The Federal Reserve won't bail investors out of their bad decisions but will act if recent market turmoil threatens economic growth, Chairman Ben Bernanke said Friday.
Mr. Bernanke's much-anticipated speech solidified investor expectations the Fed will cut its target for the federal-funds rate -- charged on overnight loans between banks -- from 5.25% when policy makers meet Sept. 18. Markets see some probability the rate will drop to 4.75% but several economists said a drop to 5% is more likely, accompanied by a statement suggesting more cuts could come. Those expectations helped boost stocks. Read the full speech at this link
Excerpted from Greg at IP
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