To say that the financial crisis era has been riddled with half-truths, distortions, and outright falsehoods regarding the unprecedented public policies designed to maintain stable, liquid credit markets and help stimulate the U.S. economy, would be an understatement. Moreover, investors need to disabuse themselves of them if they hope to make informed, balanced, and prudent investment decisions.

One such misnomer concerns the categorization of quantitative easing.

As U.S. Federal Reserve Chairman Ben Bernanke took pains to clarify Sunday, during his CBS '60 Minutes' interview, the Fed is most certainly not 'printing money.'

A monetary policy of printing money would involve adding money to the financial system that chases the same amount of goods. That can and typically does lead to higher inflation.

Finally, some common sense and accountability-oriented reforms with regard to the nation's infamous asset-backed securities market? Perhaps.

On Tuesday, the Federal Deposit Insurance Corporation (FDIC) voted 3-2 to require ABS sellers to keep 5% of the credit risk in exchange for a guarantee against seizure, The Associated Press reported Tuesday. The theory behind it is that banks with the 5% exposure will be more careful about originating mortgages/loans, etc.

What is TALF? Term Asset-backed Securities Loan Facility (TALF) is a new $200 billion dollar lending program created by the Federal Reserve.

What does it do? Under the program, the Fed would offer low-cost loans to any U.S. company investing in securitized loans. The asset-backed securities include pools of credit card receivables, automobile loans, and student loans.

Who can participate? Any U.S. company can participate, including hedge funds but excluding offshore funds.

Why did the Fed do this? There are two main reasons behind the Fed's decision. First, even with all the money the Fed has been funneling to the banks by buying government securities, it still is not enough to get things moving. Bank balance sheets are still too constrained. Second, banks have frozen most of their lending except for low-risk customers, and even then the rates on these loans are too high.

What is the benefit of the program? Through this program the Fed hopes to get more loans written at lower rates and bring down the cost of borrowing.

The Fed has now created a new role for itself, that of loan broker, a new and heretofore untried strategy.

Ever since the Super SIV (structured investment vehicles) story broke last week, I've been seeing hints that mutual fund shareholders might be caught up in the mess and not even know it. Well it's true. I've found significant holdings in non-government backed collateralized mortgage and asset-back securities in a number of mutual funds. That means if you have a mutual fund with a security that does default, that mutual fund will have to write-down those assets and may have to lower the Net Asset Value (NAV, essentially the selling price) of your mutual fund.

I've found significant holdings in various types of bond funds, including Total Return Bond Funds, Short-Term Bond Funds and Ultra-Short Bond Funds. There are thousands of funds out there, so I can't guarantee I've located all the funds with possible problems, but I can tell you what to look for in any funds you hold.

If your funds hold primarily bonds graded lower than AAA, it's worth a closer look. Next, look at the mortgage and credit holdings of the fund. If your fund holds a significant amount of mortgage pass throughs, collateralized mortgage obligations (CMOs), commercial mortgage-backed securities (CMBS) or asset-back securities (ABS), these could be the types of securities that are now tied up in the Super SIV story. In order to know whether or not you have a problem, you would need to look at the actual portfolio holdings and find out exactly what is being held.