Everyone got excited about the "novel" approach the Fed is considering to conduct sterilized asset purchases. The story written by the WSJ (Jon Hilsenrath):
WSJ: ... in the new novel approach, the Fed could print money to buy long-term bonds, but restrict how investors and banks use that money by employing new market tools they have designed to better manage cash sloshing around in the financial system. This is known as "sterilized" QE.Mr. Hilsenrath was probably still in school when the Fed put in place this "novel" approach in 2009. The central bank set up arrangements for tr-party repo with multiple institutions. This was designed to safely lend securities to a broader number of institutions, some of whom may not have stellar credits.
The idea is that the Fed purchases securities in the market and then lends them out via repo. Legally the Fed is borrowing cash from dealers and posting the newly purchased securities as collateral. When the dealers sell securities to the Fed, they receive cash, increasing the amount of dollars in the system. By borrowing that cash via repo, the Fed is sweeping it back out of the system. That's called "sterilized purchases" and there is nothing "novel" about it.
For more information on Mr. Hilsenrath's "novel" approach, see this 2009 Sober Look post.