– As rumored, the world’s central banks have announced a coordinated rate cut to try to juice up the frozen credit markets. The Fed has cut its key lending rate by a half point to 1.5%. The European Central Bank trimmed cut its key rate to 3.75% from 4.25%. The Bank of England cut its key rate to 4.5% from 5%.

– According to a  joint statement by the participating banks, “inflationary pressures have started to moderate in a number of countries, partly reflecting a marked decline in energy and other commodity prices,” while “the recent intensification of the financial crisis has augmented the downside risks to growth and thus has diminished further the upside risks to price stability.” 

– Dollar Libor — the cost of borrowing in dollars overnight in London — had hit new highs prior to the rate-cut news. It was up 144 basis points to 5.38%.

– Yesterday, the Fed said it will double its cash auctions to banks to as much as $900 billion to help ease the liquidity crunch.

– The move came after Japanese stocks plunged 9.38%. It was the biggest one-day loss in more than two decades. The Nikkei-225 index dived 952.58 points to end at 9,203.32.

– Other major Asian indexes also got crushed. Hong Kong’s Hang Seng Index fell 8.17%. Indonesia’s Jakarta Composite fell 10.38%.

– US stock futures, however, are up after news of the rate cut lifted sentiment. According to MarketWatch, “stock market futures were volatile after the move: a big spike at first, then more moderate gains, and then another pick-up. At 8:10 a.m. Eastern, S&P 500 futures rose 22.8 points to 1,028.30 and Nasdaq 100 futures added 22 points to 1,358.50. Dow industrial futures rose 152 points.”

– In Britain, the rate cuts came after an announcement by the government there that Britain’s largest banks are to be part-nationalized. According to the Financial Times, however, “the scheme failed to stabilize shares in the UK’s biggest banks and the FTSE 100 fell another 223 points or 4.8 per cent to 4,382.5.W

– The fall in stocks has wiped out about $2 trillion in Americans’ retirement savings in the past 15 months.

– Gold is up for a third day in London as investors seek safety from plunging equities.