Stocks plunged around the world Monday amid growing doubts about how strong a global economic recovery will be. But apparently there’s a big contrarian investor out there that’s still pretty bullish: China.

According to reports, China’s sovereign wealth fund is eyeing an investment in the U.S. government’s oft-maligned Public-Private Investment Plan.

That program, known as PPIP, was set up earlier this year as a way for private investors to cooperate with the government to bid for soured home loans and mortgage-backed securities held by banks. The China Investment Corporation (CIC) is said to be interested in purchasing $2 billion of such assets.

The possibility of China being involved in the PPIP could be a huge endorsement for the program, which has been criticized by many for taking a long time to actually start.

When PPIP was unveiled in March, influential bond fund manager Bill Gross of Pimco declared it a “win-win-win.” But it has turned out to be more of a a “wait-wait-wait.”

Pimco, which was widely expected to be named by the Treasury Department as one of the managers of PPIP, pulled its application to be a manager in June. The firm cited uncertainties about the program as its reason it was no longer interested. Treasury finally selected nine firms to manage PPIP in early July.

“PPIP has been a disappointment from a timing standpoint. It’s a work in progress and the lack of momentum has been frustrating,” said Frank Barkocy, director of research with Mendon Capital Advisors, a firm that invests primarily in financial stocks. “But given the might of China, it would be encouraging if we could get a player of that size and magnitude stepping to bid for some of these toxic assets. It would be a psychological plus.”

If the CIC does actually decide to participate in PPIP, it could be viewed as yet another sign of confidence in the U.S. economy. China has continued to be a big investor in the United States throughout this painful downturn.

The Treasury Department reported Monday that China remained the largest foreign owner of U.S. Treasury securities, with $776.4 billion in holdings as of the end of June. While that’s down a bit from the $801.5 billion China owned as of the end of May, it’s still 45% higher than China’s Treasury holdings a year ago.

Still, it’s one thing to buy mostly safe U.S. Treasuries. It’s another thing to start venturing into toxic mortgage assets.

Jim Glassman, senior economist with JPMorgan Chase, said that the possible involvement of China in PPIP, coupled with the fact that its holdings in Treasurys dipped a bit in June, could be a sign that China is even more bullish on the prospects of a bounceback than previously thought — and that could have a big impact on other investors.

“If you believe in a global recovery, there are lots of other investments you could buy. But if China is interested in moving more into riskier assets, that could be a positive,” Glassman said. “It is symbolizing renewed confidence. If more buyers are willing to take on risky assets, there could be a ripple effect.”