Sharing your Steam account if very dangerous since they will have full access to your library, inventory & any saved payment options. So Steam wouldn't be complete able to tell if you or your friend is breaking the rules or purchasing stuff with your money.
Family Sharing is the safer option. While you'll need to log into the computer to authorize the computer & the users to access your account, it allows your friend to access your game library while you're not playing (or offline) without the risk of them compromising your account.
The one major downside to Family Sharing is that only one person can access your game library at any given time & MUST be online to access your library. If you're sharing your library with a few people (as Family Sharing allows you to authorize up to 10 PC's & 5 users), one person who wants to play a game in your library can knock another person off (who may be playing an entirely different game) with little warning. Steam does give shared users a 5 minute warning before they get kicked out of their game (so they can either purchase the game & continue playing OR save & get off safely). As the account holder, you have ultimate rights to your library... so you always have access to the games & nobody can kick you off.
These restrictions are in accordance to the EULA's & Fair Use Policy of copyright law (as you purchased only one copy of the game for your account & you're sharing the entire account).
IMPORTANT NOTICE: Make sure you only grant Family Sharing access to those who you fully trust! The actions of the users within the games you're sharing with them will be reflected on your account as well. If one of those persons break the rules or get VAC banned, your account (as you're the person sharing the game) will be imposed with the same penalties as well. This may cause Family Sharing to be revoked on your account as well, depending on the severity of the infraction. Do NOT share your library with those who you do not fully trust as a family member.
Please visit
http://store.steampowered.com/promotion/familysharing for more information.