Fed cuts interest rates another half point.

The Federal Reserve cut the short-term interest rate half a point for the tenth time in 10 months last week.

Meanwhile, consumer confidence continues to wane as unemployment rises throughout the nation.

The Federal Reserve is hoping that a rate cut will boost consumer spending as we approach the holiday season, a crucial time of year for retailers.

Prior to the announcement, there was much speculation about how much the Fed would cut rates. Many economists accurately predicted the half-point reduction, which was the third cut of that size since the Sept. 11 attacks.

The decision to lower by half a percentage point indicated that the Fed is aggressively seeking to jumpstart the economy. Future uncertainty has forced businesses to curb investments in the face of cheap credit.

During the Fed's last meeting on Oct. 2, the federal funds rate--the interest that banks charge on overnight loans--was cut to 2.5 percent, the lowest that it has been since May 1961.

"Uncertainty is very high right now. But this will help long term," said Peter Pattison, a real estate consultant.

One economist predicted that the Fed would lower rates again before December.

"Rates are--and will be--going lower. I'm not at all surprised by the half-point drop," said Dennis Irving, executive director of Cushman & Wakefield's financial services group.

The rate cut dropped the rate on overnight loans between banks to 2 percent. The federal funds rate likewise fell from a cyclical peak of 6.5 percent all the way down to 2 percent

Another Cushman & Wakefield source gave reason to be optimistic about real estate investments.

"There are several factors that make real estate a good play for 2002," said Tim Welch, executive managing director of financial services at Cushman & Wakefield.

"The lowest interest rates since the Kennedy Administration, a wealth of capital available and generally sound real estate fundamentals bode well for the market," he said.