WASHINGTON — In a bold strike, the Federal Reserve slashed a key interest rate by a half point on Tuesday _ the first cut in over four years _ and left the door open to further relief to prevent a painful housing slump and jarring credit crunch from driving the country into recession.Wall Street responded enthusiastically, propelling stocks up 335.97 points _ its biggest one-day point jump in nearly five years. Politicians, shaken by record-high home foreclosures, also welcomed the move.In a crucial and anxiously awaited decision, Federal Reserve Chairman Ben Bernanke and his central bank colleagues lowered an important interest rate to 4.75 percent. Economic and political pressure has been building on the Fed to act.As a result, Wells Fargo, Bank of America and other commercial banks dropped their prime lending rate charged to millions of borrowers by a corresponding amount to 7.75 percent.Whether Bernanke can handle the crisis successfully is the biggest challenge he has faced in his 19 months at the Fed helm."Today's action is intended to help forestall some adverse effects on the economy that might otherwise arise from disruptions in financial markets and to promote moderate growth over time," the Fed said in a statement released after its closed-door meeting.The Fed's action means borrowers who can obtain credit should see rates drop on a variety of loans. It will become less expensive for people to finance certain credit card debt and for homeowners to take out popular home equity lines of credit, which often are used to pay for education, home improvements or medical bills.And, it will help some homeowners whose adjustable rate mortgages reset in the fall. Those rates will still go up but not by as much as they otherwise could have, analysts said.Less immediate will be relief for the country's economic health. The rate reduction could take three to nine months to ripple through the economy and bolster overall activity.The aggressive action underscored the Fed's resolve....
