The Economy: An Unmistakable Signal

THE ECONOMY

The U.S. economy collected a surprise dividend last week from its new burden of higher taxes. In a move that most moneymen had not expected for weeks or even months, the Federal Reserve Board lowered its discount rate from 51% to 51%. Though the 1% change was as small as the Reserve Board ever makes it, it was an unmistakable signal of a general trend toward lower interest rates on all kinds of loans.

The reduction dropped the economy's key interest rate below the crisis level, highest since 1929, to which the Reserve Board pushed it last April in its effort...

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