To solve the financial crisis, go to the root of it – the insecurity of homeowners’ mortgages. Secure their loans and the complex maze of financial instruments holding them will be secured.

This can be done through a federal home mortgage insurance analogous to the depositor’s insurance that helped in the Great Depression. Congress could enact reasonable guidelines for how much each would be insured for and terms of payment, then it could be administered by local banks the country through whom the mortgages originate.

The result would benefit homeowners who may otherwise lose homes and pay huge taxes to bail out large firms and stabilize the root cause of the crisis, inspire broad confidence and avoid throwing money at opaque accounting disasters.

J. Gray Cox

Bar Harbor