Knowledge@wharton

It’s been quite a week. Stock markets around the world showed sharp declines on Monday; on Tuesday the Federal Reserve cut its benchmark interest rate by three-quarters of a percentage point. The rate cut helped stem the losses on some indexes but by January 23 the volatility had returned. The obvious fear is one of recession -- a possibility that the White House and Congress are trying to avert by coming up with a stimulus package that will keep the economy off life support. How effective will the Fed’s interest rate cut be and what is the outlook for the Asian and European economies? Knowledge at Wharton asked finance professors Jeremy Siegel and Franklin Allen to comment on these issues. See acast.com/privacy for privacy and opt-out information.