Here’s an idea for Fed. If you really want to rebound the economy, allow individuals with a good credit rating to also get short and long term loans straight from the discount window at 2.5%. I would take that money and invest and support the economy, and you won’t have to bail me out right before bankruptcy. Say something like up to 50% of my adjusted gross income.
Bloomberg.com: Worldwide The Federal Reserves cash loans to securities firms rose 16 percent to $38.1 billion over the past week, as Wall Street dealers took greater advantage of the new tool designed to ease strains in financial markets. Separately, direct lending to commercial banks through the traditional discount window rose about 12-fold, or by $6.46 billion, in the week ending yesterday, to a daily average of $7.01 billion. Other credit extensions including loans to facilitate JPMorgan Chase & Co.s purchase of Bear Stearns Cos. showed a zero balance as of yesterday, according to the Feds weekly balance sheet. The report listed loans to Wall Street firms under a plan announced March 16 to alleviate a cash shortage. The central banks Primary Dealer Credit Facility allows Wall Street banks to borrow money overnight at a 2.5 percent interest rate, the same charged to commercial banks. Fed Chairman Ben S. Bernanke said in congressional testimony this week that the program and others have helped alleviate some of the strains in financial markets.