It's amazing how you all believe that the FED raises or drops rates because the T.V. says so...but you don't believe a whole pile of other stuff the T.V. tells you is truth...
The Bond markets are where Interest rates are set...and consumers drive the bond markets...THE FED JUST FOLLOWS ALONG...
For months now the Bond markets have been getting bid up resulting in yields dropping...
The purpose of fooling you all (peasants) into believing Bernanke sets rates is so that "HE" can take the blame (It's why he was installed as chairman) when things start looking ugly...The System itself escapes...
In 5 years of staring at Interest rates...I have not seen the FED do anything to raise or lower them...
The below chart clearly shows that short bond yields were rising and falling well before the FED was forced to raise or cut...It's been like that for decades...
The current 0.5% cut is to play catch up...Bonds back the US Dollar ultimately...and short bonds have been caving in...for months
Currently there are not enough bonds and too many dollars in circulation...
Price of Bonds get bid up causing yields to drop...
Same thing was playing out 2000-2003...fortunately 9-11 happened which gave Congress a reason to create a massive pile of new bonds to stop the collapse in yields...The War on Terror...
Going to need something like that again to stop this collapse in yields/Interest rates...
Either a whole pile of new bonds or consumer exhaustion which will rapidly cause consumer requests for commercial banks to manufacture new money to slow significantly.
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