Details For Toxic Asset Plan On The Way

The Obama administration has developed a detailed plan for removing toxic mortgage-backed securities from the nation's banks and financial institutions and may unveil it early next week.

The plan expands on the idea of public-private partnerships that Treasury Secretary Timothy Geithner introduced in February when he unveiled the administration's financial stability plan.

Then, investors were disappointed by the lack of detail. Now, sources say, the plan will be three-pronged and involve the Treasury, the Federal Reserve and the Federal Deposit Insurance Corp., along with private investors.

The government will put up the vast majority of about a trillion dollars to buy toxic assets. But the funds will be largely in the form of loans and not require further appropriations, which Congress is in no mood to give.

In addition, the Treasury will hire private management firms to buy up toxic assets, with both sides putting in equal amounts of equity, but with taxpayers shouldering most of the risk.

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