Can ETFs Solve the Toxic Asset Problem?

Toxic debt has been a huge problem for some time now. Can exchange traded funds (ETFs) provide the answers?

Bob Pisani at CNBC notes on his Trader Talk blog that we do have some solution in place: the Public-Private Investment Program (PPIP) will help investors buy these assets. But retail investors are shut out on that one.

Bring in ETFs. There are two in particular:

• The Stahl Plan
• A plan from provider PowerShares

Matt Hougan at IndexUniverse has the full rundown on what these plans would entail.

Incidentally, PowerShares has filed to launch two new ETFs: The Prime Non-Agency RMBS Opportunity Fund and The Alt-A Non-Agency RMBS Opportunity Fund. Only problem? They wouldn’t buy toxic assets.