Fed Cuts Rate to Record Low: "Range of 0%-0.25%"

Stocks soared after the Federal Reserve cut interest rates to the lowest level ever: 0% to 0.25%. The Dow closed just under 9,000 points, at 8,924 (gaining 350 points/4.3%) while the Nasdaq was up 5.4% and S&P 500 rose 4.5%. The NY Times points out the Fed's move "bring[s] the United States to the zero-rate policies that Japan used for six years in its own fight against deflation." The Fed said it would use all its "available tools" to continue to help the economy (Bloomberg News notes, "Nine rate cuts in the prior 14 months and $1.4 trillion in emergency lending failed to reverse the economic downturn."). And former St. Louis Fed president William Poole told Bloomberg TV, "The Fed is sending a message that it will print money to an unlimited extent until it starts to see the economy expanding." Graphic: NY Times

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By Jen Chung in News on December 16, 2008 5:27 PM

Comments [rss]

JacqueMehoff

the news showed people on the trading floor practically jizzing in thier pants but what does this really mean?

Shinobi Shaw

WEIMAR style baby!

NannyState

The Fed will truly make us all billionaires.

(when a billion dollars is what it takes to buy a loaf of bread)

Spirit of 76

No, we got into this mess because the Idiot-in-Chief kept denying for years and years that the economy was in trouble. There's a lesson to voters in here, assuming they ever get the message. Don't ever put a Bush in the top spot. Every time a Bush is president, we get a recession.

unregistered_wiseguy

Maybe I missed something really REALLY basic in the discussion, but ...

...didn't we get into this mess because of the politicians tampering with the economy?

Is the best way to put out a fire to throw gasoline on it?

ANGRYGOD11

Japan tried to jump start their economy in the 1990's by trying the same thing. Result: They refer the 1990's as The Lost Decade.

drewo

And former St. Louis Fed president William Poole told Bloomberg TV, "The Fed is sending a message that it will print money to an unlimited extent until it starts to see the economy expanding."

Or until the rest of the world decides our money is worthless.