Posts Tagged ‘Debt-Based Currency’

Jeroboam sacrificing to his idol, Claes Corneliszoon Moeyaert, 1641.
“Jeroboam Sacrificing to Idols” by Claes Corneliszoon Moeyaert, 1641.

And this thing was the sin of the house of Jeroboam, so as to exterminate and destroy it from the face of the earth.

  • 1 Kings 13:34

So just how is the Federal Reserve like the sin of the house of Jeroboam?  For that matter, what is the Federal Reserve and who on earth is Jeroboam and the sin of his house of which I write? 

Well, you won’t have to wait long.  Those questions, Lord willing, I aim to answer in this post.

Jeroboam and the Sin of His House

Jeroboam was the first king of Israel, the Northern Kingdom, which split from the House of David after the accession of King Rehoboam, the son of King Solomon.   The proximate cause of the split was a tax revolt of the norther tribes due to their unhappiness at Solomon’s policy of heavy taxation and the arrogant response of Rehoboam, Solomon’s successor, when Jeroboam and other representatives from the north asked him for relief.  The split of the United Kingdom into warring Northern and Southern Kingdoms is recorded for us in 1 Kings 12.

The ultimate cause of the split was the will of God.  Solomon had rebelled against God, having his heart drawn aside into idolatry by his many foreign wives, and the splitting of the kingdom was God’s punishment for Solomon’s unfaithfulness.

In 1 Kings 11, the prophet Ahijah had prophesied to Jeroboam that God he would tear the kingdom out of the hand of Solomon and give him ten tribes, leaving one for David’s successor.  The Lord even promised Jeroboam that he would build him an enduring house provided he did what was right in the Lord’s eyes.

But disbelieving God, Jeroboam quickly fell into the sin of idolatry, as had Solomon. 

In Jeroboam’s case, he was concerned that if residents of the Northern Kingdom kept going to Jerusalem to worship, their hearts would be turned from following him and return to the house of David.  To prevent this, Jeroboam invented a whole new religion.  He made two golden calves, putting one in Bethel and the other in Dan, “made priests from every class of people, who were not of the sons of Levi,” and made sacrifices at a time, “which he devised in his own heart.” 

Jeroboam was confronted by a prophet of the Lord, who in dramatic fashion denounced the king while he was in the act of sacrificing.  When Jeroboam stretched forth his hand and called for the prophet’s arrest – this was the Old Testament version of cancel culture – his hand withered, “so that he could not pull it back to himself” and the altar split in two and the ashes poured out of it. Jeroboam then asked the prophet to restore hi hand, which the prophet did. 

Now one would think that such a powerful demonstration of God’s power and anger would have moved Jeroboam to repentance.  But this did not happen.  In 1 Kings 13:33, 34 we  read, “After these event [the withering of Jeroboam’s hand and the altar splitting in two] Jeroboam did not turn from his evil way, but again he made priest from every class of people for the high places; whoever wished, he consecrated him, and he became one of the priests of the high places.  And this thin was the sin of the house of Jeroboam, so as to exterminate and destroy it from the face of the earth.”   

The Sin Didn’t Stop with Jeroboam

Jeroboam reigned as king of Israel for twenty-two years.  Scholars differ on the dates of his reign, one putting it at 922-901 BC, while another gives the dates 931-910 BC.  Samaria , later the capital of the Northern Kingdom, fell to Assyria om 722 BC, so in either case the Northern Kingdom would continue for another 179 – 188 years after Jeroboam.  But although Jeroboam was succeeded by many other kings of Israel, none of them departed from his sin of establishing a false religion in the kingdom right at the outset.  One could even say that the sin of Jeroboam was endemic to the Northern Kingdom.

You can see this from reading through the remainder of the books of 1 and 2 Kings.  A search using the term “sin of Jeroboam” on BibleGateway yielded 24 occurrences in these two books. 

