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Discussion Forum : Articles and Sermons : America Asks For A King

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rookie
Member



Joined: 2003/6/3
Posts: 4790


 Re:

I found this discussion of our nation's current usury system revealing....


http://www.financialsense.com/Experts/2008/Taylor.html

Do you see how men use debt to change the scales and weights established by God?

In Christ
Jeff


_________________
Jeff Marshalek

 2008/11/29 9:17Profile









 Re:

Greetings in the Lord's name!

Quote:

Brother Jeff wrote:
Listen to the [i]consequences or curses brought on Israel [u]because they did not obey the voice of the Lord[/u][/i]...I that time the nation is now known as Iraq.

Deu 28:43 "The alien who [is] among you shall rise higher and higher above you, and you shall come down lower and lower.

Deu 28:44 He shall lend to you, but you shall not lend to him; he shall be the head, and you shall be the tail.

Deu 28:45 "Moreover [i]all these curses shall come upon you and pursue and overtake you, [u]until you are destroyed[/u], because you did not obey the voice of the LORD your God[/i], [i]to [u]keep His commandments and His statutes[/u] which He commanded you.[/i]

Are we willing to acknowledge that our financial system is against God's economy and therefore a device of Satan.



Brother, yes, this financial system is against God's economy and a "device of Satan", but [i]is it not also doing His will, is it not executing His righteous judgment upon America?[/i] If the church in America and the American people were obedient to the voice of the Lord, if they had feared Him, this indebtedness would not have come upon them, but because the church--and the nation--has strayed from the prescribed path, [b]God[/b] has sent this [u]curse[/u] upon her, just as He did with Israel. Until she is destroyed. "... all these curses shall come upon you and pursue and overtake you, until you are destroyed ..."

Notice that the people of God (which is not equivalent to the righteous [i]and[/i] the wicked, but the chosen ones) are the recipients of judgment--they have brought it upon their nation with their disobedience, they and not the stranger and the heathen. Here is a couple of examples from Scripture:

Quote:
Jdg 3:12 [i]And the children of Israel again did evil in the sight of the Lord. So the Lord strengthened Eglon king of Moab against Israel, because they had done evil in the sight of the Lord.[/i]
Jdg 3:13 Then he gathered to himself the people of Ammon and Amalek, went and defeated Israel, and took possession of the City of Palms.
Jdg 3:14 [b]So the children of Israel served Eglon king of Moab eighteen years[/b].
Jdg 3:15 [i]But when the children of Israel cried out to the Lord, the Lord raised up a deliverer for them[/i]: Ehud the son of Gera, the Benjamite, a left-handed man. By him the children of Israel sent tribute to Eglon king of Moab.

Lam 2:16 All your enemies have opened their mouth against you; They hiss and gnash their teeth. They say, "We have swallowed her up! Surely this is the day we have waited for; We have found it, we have seen it!"
Lam 2:17 [b]The Lord has done what He purposed; He has fulfilled His word Which He commanded in days of old. He has thrown down and has not pitied, And He has caused an enemy to rejoice over you; He has exalted the horn of your adversaries.[/b]



So, brethren, I believe that the ultimate judgment cannot be evaded or withdrawn or mitigated unless the American church awakes from its slumber, repents of its wickedness and turns to the Living God. And the curse [b]should[/b] come upon her (the nation), because it is the [b]righteous[/b] judgment of God. In fact, many a Christian's blindness toward what is going on is a part of God's judgment! Satan is given power to "pursue" and "overtake" and to "destroy". I am reminded of the following passage now:

Quote:
Isa 5:3 "And now, O inhabitants of Jerusalem and men of Judah, Judge, please, between Me and My vineyard.
Isa 5:4 What more could have been done to My vineyard That I have not done in it? Why then, when I expected it to bring forth good grapes, Did it bring forth wild grapes?
Isa 5:5 And now, please let Me tell you what I will do to My vineyard: [b]I will take away its hedge[/b], and it shall be burned; And break down its wall, and it shall be trampled down.
Isa 5:6 I will lay it waste; It shall not be pruned or dug, But there shall come up briers and thorns. I will also command the clouds That they rain no rain on it."



