A prudent [man] foreseeth the evil, and hideth himself: but the simple pass on, and are punished. Proverbs 22:3
The rich ruleth over the poor, and the borrower [is] servant to the lender. Proverbs 22:7
For those who are looking at the coming economic storm. The storm clouds are all around us, and the trees are starting to reel to and fro. Yet many people think, “No, not in America.” Yes, as a nation, we have departed from our God. Our foundations are under attack. God is going to refine His Church. We are going into the fire.
The Coming Economic Storm
Do you have the faith of the Hebrew children who told King Nebuchadnezzar? See important Radio message link on coming storm.
“If it be [so], our God whom we serve is able to deliver us from the burning fiery furnace, and he will deliver [us] out of thine hand, O king. But if not, be it known unto thee, O king, that we will not serve thy gods, nor worship the golden image which thou hast set up.” Blue Letter Bible – Dan 3 (KJV)
Check out The Good Files for World Economic News Reports: New stories on technologies, banking, and global governance are included nearly every week. The landscape is changing fast, and the Storm is gathering strength.
Much like those who have had to prepare for hurricanes in the past there is much to do before the storm. Take this to the Lord in prayer. It is time to fast and seek His face in all that is coming.
Believers have hope and peace in the midst of a storm. Jesus is with us. Stop fighting the waves and call to Him. We in America have given ourselves over to prosperity.
There are those who like Balaam have sold their gifts for hire. We must have the “But if not…” clause in our faith.
Jesus said, “Peace I leave with you, my peace I give unto you: not as the world giveth, give I unto you. Let not your heart be troubled, neither let it be afraid.” John 14:27
Read the following article. We need to know that God is Holy and just. The coming trouble is not new to the Church. It has been everywhere since the birth of the church. The church in America is going to be purified, and that comes by fire. A godly friend of mine gave me a sermon which we will post soon. Called “The swelling of the Jordan”. In a nutshell, we have had it easy in America. The prophet Jeremiah had his perspective adjusted by the LORD Himself in this summary of those “in the land of peace”.
The Lord explained as follows. “If thou hast run with the footmen, and they have wearied thee, then how canst thou contend with horses? and [if] in the land of peace, [wherein] thou trustedst, [they wearied thee], then how wilt thou do in the swelling of Jordan?” Jeremiah 12: Things will get tougher, says the Lord. Read all of Jeremiah 12
I see and hear all kinds of people who promote various NWO conspiracy theories. Many outside the Church see a One World coming. Too many in the church don’t! Blind guides. Anyone who thinks they can fight this is a fool. Expose it, yes! As the Bible says in Ephesians 5:8-21
“For you were once darkness, but now [you are] light in the Lord. Walk as children of light (for the fruit of the Spirit [is] in all goodness, righteousness, and truth), finding out what is acceptable to the Lord. And have no fellowship with the unfruitful works of darkness, but rather expose [them]. For it is shameful even to speak of those things which are done by them in secret. But all things that are exposed are made manifest by the light, for whatever makes manifest is light. Therefore He says: “Awake, you who sleep, Arise from the dead, And Christ will give you light.”
See then that you walk circumspectly, not as fools but as wise, redeeming the time, because the days are evil. Therefore do not be unwise, but understand what the will of the Lord [is]. And do not be drunk with wine, in which is dissipation; but be filled with the Spirit, speaking to one another in psalms and hymns and spiritual songs, singing and making melody in your heart to the Lord, giving thanks always for all things to God the Father in the name of our Lord Jesus Christ, submitting to one another in the fear of God.”
That is about as much of a right-now word for the church. Friends, it’s not if the storm hits us; it’s when. Right now, God is gearing up His people. Recall that Fear is the beginning of wisdom; that is, a reverence for God Almighty. He does chastise His own. See the radio links attached for news that is not watered down. Links to IRN below. See also the article attached by Khouse.org
It now appears that over $20 trillion in notional value are in default. And it gets worse.
