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It is true that overall flows of credit have fallen steeply.
"By potentially restricting future flows of credit," he said, "the developments in financial markets post a significant threat to economic growth".
But if they were managing risks, how could it be that leading financial institutions flirted with total ruin and that the usual flows of credit were frozen solid?
"Fiscal policy can stimulate economic activity, but a sustained recovery will require a comprehensive plan to restore normal flows of credit.
The policy involved allowing banks and other financial institutions to exchange bonds for cash, and the hope was that this would lead to improved flows of credit to firms looking to expand.
One line from his "Essays on the Great Depression" sounds especially prescient today: "To the extent that bank panics interfere with normal flows of credit, they may affect the performance of the real economy".
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The Fed plan is intended to renew the flow of credit on which the economy depends.
You see, the flow of credit is the lifeblood of our economy.
Restoring the flow of credit in the economy will be crucial to the recovery.
"Our economic system is critically dependent on the free flow of credit".
Problems at one bank can affect the flow of credit to firms across the entire economy.
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Justyna Jupowicz-Kozak
CEO of Professional Science Editing for Scientists @ prosciediting.com