This isn't going to happen, more likely there won't be enough Fed funds to cover all willing "investors". Any bank with toxic assets has every incentive to place 8% of an asset's full value in a "private investor's" hand and have him buy it from the bank with 92% Fed funds. That way the bank can unload any toxic asset onto the Fed with max 8% loss, even if the asset is currently worthless on the open market.
