Well I thought they already did something like that before and thought why would banks be encouraging more risk and exposure with the mess we're in now? But then I saw the quoted average rate, and thought its been a decade since they were that high. After realizing this was published almost a decade ago, it reinforces the fact that even though you may not immediately feel the pinch now, you will when you're denied credit or a loan based on ill-advised stimulus plans last century.
Banks are in a panic now - I'm trying not to lose sleep over this debacle but its making my job a bit of a roller coaster at the moment. Its really unprecedented what's taking place in the financial markets but each time the fed cuts the prime lending rate half a point, expect the banks to add more of a spread to make up for their losses when they resell the loan on Wall St. I wouldn't be surprised if Bernanke cuts it a full percentage point. Good for the banks when transacting with each other here and abroad, but bad for Joe Sixpack who'll be scrutinized for every expense in his credit history to justify him a loan; as long as there's uncertainty in the market due to uncertainty of the bailout's success, banks will be more tightfisted to avoid another fiasco. The cut is supposed to counter that but when the market indexes tank almost everyday, I fear for the future.