If we as Christians try to "fight Satan" or "resist the authorities" or "heal the system" or restore "the America of the Founding Fathers," I believe that then we are in actuality fighting against the will of the Lord. We are saying that His judgment upon us and our land is unjust. We are going about it the wrong way. For we, in and of ourselves, can't restore anything. See this confession in the Book of Daniel:

Quote:
Dan 9:13 As it is written in the Law of Moses, all this disaster has come upon us; [i]yet we have not made our prayer before the Lord our God, [b]that[/b] we might turn from our iniquities and understand Your truth.[/i]
Dan 9:14 Therefore the Lord has kept the disaster in mind, and brought it upon us; [b]for the Lord our God is righteous in all the works which He does[/b], though we have not obeyed His voice.



America has surely become an abomination in God's sight with the filth and drunkenness it has spread among the nations (its ungodly movies, its preemptive wars, its usury, its economy of exploitation, its pornography, and its false gospels)! That is why I believe He will judge her and is calling His people out of her (to dissociate themselves from what Babylon is, even physically), while there is time:

Quote:
Rev 18:4 And I heard another voice from heaven saying, "[i]Come out of her, my people[/i], lest you [i]share in her sins[/i], and lest you [i]receive of her plagues[/i].
Rev 18:5 For her sins have reached to heaven, and [b]God has remembered her iniquities[/b].



And this is not true for America only, but also for most countries of the modern world, which have become "drunk with the wine of her fornication." Interestingly, drunkenness is associated with the inability to think clearly, drunk people are often unaware of how drunk they truly are.

I know of brothers and sisters who have "left the world" and formed secluded communities in recent years, just as the Anabaptists did centuries ago (of which some remain until this day). But for myself and my brothers and sisters I can say that we are very, very late given the signs of the times, and that if the Lord doesn't grant us time and opportunity for a safe escape and establishment in the wilderness, we may have to suffer greatly because of our tardiness when the persecution and disaster strikes. Which suffering should not be troubling but joyful for me, had I not in fact wasted a lot of time in hesitation and doublemindedness and thus incurred it.

 2008/11/30 4:54
rookie
Member



Joined: 2003/6/3
Posts: 4790


 Re:

Brother Slavyan wrote:


Quote:
If the church in America and the American people were obedient to the voice of the Lord, if they had feared Him, this indebtedness would not have come upon them, but because the church--and the nation--has strayed from the prescribed path, God has sent this curse upon her



Since 2001, it seems like everything that has taken place has more resembled the "curse" rather than the "blessing" explained in the book of Deuteronomy.


Quote:
n fact, many a Christian's blindness toward what is going on is a part of God's judgment! Satan is given power to "pursue" and "overtake" and to "destroy". I am reminded of the following passage now:



2 Th 2:

9 The coming of the lawless one is according to the working of Satan, with all power, signs, and lying wonders, 10 and with all unrighteous deception among those who perish, because they did not receive the love of the truth, that they might be saved. 11 And for this reason God will send them strong delusion, that they should believe the lie, 12 that they all may be condemned who did not believe the truth but had pleasure in unrighteousness.


They were unwilling hear... and thus "receive the love of the truth."


Quote:
And this is not true for America only, but also for most countries of the modern world, which have become "drunk with the wine of her fornication." Interestingly, drunkenness is associated with the inability to think clearly, drunk people are often unaware of how drunk they truly are.



Only the Word of God can bring light into the darkness of our ignorance.

God Bless you Slavyan...

In Christ
Jeff


_________________
Jeff Marshalek

 2008/11/30 17:14Profile
rookie
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Joined: 2003/6/3
Posts: 4790


 Re:

Revelation 3:
17 Because you say, “I am rich, have become wealthy, and have need of nothing’—and do not know that you are wretched, miserable, poor, blind, and naked— 18 I counsel you to buy from Me gold refined in the fire, that you may be rich; and white garments, that you may be clothed, that the shame of your nakedness may not be revealed; and anoint your eyes with eye salve, that you may see.

This church was wealthy by the world's standards...yet what does Jesus say?

"and do not know that you are wretched, miserable, poor, blind, and naked..."


What is Christ's solution...

