What central banks can do to help contain a financial crisis  It follows logically from the points I have just made that the central bank, as the only player that has no liquidity constraints, can and should help to overcome a liquidity crisis by injecting additional cash into the system.
In doing so, it should use all available instruments, but should not take on excessive credit risk. Its objective of providing the financial system with adequate amounts of liquidity needs to be carefully weighed against the need to avoid central bank losses or the moral hazard of encouraging excessive risk taking by financial institutions.