning collapse for one of the world's largest and most venerable investment banks. Just on Friday the Fed had raced to provide emergency financing to cash-strapped Bear Stearns through JPMorgan. Days earlier the Fed announced a set of other unconventional steps to thaw out a credit market in danger of freezing shut....

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{"commentId":1587650,"authorDomain":"newsguru"}

newsguru

Pretty soon they'll be back to the levels when the last boom happened. Here's a thought, they should have just left it alone. The Fed is not your friend.

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1 vote

#1 - Mon Mar 17, 2008 9:12 AM EDT

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Fed Takes Quickly Cuts to Key Interest Rate Over Weekend

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