The Federal Reserve's big defense is cutting interest rates, and most people expect a big slash of three-quarters of a percentage point on Tuesday.

But I don't think it will help much in easing the invester's fears.

"It doesn't help the problems. I believe that financial markets are just scared.The fed's can't bailout everybody .The real problem is that property values continue to drop,so the fed's can cut rates all that they want but the real problem lies in the property values.Somehow they need to find a way to start bringing the values back up so that people will start spending money again.They can lower rates to 0% but if the value is simply not there nothing can be done.   

In the past week, investors have come to expect even more aggressive action from the Fed. The programs that they have came up with in the past are just bandaids that will help a small percentage of borrower's but the majority of the borrower's are in situations where they owe more than what their homes are worth.

The american home owner's have already lost 2.2 trillion in home equity values.Being in the mortgage buisness myself I see it time and time again from borrower's wanting to lower their monthly debts by refinancing but they have no equity left in their homes to do so.

The investment bank bear sterns didn't help any they've also scared investor's now they seem to think that the wall street banks are now at risk.Shares of lehman brother's went down about 25% on monday. 

  The Fed took steps to assume some of that credit risk last week when it agreed to accept mortgage backed securities as collateral.

Most people think that the fed's have no choice but to keep cuttuing rates.It does help alittle but it doesn't fix the main issue ,but it is better than nothing.It doesn't matter what the fed's seem to try and do as long as they keep cutting rates the investor's will see that as a sign that the central banks are in trouble.

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