Once upon a time, US commercial banks took deposits from their customer and used the money to buy bonds (mortgage backed securities).
Then came the dark times when the prices of houses fell and it was feared that these bonds could not be sold for enough money to pay the depositors back.
Into this trouble came a great hero. The Fed was sworn to protect depositors funds from loss, so they bought the bonds from the banks and took the depositor's money into safe keeping.
No magic was required, and the depositors lived happily ever after.
