Feeds:
Posts
Comments

Posts Tagged ‘Financial Markets’

Financial Crisis

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

    Proverbs 22:3

“How did you go bankrupt?,” Bill asked. “Two ways,” Mike said. Gradually, then suddenly.”

That line from Hemmingway’s The Sun Also Rises could, I am sure, be repeated by many who have found themselves in serious financial trouble. A man can pile up debt for years with seemingly little consequence, until suddenly it all comes crashing down. Likewise, a scam artist can go on scamming, until one day his fraud is exposed. Think about Bernie Madoff whose Ponzi scheme blew up during the 2008 financial crisis.

One can find examples of the gradually then suddenly principle in the pages of Scripture as well. Psalm 73 records the psalmist’s lament that wicked men can do what they want and never seem to suffer the consequences of the actions. That is, until he understood that God would bring them “to desolation in a moment.”

Jonathan Edwards’ famous sermon “Sinners in the Hands of an Angry God” expounds a passage in Deuteronomy which expresses much the same idea as Pslam 73. “To me belongeth vengeance, and recompence; their foot shall slide in due time: for the day of their calamity is at hand, and the things that shall come upon them make haste.” In his exposition of Deuteronomy 32:35, Edwards wrote, “It implies that they [unbelievers] were always exposed to sudden unexpected destruction. As he that walks in slippery places is every moment liable to fall; he can’t foresee one moment whether he shall stand or fall the next; and when he does fall, he falls at once, without warning.”

Gradually, then suddenly. Was that not also the case with the men in Noah’s day? They were marrying and giving in marriage. Yet all the while they were adding to their sins, until, as Jesus said, the flood came and took them all away. They never saw it coming.

Much the same can be said of the Canaanites. It was told to Abraham in his day the iniquity of the Amorites was not yet fulfilled. That is, God would judge them, but not yet. Some four hundred plus years later, destruction cane swiftly. Gradually, then suddenly.

Or consider what happened to Israel once the nation was settled in Canaan. Despite God’s sending prophets to warn, gradually the people became more and more corrupt, until suddenly they were carried away into captivity. The Northern kingdom in 722 BC when Samaria was taken by the Assyrians, the southern in 586 BC with the fall of Jerusalem to Babylon.

Gradually, then suddenly. These ideas can be applied to America in our own day. A nation born out of the Protestant Reformation has gradually forgotten its roots, has gradually turned away from the source of its strength. And what are we to say about such a nation? What will be its end? If the Bible, and even secular history, are any guide, unless the Lord grants many repentance, quite obviously it is headed for a fall. Likely a sudden one at that.

But a sudden fall for America, if in fact it comes, and the West more generally, does not mean that American Christians or Christians in other Western nations have no defense and no hope. We shall look at this further in a few moments. But before we begin our discussion of practical pointers for Christian preppers, I would like to point out a couple of noteworthy announcements last week relative to the financial markets.

(more…)

Read Full Post »

Financial Crisis

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

    Proverbs 22:3

In Part 8 of this series, we began formulating a Biblical theory of prepping. In Parts 4-7, we had looked at some examples of prepping in Scripture. While the examples of Noah, Lot and Joseph clearly establish that God approves of prepping, it seemed good to me to begin to articulate some of Christian prepping’s main components with an eye to defining the term.

In last week’s post, I closed by asking the question, For whom do we prep?, and answered, in part, that we prep for ourselves. It may seem strange to say that we prep for ourselves. After all, isn’t that just obvious? Not necessarily. The unchristian idea of altruism has so tainted many Christians’ thinking that some believers think that it is somehow sinful to think of their own interests. But although it is common to hear Christians deny they have a self interest, this is not a position consistent with the Scriptures.

Today, I’d like to continue, and hopefully conclude our discussion of the Biblical theory of prepping by exploring the other parties for whom Christians prep apart from themselves. But before we do that, I’d like to briefly review the financial news from last week.

When I began this series a couple of months ago, the stock market was recovering from a serious downturn in early August that was, apparently a reaction to the Fed’s decision to lower interest rates and the inversion of the Treasury yield curve. The Plunge Protection Team (PPT), apparently, saved the day once again, pushing the major stock indices out of correction territory. But even though the stock market has been stabilized and, at least on the surface, things seem normal, there are abundant signs that all is not well on Wall Street.

Just last week (September 29 – October 5), there were more signs of major problems in America’s economy. First, as MarketWatch reports, the Chicago Purchasing Managers’ Index (PMI) dropped in September for the third time in four months. The expected number was 50, but the index reported 47.1 in September. So what does all that mean? When it comes to the PMI, any reading above 50 means the economy is expanding, any reading below 50 indicates economic contraction. Not only did the September number come in well below expected, but it actually was the worst reading since 2009, around the time of the last financial crisis.

Second, the ongoing “repo madness.” Not only has the Fed been bailing out the overnight repo market to the tune of $75 billion every night, but last week pledged to continue the bailout. Originally, the Fed was going to supply funds to the repo market just for a few days. This was then extended to October 10. Friday, the New York Fed announced that it will “continue to boost liquidity in money markets [the repo market] into November.” Fund manager Dave Kranzler said of the repo operations that they will eventually morph into outright money printing. With every extension of the Fed’s repo market intervention, Kranzler’s evaluation comes closer and closer to being realized.

Third, the chances of a Fed interest rate cut in October are going up. The reason behind this seems to be the previously mentioned bad September PMI reading, which was not limited to just the US, but extended to other industrialized economies as well. Please keep in mind, the Fed cuts rates when it sees economic activity slowing down, either in an attempt to prevent a recession or to pull the economy out of one. If the US economy were really as strong as the Trump Administration would like people to believe, they would not at the same time be pushing the Fed to lower interest rates.

Fourth, layoffs. As was widely reported last week, Hewlett-Packard (HP) announced that it plans to cut its workforce by up to 16% and expects to cut between 7,000 and 9,000 jobs from its global workforce of 55,000. Kroger, America’s biggest grocer, announced plans to lay off hundreds of workers last week, as question arose about its turnaround plan.

In summary, last’s weeks economic news provided further evidence that the US and world economies are slowing down. It has been in anticipation of a significant economic shock that I undertook to write this series on prepping several weeks ago. Let us now continue to look at what the Bible says about prepping.

(more…)

Read Full Post »

Financial CrisisTrump touts ‘strongest economy in the world’ after disappointing jobs report,” ran a recent headline that managed to capture both the official line of the Trump administration and the contrasting reality portrayed by many recent underlying economic data points.

The February 2019 jobs report, released in early March, was expected to show a gain of 190,000 jobs, but instead reflected a gain of only 20,000. That’s a big miss in anybody’s book.

Now one could argue that President Trump’s statement is not negated by the disappointing jobs report. The US could indeed have the strongest economy in the world – depending on how one defines “strong” – and still do a face plant when it comes to the production of new jobs. All that is required for these two ideas to be true at the same time is for the rest of the world to be in a bigger mess than the US.

It is the contention, however, of this author that, in spite of all the talk of a booming economy coming from the Administration and from various sources on Wall Street and in the media, the US economy is not doing well and, in fact, is very likely headed into recession. It may actually be in recession as of this writing. Below are thirteen reasons why this author thinks so.

(more…)

Read Full Post »

%d bloggers like this: