Fed cuts key interest rate half-point to 1 percent

[Doctor_K]

From the AP, courtesy of Yahoo Finance:

Fed cuts key interest rate half-point to 1 percent
Wednesday October 29, 2:54 pm ET
By Martin Crutsinger, AP Economics Writer 
Fed slashes key interest rate by half-point to 1 percent in effort to combat financial crisis

WASHINGTON (AP) -- The Federal Reserve has slashed a key interest rate by half a percentage point as it seeks to revive an economy hit by a long list of maladies stemming from the most severe financial crisis in decades.

The central bank on Wednesday reduced its target for the federal funds rate, the interest banks charge on overnight loans, to 1 percent, a low last seen in 2003-2004. The funds rate has not been lower since 1958, when Dwight Eisenhower was president.

The cut marked the second half-point reduction in the funds rate this month. The Fed slashed the rate by that amount in a coordinated move with foreign central banks on Oct. 8.

In a brief statement explaining Wednesday's action, the Fed said that the "intensification of financial market turmoil is likely to exert additional restraint on spending, partly by further reducing the ability of households and business to obtain credit."

Rest of the article is here:  http://biz.yahoo.com/ap/081029/fed_interest_rates.html

So far, this means the Dow is up by 2.75%, the NASDAQ up 3.25%, and the S&P 500 up 2.7%.  What does this hold for tomorrow, next week, next month, and the recently-newfound strength of the Dollar?  Time will tell.