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The Federal Reserve is the nation's first line of defense against recession. Unlike the Congress, which controls taxes and government spending, the Fed can make changes in interest rates on a moment's notice - even late on a Sunday afternoon, as it did on March 15.
The Fed's policy instrument of first resort is its control over short-term interest rates. The specific rate it normally targets is called the federal funds rate - the rate that banks charge to one another for overnight loans of funds held in their