In a nutshell, that means you should treat a bond fund with an exceptionally high yield in much the same way you'd treat a rabid cobra. A bond fund with a yield well above average is a danger signal that you should never miss. Unfortunately, most investors would love a high-yielding fund now. The fed funds rate is the rate banks charge each other for overnight loans. The Fed's move is designed to keep the economy from falling into recession.
Lower rates make it cheaper for companies and consumers to borrow.
However, at the same time banks were lowering rates for lenders, they were slashing CD rates. Rates on money market mutual funds will fall, too. Money fund yields are now the lowest since mid-1994. People who depend on the interest from money funds, CDs and other savings accounts will be hit hard. Rates this low often prompt investors and fund managers to grab the highest yields they can find.