18 I counsel you to buy from Me gold refined in the fire, that you may be rich; and white garments, that you may be clothed, that the shame of your nakedness may not be revealed; and anoint your eyes with eye salve, that you may see.

There are three aspects of this healing....

Does Christ's prescription (exhortation) cure the man in the three ways Satan temps man?

1John 2:16 For all that is in the world—the lust of the flesh, the lust of the eyes, and the pride of life—is not of the Father but is of the world.

And finally...for those who do not repent...are these not the ones who receive the mark of the beast?

In terms of numerology, 7 means complete. The number 6 stands for man who is incomplete. If a man seeks to be complete by seeking "all that is in the world--the lust of the flesh, the lust of the eyes, and the pride of life", he will never find completion as God's creation. So in the three ways that man succumbs to the temptations of Satan he finds that he is perfectly incomplete....666.

In Christ
Jeff


_________________
Jeff Marshalek

 2008/11/30 17:31Profile
rookie
Member



Joined: 2003/6/3
Posts: 4790


 Re:

Pro 20:23 Diverse weights [are] an abomination to the LORD, And dishonest scales [are] not good.

A system based on usury enables the princes of this world to use diverse weights and dishonest scales. The current financial crisis was created by 'manufacturing" mortgage backed securities and credit default swaps without any thought of risk or moral hazard. Those who created this market made billions of dollars in fees.

These same princes, who outwardly profess their "full faith in free market principles," are standing in line to receive handouts that will restore their financial integrity. These men are trying to overcome what Scripture says...

Pro 20:21 An inheritance gained hastily at the beginning Will not be blessed at the end.

These men are being made perfectly incomplete as they receive the mark of the beast....666.

In Christ
Jeff


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Jeff Marshalek

 2008/12/1 12:57Profile
rookie
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Joined: 2003/6/3
Posts: 4790


 Re:

Pro 20:21 An inheritance gained hastily at the beginning Will not be blessed at the end.

Since the fall of our financial system the price of commodities have dropped in half. Just think of all the money that pension funds, hedge funds, and mutual funds invested in futures contracts that disappeared.

But what is more important, just think of all the poor whose faces were being grinded into the dirt by the money changers. Think about all the poor who had to pay over 4 dollars a gallon for gas so that they could go to work. Think about the 3 to 4 dollar a gallon price of home heating oil that the elderly had to pay recently....

Now that the prices of gasoline and home heating oil have dropped more than 50 percent, who was responsible for the "higher prices?"

The moneychangers....

Jam 5:1 Come now, you rich, weep and howl for your miseries that are coming upon you!

Jam 5:2 Your riches are corrupted, and your garments are moth-eaten.

Jam 5:3 Your gold and silver are corroded, and their corrosion will be a witness against you and will eat your flesh like fire. You have heaped up treasure in the last days.

Jam 5:4 Indeed the wages of the laborers who mowed your fields, which you kept back by fraud, cry out; and the cries of the reapers have reached the ears of the Lord of Sabaoth. [fn]

Jam 5:5 You have lived on the earth in pleasure and luxury; you have fattened your hearts as [fn] in a day of slaughter.

Jam 5:6 You have condemned, you have murdered the just; he does not resist you.

As it was before in James' day, so it is today, are we those who seek to "an inheritance gained hastily?" Those who 'buy and sell' knowing that they contribute to the grinding of the poor will find that their hope "will not be blessed at the end."

In Christ
Jeff


_________________
Jeff Marshalek

 2008/12/4 8:23Profile
rookie
Member



Joined: 2003/6/3
Posts: 4790


 Re:

This article is long but it may explain man's system that is incomplete according to God's ways.

CREDIT CRISIS - THE WORST IS YET TO COME
Financial System Upside Down
by Alar Tamming, Tavex and Dr. Krassimir Petrov,
Prince Sultan University
December 8, 2008



Mark Twain once said that “if you don’t read the newspaper, you are uniformed. If you do read the newspaper, you are misinformed”. It is no surprise then, even to people who don’t follow the news, that a truly serious financial crisis is sweeping the world.

