Fed cuts fed fund rate 3/4 percentage point

Fed fund rate is down to 2.25%. But immediately following the news the DJIA dropped 100 points (from +300 to +200) because market was expecting a full point cut. According to MarketWatch, based on futures trading in Chicago, investor's bets implied a 100% chance of a cut of one percentage point.

Dallas Fed president Richard Fisher and Philadelphia Fed president Charles Plosser dissented in favor of less aggressive action.

In a related action, the Board of Governors unanimously approved a 75 basis point decrease in the discount rate to 2.5%.