  • And He will give Israel up because of the sins of Jeroboam, who sinned and made Israel to sin (1 Kings 14:16)
  • He did evil in the sight of the LORD, and walked in the way of Jeroboam, and in his sin by which he had made Israel sin (1 Kings 15:34)
  • For he walked in all the ways of Jeroboam the son of Nebat, and in his sin by which he had made Israel sin (1 Kings 16:26)
  • But Jehu took no heed to walk in the law of the LORD God of Israel with all his heart; for he did not depart from the sins of Jeroboam, who had made Israel sin (2 Kings 10:31)

“Walked in the way (or ways) of Jeroboam” also returned several results.  For example, King Ahaziah, Ahab’s son, “did evil in the sight of the LORD, and walked…in the way of  Jeroboam the son of Nebat, who had made Israel sin.” 

At no time did any of the kings who reigned in the Northern Kingdom break the pattern of the sin of the house of Jeroboam.  They all walked in his “original sin,” and the whole nation went into captivity because of it.

The Sin of the Federal Reserve

The sin of the Federal Reserve (and all other central banks) has at least one thing in common with the sin of the house of Jeroboam.  Once established by Jeroboam, his idolatrous religious system proved impossible to get rid of.  Even zealous King Jehu, the only king of the Northern Kingdom about whom God had anything good to say, could not bring himself to end the Jeroboam’s false religion.  In like fashion, the Federal Reserve, although manifestly a corrupt, unchristian, and unconstitutional system from its founding in 1913 right up to the present, has so far proven impossible so much as even to audit, let alone get rid of. 

The Federal Reserve was corrupt from the beginning.  Just as with Jeroboam’s false religion, there was no point at which the Federal Reserve (henceforth, the Fed) was not corrupt and dishonest and sinful.  According to Fed critic G. Edward Griffin in his book The Creature from Jekyll Island – I highly recommend this very readable critique of the Fed – the founding of the Fed was quite literally a conspiracy, with some of the most powerful bankers and politicians in America along with Paul M. Warburg of the Rothchild banking dynasty meeting under secretive circumstances on Jekyll Island in Georgia in November 1910 to hammer out the details of what would become the Fed.  Griffin describes this meeting as the, “birth of a banking cartel to protect its members from competition.”

Of course, that’s not how it was sold to the public. Taking pains not to use the term “central bank,” the conspirators sold the Fed – even the name Federal Reserve is a con, for the Fed is not owned by the federal government, it is a private bank owned by the Fed’s large member banks and it has no reserves apart from money it creates out of thin air in a sort of twisted version of creation ex nihilo – to the American people as a way of stabilizing the banking system which had been rocked by a major crisis in 1907.  In truth, the Fed was conceived as a  way of transferring the risk of a banking crisis from the bankers themselves to the American people, but of course the Jekyll Island crowd wasn’t about to let that cat out of the bag. 

Once established by the Federal Reserve Act, passed by Congress in 1913, the Fed set up shop and his been operating ever since.  During that time, the dollar has lost 98-99% of its purchasing power.  It’s important to note that this loss of purchasing power of the nation’s currency is not some unforeseen bug, but a feature, of the system.  The depreciating currency – and in a debt based fiat currency system such as we have in America the currency must be debased otherwise the system would collapse – is essentially a giant transmission belt that serves to strip mine purchasing power from the wages and saving of ordinary Americans and deposit that stolen wealth into the pockets of the wealthiest of the wealthy.

It should be said here that as Christians we do not criticize the wealthy because they are wealthy.  If a man become rich by honestly serving his fellow man, very well.  There is no sin in earning a lot of money.  But it’s quite another matter to steal a lot of money.  And this is what the Fed was set up to do from the very beginning. 

Just as Jeroboam’s false religion was corrupt and idolatrous from the very beginning and at no time had God’s sanction, so too is central banking – whether conducted by the Fed, the Bank of England, the European Central Bank, the Reserve Bank of Australia, or the People’s Bank of China, it matters not which one we speak of; they are all corrupt – a fraud and a curse upon the nations in which it is practiced, and this includes nearly all nations on earth. 

But there is at last another way in which the Fed is like the sin of the house of Jeroboam.  Not only was the Fed, like Jeroboam’s false religion, corrupt from the beginning, but it has persisted from presidential administration to presidential administration. 

It matters not whether the president is Republican or Democrat, conservative or liberal, a man who promises to cut the size of government or vastly expand its powers, the Fed keeps running in the background, churning out dollars with a click of the mouse.  At the present time, the Fed is committed to buying at least $120 billion (that’s right, $120 billion) per month in federal government debt and mortgage backed securities.  To put that in some perspective, Jeff Bezos, whom Forbes Magazine named the richest man in the world for the fourth consecutive year in 2021, has a fortune listed at $177 billion.  In less than two months’ time, the Fed prints another Jeff Bezos sized fortune. 

And to say the Fed prints the money really isn’t accurate.  It would be better to say that it clicks the money into existence, because all the newly created money is brought into existence on a computer.  They don’t even bother running a printing press.

But back to the notion that the Fed is much like Jeroboam’s sin.  No presidential candidate in my lifetime – with Ron Paul being the one exception – has ever seriously talked about ending the Fed. 

When Donald Trump and Hillary Clinton were running for president in 2016, Clinton criticized Trump’s comments on the Fed saying, “You should not be commenting on the Fed actions when you are either running for president or you are president.”  Clinton couched her remarks as protecting markets, but one suspects there was more to it than that.  Presidents aren’t supposed to talk about the Fed, because the Fed is supposed to be independent.  But while Fed supporters like to speak of the Fed’s independence from the political process, a more honest word to use would be “secretive.” Those who run the Fed act more as if they belonged to a secret society than public servants.  And that’s not surprising given that their labors are directly damaging to the legitimate interests of the American people.  Because of this, they must keep the hoi polloi in the dark about all their money printing schemes, the real reason for rising prices [rising prices are not inflation; inflation is Fed money printing which results in rising prices, but you’re not supposed to know that], corporate bailouts and the rise in wealth disparity. 

But even populist Donald Trump did not lay the axe to the root and call for an end to the Fed.  When Trump complained about the actions of then Fed Chairman Jent Yellen, he was upset only because he believe that the Fed was acting to help Hillary Clinton, not because Trump himself had any objection to the Fed. 

The Fed engaged in massive money printing under George W. Bush, Barak Obama, Donald Trump and is engaging in massive money printing under Joe Biden.  And not only does the Fed print massive amounts of new currency under all administrations, Democrat or Republican it doesn’t matter, but it does so at a faster and faster pace.  Indeed, because of the debt-based nature of our monetary system, cash must be borrowed into existence at a faster and faster pace to pay the growing interest on the existing debt.  It’s a bit like having tiger by the tail.  Once you grab that tail, you can’t let go.  Once you begin a debt-based financial system, which America did with the creation of the Fed, you can’t stop adding debt.  Such systems are a sort of cul-de-sac, a dead-end road to financial perdition.       

To sustain the unsustainable system of debt increasing at a faster and faster pace just to service the interest on the existing debt, central banks the world over have suppressed interest rates to near zero and even below zero.  That’s right, in today’s world of central banking, you get paid to borrow and punished to save.  This is a financial version of what Isaiah warned about, calling good evil and evil good.  This cannot continue indefinitely.

End the Fed

In his recent column “The Woke Fed,” Ron Paul wrote once again about the coming economic crisis and that the crisis would, “either be precipitated by or result in the rejection of the dollar’s world reserve currency status.”

But more disturbing than this is that Paul noted that the inevitable collapse of our current monetary system result in it being replaced, “with a government even more authoritarian than the current one.”  Paul doesn’t say so explicitly, but he’s likely referring to the creation of a new system of Central Bank Digital Currencies (CBDC’s) by which the monetary elites will hope to remain in power once the current system implodes. 

Just as Israel desperately needed to repent of its idolatry by removing the false religions system of Jeroboam, so too does the United States need to repent of our monetary sins, end the Fed and allow the free market to determine what monetary system we should have going forward.  Note well, I do not say the government should institute a system of sound money, but rather the government should get out of the way wan allow the free market to determine what money is best. 

The idea that the government should not be involved in the manufacture of money may stride some readers as odd.  After all, don’t all governments manufacture money.  Most all of the them do, or use money manufactured by other governments, but this does not mean they are right in so doing.  To say that all governments print money simply is a descriptor of what they do.  But this is not to say they ought to do it.  Only that they do it.   

According to the Bible, there are only two function os government, punish evildoers and reward the good. There’s nothing there thay says anything about printing money, or in the case of the United States, chartering a private bank, the Fed, to regulate the money. 

