Band aids for the Economy

You can see from his expression that Secretary of State Henry Paulson is less than enthusiastic about the $800 per person credit that President Bush is trying to push through Congress. Hundreds of billions, spent on food, mortgage payments, or flat screen TVs??
A more dramatic action was taken by The Federal Reserve this morning, cutting interest rates three quarters of a percent. The unplanned cut came after two days of massive losses in stock markets around the world but was not enough to prevent Wall Street from opening today to a dismal start.
This move comes after stock markets in Asia and Europe saw some of the steepest one-day slides in decades based on fears that America's economy is collapsing, and a lack in confidence in President Bush's ability to pull the American economy away from recession. The expectation is if America's economy falters, the effects will be felt around the globe.
Mellody Hobson, president of Ariel Capital Management and a "Good Morning America" financial contributor said "A sneeze in the United States can cause a flu around the rest of the globe."
The key Fed Funds interest rate now stands at 3.5 percent, and the Feds may lower the rate even more at their regular meeting next week. We are already seeing fixed conforming mortgage rates of five and a half, with no points, but funds will have to be more liquid for jumbo rates (over $417,000) to drop.