US Treasury to act on toxic assets

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WASHINGTON, March 21 (AFP): The US government will unveil on Monday a three-step plan to sell toxic assets weighing down the financial system, thinking that investors will be attracted to the combination of discount prices and government assistance, The Wall Street Journal reported late Friday.
The newspaper said the plan calls for creating an entity, backed by the Federal Deposit Insurance Corporation, to purchase and hold bad loans.
In addition, the Treasury Department intends to expand a Federal Reserve facility to include older-so-called "legacy" - - assets, the report said.
Currently, it's only set up to buy newly issued securities backing all manner of consumer loans.
Third, the government is moving ahead with plans to establish public- private investment funds to purchase mortgage- backed and other securities, according to The Journal.