And then there was the "discount window" lending facility for primary dealers, the first time the Fed to do so since the 1929 Great Depression. Traditionally, the Fed's emergency lending "discount window" only opens to commercial banks in need of short-term cash.
The Fed's decision last Friday to provide emergency funds through JP Morgan Chase to Bear Stearns, the fifth largest investment bank in the country, to help Bear tide over its liquidity crisis, was also the first time since 1929 for the central bank to provide emergency capital to a non-commercial bank.
"The fundamental objective of these moves by the Fed is to boost confidence in the market," said Benjamin Wey, president of investment bank and consulting firm New York Global Group.
Li Shanquan, vice president and portfolio manager of Oppenheimer Fund, said the Fed's move to save Bear Stearn was designed to forestall the likely gigantic shock in the financial market if Bear went under when its liquidity dried up.
"If the US government didn't offer a helping hand, the turmoil on the financial market would further deteriorate," Li said.
US Treasury Secretary Henry Paulson said Sunday that the Fed's rescue of Bear Stearns would prevent other financial firms and even the whole US financial system from suffering even greater harm.
The government will take various necessary measures to ensure the stability of the financial market, Paulson said.
The latest Fed moves, however, apparently failed to assuage worries in the market. By noon Monday, the Dow Jones Industrial Average shed more than 120 points, after going down nearly 200 points in early trading. Key indexes fell by more than 3 percent in Asia's Hong Kong and Tokyo bourses.
