Wednesday, January 28, 2009

Trust in God and not in Mammon


"...the money has failed." (Genesis 47:15)

In response to the dream that God gave to Joseph, Joseph providently stockpiled real assets during the seven years of good seasons, so that during the seven years of famine, Joseph could trade when the money failed.

We have been living in a short period of history that has seen an experiment. The experiment was invented by John Maynard Keynes. In this experiment, covetousness has driven the supply of money. An important aspect of Keynes experiment has been Fractional Reserve Banking. Under the Fractional reserve Banking system, banks create credit out of nothing, they lend this credit, and write the loans as an asset to the bank. On the basis of these digital assets, a small fraction is held in reserve, but the larger portion is re-loaned, and the new loan is written up as an asset to the bank. This process of fractional reserve and re-lending is done over and over until the bank has lent many times over the credit that was initially created.

The borrowers then take this credit and repay using money that has been earned working, and repay with interest over and above the original loan. As the principal is returned to the bank, the initial loan is erased from the bank's computers, and the interest is stored as profit. The banks, with this profit, then purchase real assets (such as gold, real estate, and so on) and stockpile these assets in good times in anticipation of bad times. Sometimes the banks themselves get greedy and their realisable assets are minuscule against the multiplied loans that they hold on their databases; so that when the money fails (and people in large numbers default in their payments), the banks collapse because they have insufficient assets to convert to money to meet their obligations.

The Scriptures say, "Owe no man anything" (Romans 13:8). In the Proverbs debt is equated with slavery and improvidence is identified with foolishness.

In our day, Fractional Reserve Banking, and leveraged investing has failed, and is failing and will fail. The covetous-driven debt financing system is unravelling. Have we been provident in the good times? Have we purchased real assets that can be cashed in and converted to food and other essentials during the lean times? Have we avoided debt, and so are not directly caught up in the failure?

The money has failed, and the suffering of the greedy and improvident has begun. We will see many lose their jobs over the next several years, and those who are caught in the web of debt will suffer as they are stripped of mortgaged assets, and banks will suffer as defaults on loans increase. Sadly, many church communities will also suffer because they have bought into the covetousness by taking out loans for building projects. Within the congregations, members have taken out loans through credit cards, car loans, house mortgages, and loans for luxuries such as holidays. As things get tighter for these families, their capacity to support the church property loan evaporates; which then places enormous pressure on the church leadership who bear the responsibility of the building and other loans in the face of declining support.

God does not bless sin. It is a sin for us to pray for God to bless sin. Covetousness is sin. If we find ourselves in debt we must repent; stop being covetous, make it a priority to pay down and off the debts we have, and live within the means that God provides for us, saving by converting a portion (at least ten percent) of all income into convertible assets (such as gold and silver coins, gold and silver bars, unencumbered real estate, and so on).

Trusting in God is walking in obedience to His commandments. Those who have obeyed His commandments in regards to covetousness and debt will be much less affected by the next several years than those who have lived in the sin of covetousness and debt. May God bless the obedient righteous. May He discipline the disobedient and draw them back to Himself through repentance and may He remove the stubbornly wicked from the face of the earth.

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