Just as idolatry is always wrong, so too is it always wrong for politicians and central bankers empowered by them to regulate a nation’s money supply.  The bankers and politicians will always abuse their position.  Just as idolatry is evil and cannot be reformed, so too is central banking both evil and irreformable.  For the health of the nation, both must be done away with entirely   

Let us, therefore, end the Fed.    

Read Full Post »

Your country is desolate, your cities are burned with fire; strangers devour your land in your presence; and it is desolate as overthrown by strangers. Isaiah 1:7

“…because of Western civilization’s love of material comforts, there is an unwillingness to face unpleasant realities.”

  • Gordon H. Clark, A Christian View of Men and Things, p.53

“‘How did you go bankrupt?’ Bill asked.  ‘Two ways,’ Mike said.  ‘Gradually and then suddenly.’“ So wrote Ernest Hemmingway in his novel The Sun Also Rises

Although Hemmingway’s book was a work fiction, what he said about bankruptcy is a phenomenon many of us have seen in real life.  Individuals and organizations that appear to be in robust financial health experience sudden financial collapse. 

Perhaps the poster child for sudden financial ruin is Lehman Brothers, a famous 150-year-old Wall Street investment bank.  Having earned record profits during the height of the real estate bubble from 2005-2007, early in the morning on Monday, September 15,2008, Lehman Brothers filed for bankruptcy.   

The collapse of Lehman Brothers to this day is still the largest bankruptcy in American history. 

Gradually, then suddenly.  That same pattern can be seen in the Scriptures as well.  In Deuteronomy 32:35 we read, “Their foot shall slide in due time.”   Some will recognize this as the text on which Jonathan Edwards based his famous sermon “Sinners in the Hands of an Angry God.” Wrote Edwards,

It [the saying “their foot shall slide in due time”] implies, that they were always exposed to sudden unexpected destruction.  As he that walks in slippery places is every moment liable to fall, he cannot foresee one moment whether he shall stand or fall the next; and when he does fall, he falls at once without warning: Which is also expressed in ‘Surely thou didst set them in slippery places; thou castedst them down into destruction:  How are they brought into desolation as in a moment? (Psalm 73:18-19).

Sodom and Gomorrah met with destruction in a single day. 

After centuries of rebellion against God, Jerusalem was sacked in a single day. 

In Daniel’s time, the mighty city of Babylon was overthrown in a single day. 

In Revelation, the voice from heaven prophesies that the destruction of Babylon the Great will come in a single day.  The kings of the earth are said to lament her destruction, crying out, “Alas, alas, that great city Babylon, that mighty city!  For in one hour your judgment has come” (Revelation 18:10).  

In all of these cases, the sudden final destruction was really the end result of a process that had been going on for many years.   

Read Full Post »

Financial Crisis

A prudent man foresees evil and hides himself, but the simple pass on and are punished.

Proverbs 22:3

When I began writing this series back in early August, I did so as a response to a hard selloff in the stock market that followed the Fed’s decision at the end of July to lower interest rates.  As I noted in that first post in this series, I decided on the title “The Ongoing Financial Crisis of 2008” because it is my view that the market melt down that began in earnest in the fall of that year has never really gone away.

What occurred was that central banks took money printing into hyper-drive in late 2008 and early 2009 and managed to reflate the stock market bubble that had popped earlier in 2008.  I likened their actions to what the prophet Ezekiel called plastering walls with untempered mortar.  In other words, the Fed addressed the symptoms of the financial crisis, but not the cause of the crisis itself.

Eleven years later, this is still the case.  Nothing has been fixed.  Nothing has improved.  In fact, not only have things not improved, they have gotten far worse.

The 2008 crisis, what is sometimes called the Global Financial Crisis or the GFC, was a debt crisis.  There was simply more debt in the financial system than could be repaid.  So what was the response of the Fed and the federal government?  They conspired to create even more debt to solve a crisis caused by too much debt, as if somehow more of the same thing that caused the problem in the first place was also the solution!

To borrow an English proverb, this was the financial equivalent of bringing coals to Newcastle.

If a man is an alcoholic, you don’t cure hm by giving him another bottle of whiskey.  While another bottle may make him feel better for the moment, in the long run it will kill him.  Yet this is not so very different from what governments and central banks all over the world did in 2008.  They went on a spending and money printing spree, which managed to kick the can down the road but did nothing to solve the underlying problem.

