What will the Fed do?

The Federal Open Market Committee is expected to announce a third consecutive cut in the federal funds rate today. Equities were up early, but have fallen to near their open in advance of the announcement which will come later today.

It would seem that the Fed is anticipating a slowdown in economic growth as the global economy works through the problems in the credit markets created by the meltdown in securities backed by subprime and adjustable-rate mortgages (ARMs), as well as the anticipated impact of expected significant declines in home prices in the US and UK.