As markets around the world continue to be hammered by the financial crisis, the Federal Reserve cut the Fed Funds interest rate by a half point in a move coordinated with central banks in the UK, European Union, Switzerland, Sweden, and Canada.
China also cut its key rate.
Overnight, Asian markets took a nosedive, with Japan’s Nikkei dropping more than 9%, while Europe rebounded from sharp falls earlier in the day.
U.S. stock future are up on the news of the rate cut.
Expect a rally this morning, but don’t be surprised if it doesn’t last through the day.
In related news, the UK is stepping up to partially nationalize two more banks. They are injecting capital in exchange for equity. Exactly what the U.S. Government should have done.