The Fed Has Cut The Key Interest Rate by Half A Percentage Point

The Federal Reserve acted on calming the market by dropping the Key Interest Rate by half a percentage point today. It was expected that the Fed would meet today and drop the interest rate a quarter point. With the worst housing market in 16 years it is apparent that this drop was needed, although some economists predict three or more rate cuts to avoid a recession. Fed Chairman Ben Bernanke is walking a thin line between dropping rates and stirring up a side of inflation. There has been an ease in inflation pressure helping the Fed in their aggressive and needed handling of the housing market. In the end a recession will probably be averted if the Fed continues to keep aggressively involved.