WALL STREET: Down Margins

The stock markets, which have been in the doldrums for months, this week got some long-awaited good news. The Federal Reserve Board cut the cash required for stock purchases from 75% to 50% of the stock price, the first margin reduction in over two years. FRB said it was relaxing margins “in the light of the general credit situation”; credit on stocks was near an alltime low. In effect, FRB was saying in another way that the danger of inflation was about gone.