Rate Cut

The breaking news this morning is that the Fed cut its interest rate from 2% to 1.5%. This is being done in an attempt to prevent a global economic meltdown (too late). Along with the Fed, the European Central Bank cut its rate by 0.5% to 3.75% and the Bank of England cut their rate by half a point to 4.5%. The Central Banks of China, Canada, Switzerland and Sweden also cut their rates.

The rate cuts will reduce borrowing costs for Americans who have home equity or other floating rate loans tied to the prime rate.