NEW YORK (MarketWatch) -- To sum up Timothy Geithner's plan in a few words, not everyone is going to live happily ever after.

The nation's new Treasury secretary unveiled a plan to stem the financial crisis through a multipronged approach that he admitted "will cost money, involve risk and take time." See full story.

"We will have to try things we've never tried before," he said. "We will make mistakes. We will go through periods in which things get worse and progress is uneven or interrupted."

Wall Street's reaction? A sinking feeling. As Geithner spelled out the plan, the Dow Jones Industrial Average DJIA, -0.47% slumped more than 200 points. The S&P 500 Index SPX, -0.48% fell almost 3%. Read more in Market Snapshot.

Geithner was right about the mistakes. He made a few on the way to today's announcement, which was delayed. By leaking parts of the plan to the media, the ultimate unveiling seemed stale.

It wasn't as if the proposals such as the government backing private investors included many fresh ideas. As RBS Greenwich Capital's Alan Ruskin noted, the leaked plan was "worryingly short on new initiatives."

But if there isn't ingenuity, there is a refreshing acknowledgement of the depths of the crisis. Geithner has recognized that the existing Troubled Asset Relief Program is too small and the only balance sheet big enough to lift up the banks is that of the Federal Reserve.

Conservatively, Geithner is talking about a $500 billion to $1 trillion "bad bank" to buy troubled assets and another $1 trillion in consumer loans. Private investors will enjoy almost a risk-free ability to trade the securities as the government guarantees a minimum price.

Again, that's not a new idea, but it does acknowledge the critical state of affairs in America's banking system.

The problem for Geithner, as it was for his predecessor, Henry Paulson, is putting a value on the securities. Critics argue that Geithner's plan could potentially make the situation worse because of a mortgage-mitigation plan the Treasury is considering. Recasting mortgage values would make it more difficult for banks to value the already illiquid mortgage assets. See full story.

It's not a guaranteed happy ending, but it is action.

-- David Weidner