The headlines of newspapers and internet portals speak for themselves. Readers are inundated with facts about what is taking place. At one moment, bank write-offs to the extent of trillions are being discussed. The next moment, notice is given of guardian-angel intervention by governments and interest rate cuts by central banks. Aid packages in the trillions exceed the calculation skills and comprehension capabilities of ordinary people by a factor of several times. The main message conveyed by all of this “information” is mostly emotional. While write-offs may lead the reader to pessimism – what will become of my life, the government creates a feeling of security with the aura of a paternal figure, adding trillions of dollars to banks and “guaranteeing” that bank deposits and security holdings won't simply vanish. Those geniuses are on the task and will never let the system collapse, the reader thinks, so he turns his attention to the next page of the paper.

What is missing is a deep analysis of the causes of the crisis, as well as possible future scenarios – papers look neither in the distant past, nor in the distant future. The cause of the financial crisis is claimed to be driven by two emotions - fear and greed; blame goes to poor regulations and greedy Wall Street investment bankers; rhetorically is added the fact that crises accompany capitalism, that they have regularly occurred in the past, and that they will continue to occur in the future. Some stock broker releases investment advice that from a long-run perspective, now is a good time to buy stocks.

Unfortunately, investing in stock markets is never as simple as it sounds. If every time we buy when stocks are down and afterwards stocks go up, then we would be all fabulously wealthy. Naturally, it is forgotten that this is accompanied by inflation and a drop in the purchasing power of money. Moreover, the fact that the world’s largest companies and banks can go bankrupt is never mentioned in financial publications; neither is the possibility that the assets of shareholders could be completely wiped out. Bankruptcies of large companies and banks are regarded only as a theoretical possibility and relegated to the pages of abstract economics textbooks.

Fundamental Causes of the Crisis

But let’s start at the beginning, with the question of why the current financial crisis has occurred. The reasons are quite fundamental, not fear and greed, nor a lack of faith in the markets. The problems are not caused by loose regulations either. The crisis also has nothing to do with herd instinct, which helps along, of course, in the deepening of the crisis. These are, after all, only symptoms of the underlying problems.

To gain a better understanding, one must first take a look at history. Unfortunately, from inside the system, it is difficult to view the system as a whole; all that is visible are individual problems and attempts to fix them, instead of understanding that perhaps the entire system is basically built on flawed and shaky basis, that the foundation of out global monetary system is built on sand and the current financial crisis and the resulting economic crisis are objectively inevitable.

The current attempts by the government are, above all, a desire to preserve the status quo, a desire to sustain the unsustainable, a desire to extend the life of a pathological system doomed to failure from the beginning. But governments have always set the goal for themselves of preserving the system. An exception would have been Gorbachev’s declaration, were he to have announced that the socialist system is destined for destruction and should be replaced by a capitalist system. Also excepted are central bank press releases, where it is announced that the current financial system is fundamentally wrong. As stated – inside the system it is impossible to see the system’s faults.

The main fault in the current system is that monetary historical experience is largely ignored. Throughout history, all successful monetary systems have, in one way or another, been tied either to gold, silver, or some other real asset of intrinsic value. If money has been only a piece of paper or a piece of copper, the system has always collapsed.

Beginning in 1971, for the first time in the history of global finance, no currency in the world has been backed by anything. This monetary experience should be properly called an experiment, which is now reaching its logical conclusion. This includes some curious facts, such as the Estonian kroon, which is backed by a reserve currency, primarily the Euro, while at the same time the Euro itself is backed by nothing. And the Estonian Kroon is not backed by euro banknotes, but instead, in all likelihood, is backed by a mixture of German, US, and Japanese treasury bills. These are only government promises to pay that will, at the end of the crisis, make Estonia’s entire foreign reserves, gathered for bad times, almost worthless.

If money is backed by nothing more than government seals, decorated paper, and strongly voiced promises, greed enters into play. No army in history has hindered central bankers and governments from creating money out of thin air and then spending it according to their own vision. The modern term for this is credit money, the loaning of credit by the central bank that becomes money itself. In normal and stable systems, bankers have only been able to loan out money that they have in their own vaults, and they were also always ready to exchange issued paper money and obligations for the gold bars stored in the vault of the bank. However, there has come a moment when bankers realised that people were not coming back to request gold, the result of which was that worthless pieces of paper (read: banknotes and electronic impulses) were placed into circulation and if they issued supplementary paper currency, which lacked any coverage, nothing happened, at least initially. In the old days, the mess would eventually surface and the matter ended with either the bankruptcy of the bank or the destruction of the state’s monetary system through hyperinflation.

