Fed slashes interest rate

Today's move was expected, but the intensity was surprising:

The Federal Reserve today lowered its benchmark interest rate by a half point, a forceful policy shift intended to limit the damage to the economy from the recent disorder in the housing and credit markets.

While an interest rate cut was widely expected, there had been profound uncertainty about whether the Fed would choose a more cautious quarter-point reduction. But the bolder action and an accompanying statement, both approved by a unanimous vote of the central bank’s policy-setting committee, made it clear that the Fed had decided the risks of a recession were too big to ignore.

Bonddad and Mark Thoma have already posted their take on today's news.