Lowering rates again?

The Fed is talking about cutting rates again. When will these guys figure out that it's a credit SUPPLY problem, not a credit demand problem, and that cutting rates will only make credit supply dry up further. In fact, the Fed should be raising rates, not cutting them.

Consider this, if you had $100 and someone wanted to borrow it, would you be more likely to lend it if they gave you $5 back, or if they gave you $10 back? Assuming you're not a golfer, you said $10. By lowering rates, the Fed would drive down the amount of money that lenders get paid for lending, and make lenders less willing to lend.