Currently, the entire monetary system is global, and therefore has lasted longer than usual. The process, which took place in Germany in the 1920’s over a period of 3-4 years, will last for 3-4 decades on the global market. Throughout history there has been no monetary system that was not backed by a precious metal or some other equivalent accepted by all, ever, without exception, that has remained standing. The current experiment cannot remain standing either. We have created financial “capital” in a heretofore unseen extent. This “capital” is incorrectly believed to be wealth, because it could be exchanged for actual wealth during certain historical stages. Unfortunately, all this financial “capital” and all of this financial “wealth” have little backing in real goods or productive assets. This is an inherent property of our modern-day fractional-reserve banking system. Te result is that, whether we want it or not, the entire global financial system will fall into chaos and will destroyed, and hopefully a new and better system will be created.

What will happen is another important question, and impulse psychology comes into play here. People have a tendency to view things, above all, with a short-term time horizon. This “short-termism” can be seen on the stock markets and by the developments in the financial world. Even though the crisis had already been predicted at the end of the 1990’s, financial analysts were guided by “mystical” numbers and assessed the condition of the current situation as good. This type of analysis reminds of the anecdote where a man falls out of a skyscraper; when asked by someone from the fifth floor window how things are going, he answers “so far so good, I’m simply moving quickly”.

The Initial Phase – Financial Crisis

Unfortunately, the depth and length of the crisis are currently being discounted. At the moment, the crisis is in its initial phases. What is taking place only has affected mostly the financial sector; there has been only a minimal effect on the real economy. However, at the latest by next year, the second phase of the crisis will begin, with spillover effects into the economy. In 2009, the weakness of the global economy will become central.

The current economic system is built on providing loans in ever increasing amounts, not on saving and the repayment of debt over time. If a private person builds his life on a series of new loans, where he repays old debt with new debt, then he would be considered crazy and would inevitably end up either in debtor's prison or bankruptcy. If the same thing were to take place at the corporate and state level, then nobody would dare say anything. It would be considered perfectly normal. Where is the child from the fairytale who wasn’t afraid to cry out that the king was naked!

Companies have become accustomed to taking new loans, although the financial system is attempting to correct. A contraction of bank credit to the private sector is in place, and inevitably the economy will not receive the money (read: credit) that it was planning on receiving. In addition, financial companies are unable to sell financial securities to finance themselves, since even the currently successful companies that kept free funds in shares and securities in order to earn a higher return, have lost over half of their value.

This first initial phase is well familiar to us. We have lived with it for almost two years. The media has called it by various names: “The Subprime Crisis”, “The Credit Crunch”, and “The Credit Crisis”.

The Second Phase – Economic Crisis

The lack of money becomes evident in the second phase of the crisis – the financial crisis is replaced by an economic crisis, triggering massive bankruptcies that would spread globally in a chain reaction. After the series of initial difficulties encountered by home borrowers and the construction companies, there have been no bankruptcies so far in manufacturing, shipping, media, food processing, not to mention luxury goods like luxury cars, yachts and watches, or exotic businesses like space tourism. But their time will come. During the second phase of the crisis, another large sum of capital will “evaporate” from the market, because a company which is going bankrupt will leave nothing for shareholders and very little for its bondholders. In the second stage of the crisis, unemployment will begin to grow along with the wave of bankruptcies. The final quarter of 2008 is only the beginning. Remember that in 1931-1932, the unemployment rate in the USA was 20%, with one in five people unemployed.

