Powell’s success at the Fed is a reminder of the importance of expertise

As the coronavirus crisis has rocked the world, America has been a sluggish and unreliable global leader except in one critical area — the Federal Reserve’s prompt moves to pump cash into traumatized international financial markets.

Federal Reserve Chair Jerome H. Powell has been innovative in creating new monetary tools that can keep money and confidence flowing. The system was starting to freeze last week, as mistrust and panic spread. Powell responded with new credit facilities to signal that the Fed would do whatever was necessary to keep the system working, and traders say market anxieties have eased.

The Fed has been grappling with the gut problem: What happens when cash flow essentially stops in the United States because of the economic lockdown? While Congress was still haggling over its $2 trillion rescue package, the Fed last week began creating emergency facilities that could tide over businesses (and their employees) until the crisis eases.

The Fed’s infusion of cash will touch every part of the economy. The central bank will help small and medium-size companies borrow on soft terms through a “Main Street” lending window to pay salaries and bills; big companies can roll over debts through a “primary” Fed facility; secondary markets for mortgage-backed securities and other debt, which were near meltdown last week, will get a third Fed fire hose of cash.