I won’t review in detail the kaleidoscopic gallimaufry of actions that we took to address the dysfunctions I’ve just been describing: emergency lending facilities under section 13(3) of the Federal Reserve Act to support liquidity in funding markets; similar facilities to support credit to nonfinancials; direct purchases of Treasuries; swap lines and repo facilities with foreign central banks. These are fully described elsewhere.
Fundamentally, each measure was designed to address an aspect of the pressures created by the large demand for cash in the real economy and the temporarily limited willingness of financial firms to provide it. Our liquidity facilities relieved pressure on markets created by mass liquidations of assets driven by the demand for cash, as did our direct purchases of Treasuries.