When talking about the financial markets, we usually think in terms of Monday through Friday. Generally, weekends are quiet when it comes to major announcements or news, but this past weekend was different. This weekend, JPMorgan Chase agreed to buy rival firm Bear Stearns for a mere $2 per share. This is a far cry from the $150 per share Bear Stearns was trading less than a year ago. This is significant because it could mean more financial troubles loom for other financial institutions thanks to the current real estate and mortgage mess.
In related news, the Federal Reserve made a surprising emergency rate cut on the discount rate on Sunday to 3.25%, down from 3.5%. This rate doesn't apply to consumers as it is the rate that institutions pay to borrow money directly from the Federal Reserve, but it is a measure that could help ease some of the pressure on Wall Street.
The Fed has also suggested that it is prepared to lower the very important Federal funds rate on Tuesday by a half, or possibly even a full point. This cut would have an impact on many consumers since it is the rate that controls many everyday lending and savings tools. This could include credit cards, home equity loans and lines of credit, and even the interest rate on your savings account. This is good news for your debt, but if you have a lot of cash sitting around, it also means you'll earn less interest. Find out how to prepare for lower interest rates.
In related news, the Federal Reserve made a surprising emergency rate cut on the discount rate on Sunday to 3.25%, down from 3.5%. This rate doesn't apply to consumers as it is the rate that institutions pay to borrow money directly from the Federal Reserve, but it is a measure that could help ease some of the pressure on Wall Street.
The Fed has also suggested that it is prepared to lower the very important Federal funds rate on Tuesday by a half, or possibly even a full point. This cut would have an impact on many consumers since it is the rate that controls many everyday lending and savings tools. This could include credit cards, home equity loans and lines of credit, and even the interest rate on your savings account. This is good news for your debt, but if you have a lot of cash sitting around, it also means you'll earn less interest. Find out how to prepare for lower interest rates.
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