Monday, March 17, 2008

The Fed Has Cut the Discount Rate and Will Lend to Security Firms

The Fed has been busy. They cut the discount rate; they strong armed J.P. Morgan to buy Bear Stearns and Bear Stearns to sell themselves; and they lent J.P. Morgan $30 billion to make all this work. The repo market has seized up and that interferes with the Fed's ability to conduct monetary policy.

Hear more from the Wall Street Journal.