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A central bank can create unlimited money from nothing, but that power only calms markets while people believe the bank will use it and that its money will hold value. In a panic the central banker's real tool is the market's belief in their resolve. When that trust holds, a promise can do what trillions in spending would otherwise have to do.
On August 5, 2011, Jean-Claude Trichet and his successor Mario Draghi sent Silvio Berlusconi a confidential letter listing specific fiscal and labor-market reforms Italy was expected to adopt. Days later the ECB began buying Italian and Spanish bonds to hold down their borrowing costs. The ECB had used its bond purchases as leverage to shape an elected government's policy.
In July 2012 in London, ECB President Mario Draghi said the bank would do "whatever it takes" to preserve the euro, adding "believe me, it will be enough." The bond-buying program built on that pledge, Outright Monetary Transactions, was never actually used. Yet Spanish and Italian borrowing costs fell sharply and the acute phase of the euro crisis ended. It is a clean case of a credible commitment stopping a self-fulfilling panic at almost no direct cost.
In a crisis, central bankers decide which banks survive, which governments can borrow, and who bears the losses. These are political choices about winners and losers, made by officials insulated from voters. Seeing crisis-fighting this way shows a tradeoff: independence lets them act fast and credibly, but it also concentrates power that democratic accountability was never designed to check.