Collateralized Debt Obligations (CDOs)
SIVs led to loans being repackaged as securities. First issued in the 1980s, these became the fastest-growing sector of the asset-based synthetic securities market and are held by thousands of the world’s largest financial institutions. There are dozens of varieties which almost defy categorization:
• Collateralized Loan Obligations (CLOs) Backed by leveraged bank loans
• Structured Finance CDOs (SF CDOs) Backed by mortgage-backed securities
• Commercial Real Estate CDOs Backed by commercial real estate assets
• Collateralized Bond Obligations (CBOs) Backed primarily by corporate bonds
• Collateralized Insurance Obligations (CIOs) Backed by insurance or reinsurance contracts
• Credit Default Swaps (CDSs) $14.9 trillion to $45.5 trillion (300%) in 12 months
• CDOs backed by groups of other CDOs
Most of these bundled packages of subprime loans are now effectively worthless. They were based on the premise that markets would expand indefinitely and never contract. Their sales were completely unregulated and massively (fraudulently) overrated by the rating companies: Fitch, Moody’s, and S&P. False “Triple-A” Bond ratings were given by specialized default insurance companies: Ambac, MBIA, CIFG, and FGIC. Nine major insurers of over 80,000 corporate, municipal, and mortgage-backed bonds are also in trouble and having their own credit ratings cut.
A sampling of exposures to these “derivatives”:2
JP Morgan Chase $90.4 trillion
Bank of America $38.1 trillion
Citigroup $38.1 trillion
Wachovia $4.9 trillion
HSBC $4.4 trillion
Wells Fargo $1.5 trillion
How Much Is a “Trillion”?
It’s easy to throw words around without a grasp of their significance. Each day we find increasing tax payer liabilities being added by various “bailout” programs and other spending sprees. How much is a trillion?
• It is the sum of all the government borrowing in the history of 42 administrations: from 1776 to 2000, the first 224 years of U.S. history, a total of $1.01 trillion was borrowed.
• If you were paid $1.00 per minute, 24 hours per day, 365 days per year, it would take 2 million years to collect $1,000,000,000,000.
Derivative Exposure
The total exposure from the collapse of derivatives eludes even the experts in this field. Some of the published estimates are literally beyond our grasp and are on an equity base of less than 1%!
U.S. Government Bailouts
TARP $700 billion, and growing
Bear Stearns $29 billion
Detroit Big Three $25 billion
AIG $123 billion
Fannie and Freddie $200 billion
Mortgage-backed Securities $144 billion
FHA Rescue bill $300 billion
JPM for Lehman $87 billion
Fed’s TAF program $200 billion
Commercial paper $30 billion
Fed currency swaps $740 billion
TOTAL $2,700 billion …so far
FDIC
Many naïve investors take comfort in the fact that the Federal Deposit Insurance Corporation (FDIC) insures their bank deposits. The FDIC insures $13.3 trillion in U.S. bank deposits in 8,451 U.S. Banks. However, it had less than $35 billion in insurance funds at the end of the 3rd Quarter 2008 (down 24%). That amounts to only 76 cents for every $100 of insured deposits; less than 1%. For example, how can the FDIC participate in the GE Capital loan guarantee of $139 billion? This amounts to simple cosmetics to help defer bank runs.
A Structural Revolution in Progress
We occasionally hear the word “fascism” without really understanding its meaning: Webster’s Dictionary cites it as follows: “Any program for setting up a centralized autocratic national regime exercising the regimentation of industry, commerce, and finance, rigid censorship and forcible suppression of opposition.”3
As we watch—daily—our traditional institutions become nationalized, and we watch our politicians saddle our children and grandchildren with debts beyond any capacity to ever be repaid, we need to prayerfully reflect on the implications for our future, our liberties, our freedom of worship, and our priorities. Let Psalm 91 be your devotional commitment in these turbulent hours
Notes:
1. Michael Lewis and David Einhorn, “The End of the Financial World As We Know it,” New York Times, January 4, 2009.
2. FDIC/IRA Bank Monitor, Q1 2008.
3. Webster’s Third New International Dictionary (Unabridged).
