IAP 2018: US Gov’t: Lender/Insurer of First, Last or All Resorts?

This January, Doug Criscitello taught a new, for-credit class on the role of the U.S. government as a financial institution. The course touched on the history of government involvement in the credit marketplace, the economic rationale for credit intervention, and the many ways the U.S. government functions as a lender and insurer, focusing primarily on the areas of housing, higher education, and business.

What: U.S. Government: Lender/Insurer of First, Last or All Resorts? (15.S62)
When: January 17 & 18, 2018 from 1:00pm to 4:00pm
Where: GCFP Conference Room (E70-1370)

Day 1 -  Historical perspective: Government involvement in credit marketplace

• Why do governments intervene in the private credit markets?
  • Economic rationale for government credit support
• How did US government become world’s largest financial institution?
  • Key counter-cyclical role during/after financial crisis
  • Credit & insurance
• How do governments operate as lenders/insurers?
  • Managerial challenges
    • Cost of capital, pricing/budgetary cost
    • Continuum of government subsidization options
    • Need to measure/assess outcomes and impacts, not simple impacts
  • Business opportunities arising from government credit programs
    • Origination & Funding (including securitization activities)
    • Servicing
    • Regulatory Compliance
    • Consulting

Day 2 - US government credit assistance in 3 sectors

• US housing policy at a crossroads
  • Fannie/Freddie, Ginnie Mae, FHA, flood insurance
• Higher education
  • Student loans, from private to public model
• Business
  • Small business assistance
  • Export and overseas investment credit
  • Clean energy programs
  • Infrastructure development proposals
  • Pension insurance