The announcements came fast and furious this weekend from government agencies willing to support Fannie Mae and Freddie Mac should the housing crisis grow even worse.

“Fannie Mae and Freddie Mac play a central role in our housing finance system and must continue to do so in their current form as shareholder-owned companies,” U.S. Treasury Secretary Henry Paulson reassured investors and markets in a written statement released this weekend. “Their support for the housing market is particularly important as we work through the current housing correction.”

Fannie and Freddie currently hold or guarantee more than $5 trillion dollars worth of the $12 trillion worth of American residential mortgage debt outstanding, according to the Office of Federal Housing Enterprise Oversight. As housing values have sunk, many have begun to worry that the loans held or guaranteed by the GSE’s are worth more than the homes themselves, causing concern about whether Fannie and Freddie are adequately capitalized to absorb such losses.

Paulson on Sunday announced the federal government’s plan to address such concerns. Fannie and Freddie have long enjoyed lower borrowing rates and other financial benefits because of their real and implied backing by the U.S. government, but this weekend’s announcements make this support more explicit in an effort to calm investors on Wall Street and homeowners on Main Street. “GSE debt is held by financial institutions around the world,” Paulson noted. “Its continued strength is important to maintaining confidence and stability in our financial system and our financial markets.”

To do this, the U.S. Treasury has temporarily increased Fannie and Freddie’s line of credit with Treasury.  The Cabinet-level department will also be allowed to invest in the GSEs if needed, providing them with the access to capital necessary to support the U.S. housing finance market by purchasing and bundling mortgages.

The Federal Reserve has also stepped up, expanding the GSEs’ borrowing ability through the Federal Reserve Bank of New York, “should such lending prove necessary.”

Regulation of Fannie and Freddie will also be strengthened, with Federal Reserve involvement in the creation of a new regulator and regulatory process, especially regarding capital requirements.  (OFHEO maintains that the two firms are adequately capitalized with $95 billion in total capital, but investors remain skittish.)

However, the government’s assurances only went so far on Monday, with stocks down at the end of the day after an early morning uptick.

“The market opened with a sigh of relief. But upon reflection, we realized that the government’s plan doesn’t quell our concerns about the economy,” Arthur Hogan, an analyst at Jefferies & Company, told the New York Times, which noted that “Freddie Mac and Fannie Mae ‘own or guarantee half the mortgages in the country — but the half that they own aren’t the scary ones,’ Mr. Hogan said. ‘They’re the most conservative: they can’t lend for second homes, they can’t lend for multiple properties. They’re the good guys and we’ve always known the government would rescue them.’”

Alison Rice is senior editor, online, at BUILDER magazine.