Does this also include the whole buying toxic assets thing? Not sure where that fits in your 3 options, but it’s definitely something they’ve been doing, to the tune of trillions of dollars.
Common misconception. The 2008 bail-outs weren't run by the Fed but by Treasury, and they weren't grants, they were loans that have been repaid yielding a $110B profit so far, with more to come. [1]
> Not sure where that fits in your 3 options, but it’s definitely something they’ve been doing, to the tune of trillions of dollars.
As you can see from the composition, 'toxic assets' amounted to a grand total of just 2.9% of the bail-out package ($18.6B). It was a one-off, it wasn't 'trillions of dollars' and it wasn't the Fed.
[0] https://www.federalreserve.gov/releases/h41/current/h41.htm#...
As anyone can easily confirm, US treasury bonds and agency-backed bonds constitute the vast majority of the ~$9T owned by the Fed today.
During the global financial crisis, I believe the Fed was given permission (by the executive and legislative branches) to purchase other kinds of bonds, so it coulld maintain financial and monetary stability.