The Third Phase – Hyperinflation

Throughout the series of crises, politicians will attempt to interfere in the game, but the third stage of the crisis will nevertheless begin. Since banks were “saved” with large bailouts, politicians will also begin to lavish corporations with various aid packages. The recent charade of automakers begging for money is only the beginning. Thus, measures will be undertaken that, in the opinion of politicians, will help the economy and save jobs, something that will likely become known as Obama’s “New New Deal”. This will include a multitude of spending programs and, above all, the loaning of credit with astronomical increases in the money supply, together with the classifying of the corresponding numbers into the trillions. Just like now nobody talks any more in terms of millions, so in the not so distant future no one will be talking any more in terms of billions. Trillions will be the order of the day. Perhaps bank lending standards will be relaxed. Perhaps the government will lavish the banks with a lot more money than it does today, just to keep them lending. Perhaps the central bank will directly monetize private debt. Perhaps the government will guarantee many more corporate loans, just like it recently guaranteed the securities/loans of the GSEs. Perhaps GSEs will proliferate throughout the economy, transforming the U.S economy into the “GSE Economy”, transforming a former great capitalist economy into a modern-day nationalsozialistische economy. Perhaps the government will implement all of the above.

It will seem for awhile that peace has arrived, that the crisis has been overcome, as if the bankrupt companies have been “saved”, although this will only be the calm before the storm. If there is already more money in the financial system than actual goods, then after the subsequent injections of money, more like dropping money from helicopters or showering corporations with money, the economic ship will begin to heel.

In this stage, the third stage, the hyperinflation scenario will begin when people realize that the money in banks will buy them next month half as much as it did this month. Then panic will ensue. People will begin to buy essential and non-essential items, just as long as there is something of value that can be obtained in exchange for their colourful pieces of worthless paper. Manufacturing enterprises would no longer want to sell goods, because the money received in exchange for the sale of their goods is not sufficient to purchase the new raw materials. Everyone who sells an actual object or good for paper money is a loser, since the same money is no longer enough to purchase again the same goods. Money created out of thin air electronically has brought tremendous benefits to the initial users and issuers, but at the expense of the wider masses through the collapse in their standards of living in this stage.

The third phase will be chaotic and difficult. The details are difficult to predict, but if history is any judge, the politicians won’t be asleep. They will likely pass a number of important laws, prices will be fixed, wages will be standardized, foreign currency accounts will be frozen; in general, everything that could be done, will be done, and this will only serve to extend the agony. Social upheaval and riots will be suppressed by brute force; many democratic freedoms and values will likely be lost. As of today, the hyperinflation spiral and Zimbabwe Syndrome have reached the point of no return.

Final Phase – Monetary Collapse

In the event that democracy survives, then the fourth and final phase will begin, a phase which can be called The Darkness before Dawn, the final agony before the rising of the sun. This is the ultimate destruction of the monetary and financial system, the loss of all electronic and financial values that is accompanied by monetary reform throughout most of the world.

In the worst case scenario, this will result in the creation of a Global Government; in the best case scenario, the process will take place separately in each country. For example, at the end of the Tulip Mania of the 17th century, all futures transactions with which tulips were bought and sold for millions of florins were declared void. Similarly, all electronic assets, contracts, securities, and futures contracts will be declared void, because the world doesn’t have a court or executive power which is capable of enforcing bankruptcies and debt collection resulting from millions of non-performing contracts. Only the actual collateral for loans will be demanded - land, houses, apartments. The losers will be private persons, while legal entities, along with their debts and non-existent collateral, will be lost in the virtual world, the place from whence they came.

Things will begin again with a clean slate. We will once again all be on an equal level. Railroads and planes, bridges and houses won’t disappear. All real wealth will remain, lost is only the paper wealth, those things that people believed they had and that they believed someone else (read: government, banks, pension funds, etc) will preserve for them. At that moment, faith will truly have been lost, as the fruits of a person’s life will have, through several metamorphoses, been transformed into banking sector profits and executive bonuses that had been spent by the suits long before the crisis even began.

The new economic system will be different than the current one. Its type, shape, or form is impossible to predict at the moment. Similarly to the end of the slave-holding system, it was not possible to see the creation of the feudal system. It was also impossible to foresee the blossoming of capitalism before the industrial revolution in England in 1785. So, it now is impossible to predict all the changes, although those changes are inevitable. Each process must go through its historical development and must reach its natural conclusion.

