Analysis of the Public/Private investment Plan (PPIP) in the US and Formulation of Alternative Structures for Comparative Analysis

This article focuses on one aspect of policy responses to the 2008 crisis in the US. It analyses the development and structure of the ”Public/Private Investment Plan” PPIP and ”Public/Private Investment Fund” PPIF as a means of relieving financial institutions of their troubled assets to restore liquidity in financial markets and compares with an alternative structure whereby the government would become a market maker on the troubled assets possibly traded at a refined level of granularity. The interest of the article is not limited to the topic covered, but also extends to the methodological as illustrated in the use of the concept of BICsi to address a non-trivial analytical and computational problem.