To restart these markets, the Federal Reserve worked with the Treasury in establishing the Term Asset-Backed Securities Loan Facility (TALF): The Federal Reserve supplied the liquid funding, while the Treasury assumed the credit risk. The issue of the appropriate role of the central bank and fiscal authority was present in other contexts as well.
We were well aware that we were possibly assuming a risk of loss when we lent to stabilize the systemically important firms of Bear Stearns and American International Group (AIG). Unfortunately, at the time, alternative mechanisms were not available and we lent with  3  Walter Bagehot ([1873] 1897), Lombard Street: A Description of the Money Market (New York: Charles Scribner’s Sons).