The Fed could go into the market and buy the whole S&P 500 even if the market drops by 20 percent it is not cheap. The Fed would have to borrow money or issue money but basically they can do it. It has happened before. In Hong Kong in 1997, the government came in and bought the stock market but at that time it was cheap.
Via http://drmarcfaber.blogspot.com
Via http://drmarcfaber.blogspot.com