Stocks soar on news of Fed easing credit crunch

The Dow-Jones average zoomed more than 300 points higher in early trading today on news of worldwide monetary easing of the European Union's monetary woes.

The Dow Jones Industrial Average was adding 391.5 points at 11,947. The S&P 500 was up 38.4 points at 1,234, and the Nasdaq was rising 78.4 points at 2,593.

The Federal Reserve and central banks of western nations announced credit easing moves to monetize debt and bolster economies of troubled nations.

Central banks throughout the EuroZone will lower the pricing on all existing temporary US dollar liquidity swap arrangements by 50 basis points. The new rate will take effect on Dec. 5.

China's central bank said Wednesday that it will cut the reserve requirement ratio for lenders by 50 basis points starting Dec. 5. The move, the first since Dec. 2008, is expected to help bolster China's economy and increase liquidity as the markets in developed nations remain unstable.

The rate cut may also signal that China will consider loosening its monetary policy in the future. Markets were becoming optimistic about the possibility that the Asian superpower will once again come to the rescue of the global economy.

Standard & Poor's lowered the credit rating of most major banks due to worries that they will not be able to withstand the credit crunch should the European nations' credit problems cause a worldwide cascade, tightening non-existent money supplies and causing havoc with commercial transactions, payment of corporate bills and meeting payrolls.