Admittedly TALF has generated two opposite concerns: one is that our credit requirements are too conservative and unlikely to fund large volumes; the other is that the central bank is taking too much credit risk on its balance sheet. I think we have struck a good balance between these concerns.
…
At this point we see evidence that TALF is working as intended. Spreads on asset–backed securities have come down. And while much of the recent ABS issuance has been supported by TALF loans, some institutional investors are re–entering these markets without that support.
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I think this {to expand the TALF program} aggressive move was appropriate considering the many risks we were facing, the direness of some forecasts, and the uncertainty surrounding our new tools. Future developments will help us determine if our actions to date have been too much, too little, or just right.

Although it is still too early to say the TALF has been a resounding success, we at the Fed are encouraged by the results so far.

"If you compare buying Treasuries to a targeted credit program, the targeted credit program will result in probably lower interest rates in the targeted sector, but higher interest rates in the other sectors."

...

"I would have preferred a program of buying Treasuries over targeted credit programs like the Term Asset-Backed Securities Lending Facility", Lacker said. He said he would not be opposed to the purchase of long-term Treasury securities such as 10-year notes and 30-year bonds.

As reported by Bloomberg News

In another joint program, the Federal Reserve and the Treasury established the Term Asset Liability Fund, or TALF.

The Federal Reserve Act confines the System's outright asset purchases to securities issued or guaranteed by the U.S. Treasury or U.S. agencies. Even so, the Fed has the potential to use its balance sheet to restore functioning in other impaired financial markets. The recently announced Term Asset-Backed Securities Loan Facility (TALF) provides a model for doing so. This new Fed facility is designed to spur lending to meet the credit needs of households and small businesses. The facility will support the issuance of securities collateralized by auto, student, credit card, and Small Business Administration (SBA) loans—sectors where the issuance of new securities has slowed to a trickle. The high borrowing spreads on such securities, even when the underlying loans are government-guaranteed—as in the case of SBA and many student loans—suggest not only heightened credit risk but also an impairment of market liquidity which the facilities can address. The inability of financial institutions to securitize such loans, and of potential investors in such securities to borrow against them on reasonable terms, reflects an important breakdown in credit markets. By improving the functioning of markets for securitized assets, the Fed has the potential to boost private-sector credit flows in support of the economy. Under the TALF, which is a joint Federal Reserve-Treasury initiative, the Fed has agreed to provide nonrecourse loans to holders of eligible highly rated asset-backed securities. Cooperation with the Treasury is necessary because the program entails some risk of loss and, under the Federal Reserve Act, all Fed lending must be appropriately secured. The Treasury has committed $20 billion of TARP funds to protect the Fed against losses on the Fed's lending commitment of up to $200 billion.