The Federal Reserve has given the credit markets a big dose of a medicine. In a surprise move, it cut the discount lending rate by half a point. It's meant to relax the credit squeeze and that's giving the markets a healthy boost.
European banks tied into subprime debt are now rushing to buy U.S. dollars to pay back those loans, which is raising the value of the flailing currency. But Ashley Milne-Tyte reports it may just be a short-term fix.
Doing the numbers is starting to get downright gloomy. Markets in Asia and Europe are dropping by 2 and 3 percent after yesterday's Wall Street plunge on continuing subprime concerns. This time mortgage lender Countrywide was the biggest troublemaker.
Commentator Robert Reich says the full-blown credit crisis of recent weeks is the price we're paying for letting financial entrepreneurs take over our economy, a problem that's not going away unless we level the playing field.
Uncertainty continues to plague stock markets here and around the world. And after an unusual profit warning from Wal-Mart yesterday, overseas investors are particularly concerned that American consumers are out of spending money.
Some pundits are pinning the blame for market uncertainty of late to former Fed chairman Alan Greenspan, but is it fair to second guess 18 years of decision-making in hindsight? Besides, he did warn borrowers two years ago, John Dimsdale reports.
Wall Street wants a rate cut, but some folks are still stuck on inflation worries and hoping to see a bump in the other direction. Meanwhile, the Fed's been happily holding steady. What next? Stacey Vanek-Smith sorts through the speculation.