What was going on when I was born?

In a clear signal that it expects interest rates to decline further, the Federal Reserve Board announced yesterday that it had lowered the interest rate it charges on loans to banks to 9 1/2 percent from 10 percent. Even before the late-afternoon announcement, the stock market surged for the third consecutive day, with the Dow Jones industrial average rising 20.88 points, to 986.85, its highest level in more than two years. Analysts attributed the bull market to the widespread belief that the Federal Reserve was easing monetary policy, an expectation that was reinforced by the cut in the discount rate. Interest rates declined sharply in the bond and Treasury bill markets following the Federal Reserve's announcement of the cut in the discount rate to its lowest level since November 1978. The rate has come down from 12 percent this past summer.

John A. Cody, the head of a key teamsters local in the metropolitan New York area, was convicted today of Federal charges of labor racketeering and tax evasion. Mr. Cody, who is 62 years old, was found guilty of seven of eight charges. The jury returned its verdict in Federal District Court here after one day of deliberations. As president of Local 282 of the International Brotherhood of Teamsters, Mr. Cody is one of the most influential figures in the metropolitan area's construction industry.

When the unemployment figure of 10.1 percent was announced in Washington yesterday, Democrats got the political lever that they believe can turn the 1982 election into a sweeping victory. Republicans got the chill statistical news they feared, but they said it was only one part of this year's political equation. Robert Squier, in Memphis to make a new television commercial for Senator Jim Sasser, Democrat of Tennessee, stressing the double-digit rate, saw the psychological impact as dramatic. ''It's like breaking the four-minute mile in politics,'' he said. Senator John C. Danforth of Missouri, a Republican campaigning in St. Louis, called the numbers a ''real tragedy, a human tragedy.'' He said he hoped that Missouri voters would be patient but added, ''I'll let you know in three and a half weeks.''

Unemployment in September rose three-tenths of a percentage point to 10.1 percent of the work force, the highest monthly figure in 42 years, the Labor Department reported today. The figure took on political significance because it is the last that will be announced before the midterm Congressional elections Nov. 2. Republicans, led by President Reagan, and Democrats, hoping to take firm control of Congress, quickly began blaming each other for the latest sign of the faltering economy. According to the seasonally adjusted figures compiled by the Bureau of Labor Statistics in its monthly survey of 60,000 households, more than 11,260,000 people out of a civilian labor force of 110,980,000 were out of work last month. This was an increase of 450,000 since August and more than three million in the last 12 months.

The Polish Parliament overwhelmingly approved a law today that bans Solidarity, the independent trade union that once captured the imagination and allegiance of nearly 10 million Poles. The law abolishes all existing labor organizations, including Solidarity, whose 15 months of existence brought exhilaration to many but drew the anger of the Soviet Union and other Eastern-bloc countries. It replaces them with a new set of unions whose ability to strike is sharply restricted. Reaction of Work Force Uncertain The scattered, fugitive Solidarity activists, more than 600 of whose leaders are in custody under martial law, have given no indication of their response to the Government edict outlawing their organization.

Four American companies that were awarded nearly $6 million in claims against the Iranian Government by an international tribunal have not been paid because Algeria has not authorized release of the funds, American and Algerian officials indicated today. Payments must be approved by Algeria under the agreement that freed American hostages in Iran 18 months ago. Algeria is an intermediary because of its pivotal role in the hostage negotiations. Algeria has approved similar payments of about $1.75 million to six American companies, and it is not known why it has declined to approve the latest awards. The companies' claims involve business losses in connection with the Iranian revolution.

In its drive against leftist guerrilla groups, Guatemala's Army is making regular incursions into Mexico, causing terror among the 30,000 Guatemalan refugees camped near the border and posing an increasingly difficult problem for Mexican authorities. Although Mexico formally protested last month for the first time over two incidents that resulted in the deaths of five Mexican citizens, it has so far tried to avoid heightening tensions and has not militarized its side of the 565-mile-long border. Yet Guatemala's civil war is spilling across the border more seriously than Mexico has so far publicly admitted. ''The incidents have been constant,'' a Mexican official conceded. ''The Guatemalan Army is virtually lined up on the other side of the border and seems to be acting with impunity.''

The Honduran Foreign Minister said at the 37th session of the United Nations General Assembly today that his country had been working to solve some of the conflicts in Central America but was now threatened by those conflicts and by regional terrorism. The Foreign Minister, Edgardo Paz Barnica, said Honduras was working with Costa Rica to establish a forum for peace, and he hoped that Nicaragua would contribute. At an earlier news conference, Nicaragua's Foreign Minister, the Rev. Miguel d'Escoto Brockman, offered another view of the situation. He said a United States-inspired invasion of Nicaragua from Honduras was imminent.

President Reagan pledged to Presidentelect Miguel de la Madrid Hurtado of Mexico today that the United States stood ''ready to work with you'' to solve Mexico's economic difficulties. At the same time, Mr. Reagan said, the United States recognizes Mexico's right to solve its problems ''in its own way.'' Meeting first in Tijuana, Mexico, just south of the border near here, and then at this California seaside resort, Mr. Reagan acknowledged that his Administration and the Mexican Government had disagreed on many things. But he pledged cooperation in an atmosphere of ''mutual respect.''

The leaders of France and 18 African countries began meetings here today in an effort to find a way to save the Organization of African Unity, the regional group that virtually collapsed this summer. There was no formal agenda for the sessions, which are officially part of the ninth gathering of leaders of France and French-speaking African countries. If there is any progress concerning the O.A.U., it is expected to come in private discussions and not in the public sessions. The last attempts by the O.A.U. to stage a summit meeting fell apart in August in the dispute among members about whether to recognize the Polisario guerrilla movement that is fighting to overthrow Moroccan rule in the Western Sahara.

More than 100,000 jubilant Bolivians turned out today to welcome back President-elect Hernan Siles Zuazo after more than two years in exile. Political leaders said it was one of the largest rallies here in memory. The people, most of them Indian peasants and poor workers from around the country, cheered and screamed as the 68-year-old Mr. Siles Zauzo, a short, lean man with thick glasses, addressed them from the back of a truck in front of the Church of San Francisco in a central plaza. 'Absolute Liberty' Promised ''We're going to construct a democracy with absolute liberty,'' he said ''Those who do not believe in democracy,'' he added, in a clear allusion to many in the military, ''and have interrupted it many times, depriving people of their liberties, should reflect and understand that their time has come to an end.''

In what was hailed at the time as a landmark decision, South Africa's highest court ruled two years ago that the authorities who regulate the movement of blacks could not prevent a woman from living with her husband if he had a right of permanent residence in an urban area. The ruling in that case, which was brought on behalf of a black woman from Cape Town named Nonceba Meriba Komani, led eventually to the first significant relaxation in a generation of the system of ''influx control'' that is designed to keep most of South Africa's 22 million blacks living in their impoverished rural ''homelands.'' But this week the Government of Prime Minister P.W. Botha, which once said it had ''accepted'' the Komani ruling, threatened to enact new legislation to nullify it and thus make it impossible for black husbands and wives to live together in urban areas unless both of them had established the right of permanent residence.