This is going to be a big week for news on the markets. Today started with the new home sales report, which was pretty poor according to Calculated Risk. CNBC called the report good, and claims the market rallied in response to the report (but the market started going up before the release of the report, so I disagree with that assessment). To be honest, the fact that nothing catastrophic happened this weekend has probably given everyone some hope. It’s the first weekend in a while that we haven’t had something happen.

Today’s big news item was the entry of the Fed into the commercial paper market. And here, the law of unintended consequences has reared its ugly head. Naked Capitalism note Fed Commercial Paper Program Raises Rather Than Lowers Borrowing Rates:

Today was the first day of the Fed’s new program, and in a ringing endorsement of the concept, interest rates on commercial paper increased.

That’s multiple kinds of awesome. The whole purpose of Fed participation is to make borrowing cheaper. Of course, this is just the initial reaction. I’m curious what will happen later this week, when the Fed lowers interest rates (expectations are pretty well set at a 50 bp cut).