Trouble is, at $17 million, Farmer Mac's reserves have grown far slower than the $2.5 billion in off-balance sheet guarantees, potentially leaving taxpayers on the hook if the money can not be paid.
Today, Fannie Mae has $769 billion in obligations on its balance sheet, and $896 billion in off-balance-sheet guarantees.
"We will plug this billion-pound gap by using the government's balance sheet to guarantee loans by private lenders or by co-investing public money alongside private money," he said.
Helping those who cannot afford large deposits by using the government's balance sheet to guarantee mortgages and using capital savings to offer shared equity loans on new-build for all buyers will help prevent prolonged market stagnation … However, government needs to be careful this doesn't create another housing bubble".
Today there are still roughly $90 billion of dicey loans and derivatives on the balance sheet, almost guaranteeing further writedowns unless the credit marketsmiraculouslyturn around tomorrow.
Attempts to clean up banks' balance sheets by guaranteeing or transferring toxic assets may not help if the assets that remain are also souring fast.
The point here isn't that a balance sheet leads to guaranteed financial success.
The banks at the top of many people's hit lists are Citi and Bank of America, which each have taken $45 billion in capital from the government and a combined $400 billion worth of guarantees on balance sheet assets since October.
The precise details matter less than the growing eagerness of coalition insiders to tweak Plan A.The markets also want growthFretful loyalists worry that the chancellor currently prefers "clever wheezes" to nudge the private sector into spending, involving off-balance-sheet credit guarantees and the like.
But he said the government would use the strength of its balance sheet to support investment in infrastructure, initially guaranteeing the delivery of new rolling stock for Crossrail.
Life insurers will be required to report a "realistic" balance sheet for their "with-profits" funds, taking into account guarantees promised to policyholders.
