A massive leap in the values of "toxic" MBS since March - albeit from record lows - may lessen the urgency prompting the U.S. Department of the Treasury's Public-Private Investment Program (PPIP). However, it may also dampen investors' returns and increase their risk.

The Treasury chose nine fund managers to partner with July 8 and gave each of them 12 weeks - ending last week - to raise at least $500 million in capital. The government would then match their capital and provide financing to double their firepower to invest in the securities.

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