Recent federal rate cut is mixed bag of possibilities

[Cal Poly Bot]

The Federal Reserve Board cut interest rates by 0.75 percent last Tuesday in an attempt to calm nervous investors who believe the country is headed for a recession. The stock market responded by swinging up and down wildly.

The cut, which is the largest single cut in 27 years, lowered the federal funds rate, the interest rate banks charge each other for overnight loans to fulfill reserve funding requirements, to 3.

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