"We're attempting to coax a multitrillion-dollar market back to life in an extremely difficult economic and market environment and that's going to take time," the senior official said.
Today's detailed plan comes a month after the Obama administration first announced it would try to take the toxic assets off the banks' books. But the timing might be difficult.
"There is deep skepticism across the country, deep anger and outrage and frustration," Geithner said.
Because of that skepticism, he said, "We have to engender more confidence in the American people that we are going to use taxpayers' money effectively and wisely."
The public has grown weary of multibillion-dollar bailout after bailout, especially when learning about executives still buying private jets and receiving large bonuses. Last week, the nation learned that some executives at insurance giant AIG had gotten a total of $165 million in bonuses after the company gave received more than $170 billion in government bailouts to remain in business.
And today, ABC News revealed that JP Morgan is spending tens of millions on new corporate jets as well as a plush new hangar for its aircraft.
At the same time, government efforts to rein in such bonuses have made some banks and investors wary of doing business with the government.
Obama made the case for today's massive program during his appearance Sunday on "60 Minutes" when he argued that it's necessary to team up with Wall Street because there are "systemic risks" in the economy.
"There are certain institutions that are so big that if they fail, they bring a lot of other financial institutions down with them," he told "60 Minutes."
Still, there is the problem of how to value these "toxic assets" and Obama suggested on "60 Minutes" that some of them may be "completely worthless." Nevertheless, the banks holding them expect to sell them.
"The banks are going to be looking for something like 60 cents on the dollar and that the investors would only be willing to pay 30 cents," Douglas Elliott of the Brookings Institute told "Good Morning America."
Christina Romer, head of the Council of Economic Advisers, told "Good Morning America" that about 8 percent of the investment money will come from private sources, but the rest of the money to buy the toxic assets will come from taxpayers.
She emphasized that the $1 trillion program is just part of the effort to lift the economy that has included money for banks, for small businesses, for homeowners and a stimulus program to spend billions on highways, bridges and other infrastructure programs.
Administration officials said the new program was better than the two other alternatives.
Bad option No. 1: let the toxic assets stay on the banks' balance sheets, "the kind of hands-off approach that has led to other countries having financial crises that lasted years and years as opposed to months and months."
Bad option No. 2: have a single public bank buy up all the toxic assets, an approach in which "the taxpayer would take all the risk instead of sharing the risk" and that could involve the public bank overpaying for the assets.
ABCNew's Jonathan Karl and Charles Herman contributed to this report