As a result, while the economies of the United States and other Western nations have appeared to recover their health, the underlying fundamentals of those economies have grown steadily worse.  Just in America, our national debt has more than doubled since 2008 and now sits at $23 trillion.

Just to give you as sense of how fast debt is now piling up, it took the federal government from the founding of our country until 1982 to compile $1 trillion in debt.  Now, even mainstream sources are predicting that the annual deficit for fiscal year 2020 – this is the federal government’s fiscal year which began on October 1, 2019 and ends on September 30, 2020 – will be in excess of $1 trillion.  In other words, the federal government is adding the same nominal amount of debt in a single year that it previously took about 200 years to accrue.

Oddly, no one in Washington seems the least bit concerned about this.  Not the Democrats.  Not the Republicans.  No one except an odd fellow here and there such as Senator Rand Paul.

The Bible teaches us that debt is a burden.  At best, it is something that is to be used prudently and paid off timely.

Yet we all live with a debt-based financial system that, not only encourages debt, but actually requires debt to increase at a faster and faster pace just to keep the system from imploding.  This debt-based system of financial perdition was put in place in the United States with the passing of the Federal Reserve Act of 1913.  The Fed has been destroying not only the financial fabric of the nation, but its moral fabric as well, for over 100 years.

What is true of America is also the case with all other Western nations.

We have become enslaved by debt, and all the more with each passing year.

But just as untempered mortar quickly shows itself when exposed to a little rain, so too are the phony fixes put in place in 2008 beginning to come unglued.  In fact, this author has been amazed by how badly the financial system has deteriorated in the past three months he has been writing this series.

In just that short time, the Fed has, apparently on a permanent basis, started baling out the overnight repo market, twice cut interest rates and resumed Quantitative Easing (QE).  These are all various forms of money printing, which have the long-run effect of weakening the dollar resulting in higher prices and a lower standard of living.

And these are just the activities they openly acknowledge.  In the opinion of this author, the Fed rigs all financial markets 24/7 to provide the appearance of normalcy.  Stocks, bonds, real estate and oil are propped up, while precious metals – gold and silver – and crypto currencies are suppressed.

Bet even as the Fed rigs all markets and the government statisticians put out phony economic numbers designed to understate unemployment and inflation while overstating economic growth, there are some stats that cannot be rigged.

If one looks closely at the economic numbers that are put out, he will see that, all the economic cheer leading from the administration aside, there is almost no good economic news to be found.  Here is just a sample of recent headlines showing just how serious things are getting:


I could easily produce many more such headlines, but I trust the reader gets the point that, economically speaking, things aren’t all that great out there.  What’s even more remarkable is that these headlines are showing up at a time when the Fed has put the money printing pedal to the metal, intervening more aggressively in the market than at any time since the height of the 2008 crisis.

But while all that money printing has, apparently, not turned around the economy, the stock market is hitting new record highs.

So which is it?  Are we to believe, the stock market, the politicians and the Wall Street cheer leaders, who tell us everything is awesome, or the economic statistics which point to an oncoming recession?

For my part, I’ll trust the economic statistics.  Not, mind you, because I think economic statistics furnish us with knowledge.  Only the 66 books of the Bible do that.  No, it’s not that economic statistics are true that causes me to trust them.  Rather, it is that the monetary and fiscal policies pursued by central banks and Western governments – that is to say, money printing and deficit spending – are morally bankrupt and will, in the long-run, inevitably lead to financial bankruptcy as well.

All this naturally leads to the question, when will the next economic crisis hit?  My answer:  I don’t know.

In my opinion, the entire world economic system should have collapsed in 2008, but extraordinary action by the world’s central banks managed to resuscitate the system.  The financial system could easily have collapsed any time since then, but for the ongoing interventions – both public and secret – of central banks and governments ever since.

In short, we’ve all been living on borrowed time.

So how much more time are the masters of the universe able, or even willing, to buy?  I don’t know.

