The Federal Reserve surprised everyone Tuesday with an emergency intersession rate cut of .75%, the deepest cut in the Fed Funds Rate since 1984. The Fed Governors are acting in direct response to recent reports that the country is on the brink of recession, but what does this doe to your 30 years mortgage rates?

U.S. Federal Reserve in an emergency meeting cuts interest rates, which follows major corporations such as Bank of America and Vachovia to lower their prime rates.

Effective today, Wachovia Corporation (NYSE:WB) lowered its prime interest rate to 6.50 percent from 7.25 percent at Wachovia Bank, National Association and all of its other banking subsidiaries.

Bank of America, N.A., LaSalle Bank N.A. and LaSalle Bank Midwest N.A., announced today that they are lowering their prime-lending rates to 6.50 percent from 7.25 percent, effective January 22, 2008.

European stock markets appear to have rallied after the severe losses recorded when they opened this morning. Following news of continued falls on the Asian markets, Amsterdam's AEX lost five percent soon after opening.

Fed rate cut of .75 percent sunned the markets this morning. The Federal Open Market Committee has decided to lower its target for the federal funds rate 75 basis points to 3-1/2 percent.

Australia's Opposition Party laid blame for recent interest rate increases at the feet of new federal treasurer Wayne Swan. Swan, in turn, criticised the banks, saying they risk being "judged very harshly" if they "try to take advantage of the U.S. sub-prime crisis by lifting interest rates excessively."

The Bank of England’s Monetary Policy Committee today voted to maintain the official Bank Rate paid on commercial bank reserves at 5.5%.

The European Central Bank is offering banks unlimited emergency loans at below market rates, in a co-ordinated bid to inject liquidity into the money markets.

We have been watching the growing pessimism of small business owners over the past few months as seen through the NFIB's monthly survey. It now looks like the Federal Reserve is the Grinch that has stolen entrepreneurs' Christmas.

The stock markets in USA are looking to make modest gains and to the possible Federal reserve interest rate cut. Fed's rate cut action may overshadow the subprime losses and give the markets a lift.

Bank of England Reduces Bank Interest Rate by 0.25 Percentage Points to 5.5%.