NEW YORK (CNN/Money) - The joke on Wall Street is that the Federal Open Market Committee has become the Open Mouth Committee, taking every opportunity to ensure that everybody knows just what it's up to.

Heaven knows that, in these fragile economic times, Fed members want to keep investors in as cheery a mood as possible. Ruffled feathers won't do anybody any good.

And yet the market is utterly confused about what, exactly, the Fed is going to do when it meets Tuesday and Wednesday. (For a lineup of the coming week's other key events, click here.) Although pretty much everybody agrees that Big Al & Co. are going to drop the fed funds target rate from its already bargain-basement level of 1.25 percent, nobody knows how deep the cut is going to be.

Markets & Economy • Fed: Quarter point? Or a half? • Tech still where the action is • Money Mag: 4 value stocks

Wall Street economists are almost evenly split on the issue, with some expecting a quarter-percentage-point cut and others expecting a half-percentage point.

So, too, are players in the fed funds futures, which price off of expectations for the Fed. Two reporters -- one at the Washington Post, the other at the Wall Street Journal -- thought to have an inside line on goings-on at the Fed have come out on opposite sides of the issue.

The half-a-point crowd thinks the Fed will want to prove that it is taking a no-holds barred approach to the fight against deflation. That would be in keeping with the market's sense that both the Fed and the White House have launched a coordinated "Whip deflation now" effort, and that, combined, they're prepared to pump an obscene amount of money into the economy if that's what it's going to take to get buildings named after you or get reelected.

A half point would also shield the Fed from accusations that it's waffling, and that all the members of the Committee aren't completely behind the effort.

"I think they'll go a half point just so it doesn't appear that they've offered a lame compromise in the fight against deflation," said Lehman Brothers economist Joe Abate.

But the danger of cutting the funds rate so deeply is that the market might interpret it as meaning the Fed is done. Trader chatter would naturally migrate to the topic of when the Fed might raise rates again, and as a result there would be a risk that long rates actually rise. Better, some say, for the Fed to go a quarter point and make it perfectly clear that the next quarter could come at the drop of a hat.

"They know full well what the impact of saying 'We're done' would be," said Morgan Stanley chief U.S. economist Richard Berner. "Our best guess is that they'll do a quarter point and leave the door open for further action."

Another reason the Fed may stick to a quarter point is the untoward effect it might have on debt markets. There is some level on the funds rate where money market funds' business models don't make sense anymore. Nobody is exactly sure where it is, and nobody wants to find out.

Money market funds are the big buyer of commercial paper, the short-term debt instrument that companies use to fund day-to-day operations. If the funds decided to close the door to further investment, a huge wrench would be thrown at the paper market and the repercussions would be downright ugly.

The general sense is that a funds rate of 0.75 percent wouldn't be low enough to cause problems, but at a rate of 0.50 percent some of the smaller money funds might throw in the towel. Since the need for an emergency could always arise, the Fed might want to play it safe and toe the line at 1.0 percent.

Because the market is so divided over how far it is going to go on rates, and because an upbeat market has come to be seen as such an important factor getting the economy revved up, the Fed will probably resort what has lately been the most powerful in its arsenal: Its jawbone.

The Fed statement after its May 6 meeting, where it held rates pat, worked wonders on the market. By implying that it will not raise rates for a very long time, the Fed engineered a more-than-half-point drop in the 10-year Treasury rally, and helped inspire a 7 percent move higher in the S&P 500. Similarly strong language could do wonders for the market in the week ahead.

• The Conference Board's consumer confidence index comes out Tuesday. Economists surveyed by Briefing.com think it ticked up to 85 for June from May's 83.8.
• The Federal Open Market Committee meets Tuesday and Wednesday. The market is divided over whether it will cut the fed funds rate, currently at 1.25 percent, by a quarter point or a half.
• Economists think that durable goods orders for May, due out Wednesday, ticked up by 1 percent after falling 2.4 percent in April.
• New home sales, due out Wednesday, are forecast to come in at an annualized 1.03 million for May, up from April's 1.028 million. Existing home sales are expected to drop to an annualized 5.8 million from 5.84 million.
• The government's final take on first-quarter gross domestic product, out Thursday, is expected to show growth of 1.9 percent -- in line with the previous report.
• May personal income, due out Friday, is expected to show a pickup of 0.3 percent compared with April's flat reading. Personal spending is expected to come in up 0.2 percent after falling by 0.1 percent in April.
• The University of Michigan's final take on its consumer sentiment index for June, due out Friday, is expected to come in at 88, up from the initial reading of 87.2.