First and foremost, this means establishing a meaningful amount of homeowner equity. Second, it means using sound underwriting criteria to ensure that borrowers are reasonably likely to be able to repay the government-insured loan on a sustained basis.
Those infrastructures discourage speculative attacks against a well-entrenched currency because financial systems are robust and are able to withstand vigorous policy responses to such attacks. However, the institutions of the newer participants in global finance had not been tested, until recently, against the rigors of major league pitching, to use a baseball analogy.