It is complicated. It is untested. And at $200 billion, the government's latest attempt to shore up the crumbling economy is anything but cheap.

The announcement yesterday that the Federal Reserve would generate up to $1 trillion in consumer loans by creating a $200 billion fund to buy asset-backed securities was met with an increasingly common reaction these days: caution and skepticism.

In theory, the Term Asset-Backed Securities Loan Facility (TALF) would persuade banks and other lenders to give new loans to consumers, businesses, homeowners, commercial real estate investors - you name it.

How? The government would take existing loans off lenders' books by buying them up as packaged securities. Lenders then would feel more comfortable issuing new loans.

And since loans help people buy things, the hope is it would contribute to an economic recovery.

But there is no guarantee that the latest effort, to be spearheaded with disbursements by the Federal Reserve Bank of New York beginning March 25 and concluding at year's end, will truly lead to more consumer loans or would pull shoppers out of their shells.

And if it does, the benefits will not emerge for months, said Guy LaBas, chief economist at Janney Montgomery Scott, the Philadelphia-based brokerage firm. "Markets haven't responded very well" to the program's launch, LaBas said. "There are also some very critical questions about whether it can be implemented successfully."

Although the U.S. Treasury Department yesterday played up its latest maneuver as a benefit to "businesses and households," LaBas said banks would more likely avoid issuing many new loans for cars or household goods.

Rather, he said, financial institutions that dump batches of their existing loans into the TALF fund may be more inclined to float new residential and commercial mortgages.

That's because land assets can appreciate in value, rather than automatically depreciate, which cars and washing machines do.

Plus, shoppers are so frightened by the deepening recession that they need more than the lure of a loan to plunge into buying.

"The truth is consumers are concerned about job losses and declining incomes," LaBas said. "They're not going to be buying cars. I think where the TALF is going to be more supportive isn't the autos necessarily, but the housing markets."

If he's right, TALF may offer little relief for the battered U.S. automotive industry, which took another hit.

Sales at General Motors, Toyota, Ford and Chrysler fell 40 percent or more last month compared with February 2008, according to figures released yesterday.

Dealers say plummeting sales have little to do with the availability of car loans, which they said were being written every day for people with reasonably good credit.

"That's the small percentage of the problem," said Michael Kennedy, who owns six dealerships for Ford, Mazda and other makes under the John Kennedy banner.

"The big problem with car sales today," he said, is "consumer confidence. People just have their padlocks on their wallets because they're afraid of what the future holds."

Fred Beans, who owns several local dealerships under his name, said new consumer loans were a "good thing." But the greatest threat to dealers is that lenders are refusing to finance their inventories.

Without a multimillion-dollar credit line to buy new and used cars and hold them on the lot until they sell, a dealer's franchise dissolves.

And there is no sign that the lenders who have been pulling credit lines will have a change of heart, even with TALF on the horizon.

"I have 1,600 employees," said Beans. "That could put a guy like me out of business."