WOW! Fed raises discount rate!

[Swing low, sweet chariot. Comin' for to carry me home.]

don't have a link, breaking now.

[Swing low, sweet chariot. Comin' for to carry me home.]

here's the story from cnbc"

The Federal Reserve said on Thursday it was raising the interest rate it charges banks for emergency loans, citing improvement in financial market conditions.

The Fed said the discount rate would be increased to 0.75 percent from 0.50 percent, effective Friday.

"Like the closure of a number of extraordinary credit programs earlier this month, these changes are intended as a further normalization of the Federal Reserve's lending facilities," the Fed said in a statement.

"The modifications are not expected to lead to tighter financial conditions for households and businesses and do not signal any change in the outlook for the economy or for monetary policy," it said.

[Swing low, sweet chariot. Comin' for to carry me home.]

This is not a material move, few banks are still using this emergency vehicle.  The move, which was telegraphed in advance, shows the Fed believes liquidity in the private equity market is starting to return.  It’s probably a trial balloon to the market that high interest rates are on the way and though stocks had a good day today, they sold of in afterhour trading the instant the news hit the wires (banks are down about 1.5%).

Personally, I would have waited until a couple of consecutive months of job growth.  But this move is simply symbolic.

[Swing low, sweet chariot. Comin' for to carry me home.]

This is not a material move, few banks are still using this emergency vehicle.  The move, which was telegraphed in advance, shows the Fed believes liquidity in the private equity market is starting to return.  It’s probably a trial balloon to the market that higher interest rates are on the way and though stocks had a good day today, they sold of in afterhour trading the instant the news hit the wires (banks are down about 1.5%).

Personally, I would have waited until a couple of consecutive months of job growth.  But this move is simply symbolic.

fixed