By Jeannine Aversa
AP Economics Writer
WASHINGTON — The Federal Reserve has ordered an emergency interest rate cut of a half a percentage point to cope with the worst financial crisis since the 1929 stock market crash.
Fed Chairman Ben Bernanke and his colleagues ratcheted down their key rate by 0.5 percent, to 1.5 percent. The action revives the central bank’s rate-cutting campaign which had been halted in June out of concerns that those low rates would worsen inflation. Since then, however, economic and financial conditions have dangerously deterioriated, forcing the Fed to reverse course.
The fact that the Fed felt it could not wait until its regularly scheduled meeting late this month underscored the urgency of the situation.
See tomorrow’s Chattanooga Times Free Press for complete coverage.
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Well, let's see.
Easy [that is, cheap] loans were the supposed cause of the crash, right? So what does Congress and the Fed do? Buy up the banks' bad loans so they can use the lowered Fed interest rate to give MORE deadbeats and poor credit risks MORE loans for Congress to buy up. Vicious circle...and guess who is in the middle.
What is wrong with this picture?
Hate to say "I told you so", but I told you so.
The $700,000,000,000 was ONLY to save the investment bankers [who, under Federal law, have no relationship with savings banks -- the ones we ordinary people use for checking/savings, etc.]
That money was NOT to protect the economy -- the one me and thee know and use -- and it didn't and it won't. It just keeps the mortgage folks solvent and able to make more poor loans...and our taxes high enough so we have no money to "stir up trouble".