Federal Reserve cuts discount rate 1/4
The Federal Reserve took another step to calm markets ahead of its meeting Tuesday, when it is expected to cut its Federal funds target rate. The Fed, "on Sunday announced two initiatives designed to bolster market liquidity and promote orderly market functioning". A release says, "First, the Federal Reserve Board voted unanimously to authorize the Federal Reserve Bank of New York to create a lending facility to improve the ability of primary dealers to provide financing to participants in securitization markets.... Second, the Federal Reserve Board unanimously approved a request by the Federal Reserve Bank of New York to decrease the primary credit rate from 3-1/2 percent to 3-1/4 percent, effective immediately." Finally, "The Board also approved the financing arrangement announced by JPMorgan Chase & Co. and The Bear Stearns Companies Inc.," said the Fed's website.
