The Fed has had to get a little creative

— -- The Federal Reserve has used all its traditional tools — and some new ones — as it grappled with a spreading credit crisis. Among them: deep interest rate cuts. Low-cost lending to banks and investment banks. Credit swaps with other central banks. And providing financing sources for the shutdown of investment bank Bear Stearns and the rescue of troubled insurer AIG.

The rescue package moving through Congress is designed to help financial regulators to a more systemic approach. It would let the Treasury Department buy up to $700 billion in distressed assets, which would help set a floor under asset prices and help financial firms rebuild capital and confidence.

The Fed may still have to lean on its existing array of tools even if Congress approves the bill. Some of the Fed's efforts over the past year:

•Cutting the key federal funds rate, which is what banks charge each other for overnight loans. The rate is used as a benchmark by lenders for business, auto and other consumer loans.

•Cutting the interest rate the Fed charges banks that want to take out direct loans.

•Pumping cash into financial markets through a variety of mechanisms including so-called repurchase agreements, which are essentially short-term collateralized loans.

•Creating auction programs to provide funds to commercial banks and financing to investment banks.

•Offering a loan to insurance giant American International Group to stave off a potential bankruptcy that could have had widespread impact throughout the system.