anyone care to give their opinion on this? ie.. is this a disaster....merely delaying the inevitable....???

I think it is a smart move. The first sign that Bernanke isn't as bad as Greenspan.

Care to elaborate on this?  I agree that boosting liquidity even modestly right now will be extremely helpful but I'm not sure that G-Span would have acted differently in this circumstance.  Sure he was a bit compulsive about inflation but he gave the system liquidity when it really needed it.  In 98 after Russia the discount window borrowing rate went from 5 to 4.50.  Same magnitude move we are seeing here.  You do realize that the target rate isn't changing, the secured lending rate is? 

So how is Bernanke better than Greenspan?

The only metric I can conclusively say that Bernanke has Greenspan bested on this soon into his tenure is facial hair.  Bernanke's beard is M-A-N-L-Y!!!!

hmmmmmmm

I never heard these rumours....and I was watching Bloomberg anbd CNBC....I dont know..Maybe I've just been over worked this week and am feeling ultra cynical and paranoid right now.....I'm still not convinced this was a good move by the Fed

these guys get paid $250k a year to come out with that

Not to further break your heart but Bartiromo clears multiples of 250K per year and gets to fly around with powerful business types to boot. 

Greenspan would have already cut the Fed rate by 1% (or more).

http://www.federalreserve.gov/fomc/fundsrate.htm

Please, don't let facts get in the way of your hyperbole but a quick check would reveal this to be pretty much untrue.  Taking 98 (which was worse than this crisis has been to this point) to be a good comp (an article of faith no doubt, but bear with me) we saw three rate cuts for a total of 75bps by mid november.  This is a full 3 months after the default and two months after things started getting extremely nasty.  Lo and behold target rates were back to pre crisis levels by mid November 99.  It looks like an effective use of policy to get through a crisis to me. 

Now you can fall into the camp that will blame the fed policy for the run-up in home prices and ultimately the housing bubble.  That's well and good, but cheap fed funds do not a bubble make.  It takes a great deal of complacancy from the whole financial community to ignore the facts which are now so blindingly obvious and had been obvious to most people paying attention for the past 5 years.  If you want to make a substantial loan to somebody and require less verification than it would take to get a Sears card be my guest, just don't cry to me when you get hurt.  There's a lot of pain out there right now and there's not a single fucking person feeling it who doesn't deserve it.  Idiotic borrowers, opportunistic originators, greedy investors, lax rating agencies, traders with tunnel vision, bankers with short time horizons, every last one of them is getting stomped (including yours truly).  It's their own goddamned fault so don't put it at old Alan's doorstep.   

And for the record, I'm not in the camp that thinks Greenspan is one step removed from Jesus, I just belive he performed more than adequately in an extremely difficult job.  

Agree with you there Roddy..The banks only have themselves to blame. And now they are being bailed out by the Fed..and like you say..this crisis hasnt come any where near 98 levels yet....Talk about Moral hazard....If the Fed bails out the banks this time around then what is to stop banks next time doing something even more stupid knowing full well the Fed will bail them out.....

Lending money to people with no collateral, no jobs, no credit history in the belief in 2 years time they can suddenly afford 10%+Libor on the loan........