The only thing that irritates me about what the Fed is doing right now – providing liquidity, that is – is that the market-based Fed Funds rate has often been below 5% during this liquidity dump. The policy rate is 5.25% and, in theory, there should be some small “penalty” for having to avail oneself of the discount window. Consequently, the market-based Fed Funds rate should be closer to 5.50%. So, while I think it certainly fits the Fed’s job description to provide liquidity via the discount window, it shouldn’t be providing so much liquidity that the market-based Fed Funds rate is 25 bps BELOW the policy rate. This bothers me a little bit.