Mar. 24--WASHNGTON -- The Obama administration's long-awaited plan to help banks dispose of so-called "toxic assets" so they can resume lending was greeted Monday with a huge rally on Wall Street, but its longer-term success remains far from certain.

Treasury Secretary Timothy Geithner detailed a public-private partnership to spend $75 billion to $100 billion in taxpayer money to help raise up to $1 trillion to snap up distressed mortgage bonds and other assets that are now shunned by investors and crippling the financial system.

"I'm very confident this scheme dominates all the alternatives," Geithner said shortly before the 9:30 a.m. opening bell for trading on the New York Stock Exchange.

Markets rallied. The Dow Jones Industrial Average closed up 497.48 points, or 6.8 percent, at 7775.86. The S&P 500 finished up 54.38 points, or 7.1 percent, at 822.92. The Nasdaq rallied 98.50 points, or 6.8 percent, to close at 1555.77.

As the past 14 months of recession have made painfully clear, however, a one-day stock rally doesn't mean the worst is over. Geithner's plan remains fraught with uncertainty over whether it'll work.

The potential for huge gains attracted big names such as Pacific Investment Management Co., of Newport Beach, Calif., the world's largest bond trader. The company said "count me in" within hours of the Geithner plan's unveiling.

"From PIMCO's perspective, we are intrigued by the potential double-digit returns," founder Bill Gross said in a statement. He said that banks, investors and taxpayers could all gain. "This is perhaps the first win/win/win policy to be put on the table and it should be welcomed enthusiastically."

If the investments lose value, however, taxpayers will share the losses, perhaps disproportionately.

"The value of cheap multi-year government financing is quite significant, as is the government's promise to put a floor under losses at 10 percent or 20 percent of what the investor puts up. It is possible that these incentives will cause investors to overpay for the assets, with most of the eventual losses flowing to the taxpayer because of the downside protection offered the investors," wrote Douglas Elliott, a research fellow at the Brookings Institution, a center-left research organization in Washington.

"For example, it could be rational for investors to offer 40 cents on the dollar, calculating that they would benefit sharply if the price went to 50 cents, while the government would absorb most of the losses if the value fell to 30 cents on the dollar," Elliott wrote.