Emergency Economic Stabilization Act of 2008 --market mechanisms

The bailout bill is pretty terse on the details of market design: here's the relevant section of H.R.1424, part b,SEC. 113. MINIMIZATION OF LONG-TERM COSTS AND MAXIMIZATION OF BENEFITS FOR TAXPAYERS

"(b) Use of Market Mechanisms- In making purchases under this Act , the Secretary shall--
(1) make such purchases at the lowest price that the Secretary determines to be consistent with the purposes of this Act ; and
(2) maximize the efficiency of the use of taxpayer resources by using market mechanisms, including auctions or reverse auctions, where appropriate.
(c) Direct Purchases- If the Secretary determines that use of a market mechanism under subsection (b) is not feasible or appropriate, and the purposes of the Act are best met through direct purchases from an individual financial institution, the Secretary shall pursue additional measures to ensure that prices paid for assets are reasonable and reflect the underlying value of the asset."

HT to Guhan Subramanian