In my opinion, the apparent quickening pace of the slide into recession seems to indicate that the time before the next major financial crisis is relatively short.  That said, this author has been amazed at the ability of the establishment to maintain order as long as they have, so I would caution against any predictions that the wheels are definitely going to come off in the short-term.  Quite obviously, the Trump administration is doing everything in its power to maintain normalcy until after the November 2020 elections, which are just under a year away.  Can they hold things together until then?  We’ll see.

But regardless of the timing, it is my thesis that a major financial crisis is coming.  This will not be a garden variety recession.  It will be like the 2008 crisis, only worse, for the simple reason that the debt crisis has gotten worse.  Instead of dealing honestly with things in 2008, all we did was double down on the debt and kicked the can down the road.

But the point is coming when the can is no longer kickable.

That’s when things will get interesting.

And that’s the reason I’ve written this series on prepping.  The bill for our debts is coming due, and I have a great burden to alert my fellow Christians to this, so that they may, as the prudent man in Proverbs 22:3, foresee trouble coming and hide themselves.


Read Full Post »

Financial Crisis

A prudent man foresees evil and hides himself, but the simple pass on and are punished.

    Proverbs 22:3

It was back in August that we began our look at the ongoing 2008 financial crisis. The immediate occasion for my writing on this topic was the sudden plunge in the US stock indices following the Federal Reserve’s decision to raise interest rates in late July. The market sold off hard, but managed to stabilize, or more accurately, was stabilized by the powers that be after a phone call by President Trump with three major bank CEO’s.

This was a similar situation to what happened around the end of the year in 2018. On December 23, the day before the Dow and S&P indices had their largest ever declines on Christmas Eve, Treasury Secretary Steve Mnuchin placed individual calls to America’s six largest banks – Brian Moynihan, Bank of America; Michael Corbat, Citi; David Solomon, Goldman Sachs; Jamie Dimon, JP Morgan Chase; James Gorman, Morgan Stanley; Tim Sloan, Wells Fargo. When the market re-opened after the Christmas break on December 26, the Dow closed up 1,086.25 points, the largest single day gain in the history of the index. This huge day was after a terrible December and in the absence of any news that would have caused a market surge.

Was there a relationship between Mnuchin’s call on December 23 and the blast off in the stock market three days later? While this can’t be formally proven, in the opinion of this author it is the most likely explanation. In short, I think that Mnuchin told these CEO’s to buy the market and that they obliged.

If my understanding is correct, this means that at least twice in the period of eight months orders came down from on high to rescue the stock markets. What, I would ask you, does this say about the state of our financial system? What are we to think of a system that requires this level of manipulation to keep from crashing?

Of course, calls from Trump and Mnuchin are not the only sort of manipulation in the financial system. In the short time that I’ve been writing this series, we’ve seen additional extraordinary measures taken by the Fed to prop up the system.

First there was the bailout of the overnight Repo market. Originally, this was to be for a few days in September. Next, they extended it to a couple weeks. Then it got pushed out to the second week of November, then it was January 2020. Just last week, Fed President James Bullard expressed his preference for a “standing repo facility.” By this he seems to mean that he wants the current repo market intervention by the Fed to become a permanent policy tool of the central bank.

And that’s not all. Last week on Wednesday, the Fed started QE4. With this latest iteration of what in 2008 was termed an “emergency policy,” the Fed will by purchasing $60 billion a month in T-Bill (T-Bills are short-term US Treasury debt instruments). Where, you ask, does the Fed get the $60 billion per month to conduct QE4? They get it by a process that, were you or I to try it, we’d be arrested. In short, they counterfeit it out of thin air.

Here’s another question you may want to ask yourself. If the economy is doing so great as we’re constantly being told by the mainstream financial press, why is the Fed running simultaneous bailouts of both the overnight repo market and the bond market, both of which are designed to prop up the stock market? The obvious answer is that, far from being the greatest economy ever, the US, and indeed the world’s, financial markets are a mess and getting messier by the day. All the hype you hear about how great the economy is doing is propaganda designed to keep you locked into the system for the benefit of those who run it.

In light of the enormous lies that are being told to the American people by government officials, by bankers, and by the press, in the opinion of this author it is imperative that God’s people hear the truth about the financial state of the country and some sound advice about how to take measures to protect themselves financially. That is the purpose of this week’s installment.


Read Full Post »

%d bloggers like this: