The Federal Reserve ("Fed") cut the "discount rate" that it charges banks to borrow money at its Discount Window by 0.25% to 3.25% today (Sunday).  The discount rate cut means it will only be a quarter point over the fed-funds rate of 3%.  The Fed Funds rate remains at 3.0%. 

It also announced a new lending program designed "to improve the ability of primary dealers to provide financing to participants in securitization markets."  The interest rate charged in this lending facility will be at the discount rate, according to a statement from the Federal Reserve.

The Federal Reserve also is broadening the type of debt it will accept as collateral in the lending facility. The Federal Reserve said such loans can be collateralized by a broad range of investment-grade debt securities.