History shows that every changeover from one organisation of society to another has been very painful. Nevertheless, each following step, no matter how painful, has moved humanity forward and offered a better life to more people. Hopefully it will also go forward this time. All we have to do is hang on.

...............................................

If this is a picture of things to come, one could see a further push to establish Babylon...

In Christ
Jeff


_________________
Jeff Marshalek

 2008/12/9 8:23Profile
rookie
Member



Joined: 2003/6/3
Posts: 4790


 Re:

Here is a simpler explaination of the foundation on which the world builds it's financial system...



In Madoff We Trust
by Peter Schiff, Euro Pacific Capital | December 17, 2008
Print
As the multi-billion dollar Ponzi scheme orchestrated by Wall Street insider Bernard Madoff unravels in the media spotlight, the nation is being presented with a rare opportunity to understand the true nature of many of our most cherished financial structures. Hopefully we have the wisdom to connect the dots.

Although the $50 billion loss engineered by Madoff is truly a staggering accomplishment (and was done using old-fashioned fraud rather than the mathematical wizardry that has characterized Wall Street’s recent larcenies) the size of the scheme pales in comparison to the multi-trillion dollar Ponzi structures run by the United States government. In fact, rather than looking to jail Madoff, President-elect Obama should consider making him our new Treasury Secretary. If not that, at least make him the czar of something!

Madoff’s inspiration came from Charles Ponzi, the Italian-born American immigrant who promoted an investment plan in the early 1900s’ that traded postal coupons. Rather than paying investors from legitimate investment returns, Ponzi hit upon the innovative idea of paying out early investors with money collected from new investors. By creating an illusion of success, interest in his investment plan ballooned. Over time the schemes have become known by many other names, such as chain letters or pyramid schemes. They are united by the fact that they always fail in the end.

When the influx of new investors inevitably slows to the point where distributions to current investors can no longer be maintained, investors look to withdraw funds. When this happens, the entire structure falls apart. The profits received by those who “invested” early as well as any funds skimmed off by the promoter, are offset by all the losses of those who came late to the party.

To a large extent, the same concept has driven the major asset bubbles of the last decade. Given the ridiculously high valuations seen by tech stocks and real estate during their respective booms, the only way the bubbles could be perpetuated was if newer “investors” could be found to pay even more outrageous prices (the greater fool). But when these new buyers balked, the whole structure crumbled. Although there was no Ponzi or Madoff to orchestrate these manias, the entire financial and economic apparatus of the country had successfully convinced the public that “investments” in tech stocks and condominiums were bullet proof and that the supply of new buyers was endless.

Unfortunately, the Ponzi economy doesn’t stop there. A chain letter is no more viable when run by governments than when run by private citizens. However, government orchestrated pyramids have the advantage of required participation. As a result, they can maintain the illusion of viability for several generations. But the longer such schemes operate the larger will be the losses when they ultimately collapse.

The Social Security Administration runs its “trust funds” with precisely the same methods used by Madoff and Ponzi. As money is collected by from current workers, the funds are then dispersed to those already receiving benefits. None of the funds collected are actually invested, so no investment returns are ever generated. Those currently paying into the system are expected to receive their returns based on the “contribution” made by future workers. This is the classic definition of a Ponzi scheme. The only difference is that Ponzi didn’t own a printing press.

The United States Government runs its own balance sheet based on the Ponzi principal as well. Our national debt always grows and never shrinks. As existing debt matures, proceeds are repaid by issuing new debt. Interest payments on existing debt are also made by selling new debt to investors. The whole scheme depends on an ever growing supply of new lenders, or the willingness of existing lenders, to continue to roll over maturing notes. Of course, as was the case with Madoff, if enough of our creditors want their money back, the music stops playing.

In Madoff’s case, the rug pulling was provided by the huge financial losses suffered by some of his clients in other non-Madoff investments. When enough of these clients looked to sell some of their apparently well-performing Madoff assets to help offset such losses, the scam collapsed. The same thing could befall the United States Government. Now that China and our other creditors are looking to spend some of their U.S. Treasury holdings to stimulate their own economies, look for a similar outcome with even more dire implications.

The main difference is that while Madoff took elaborate steps to conceal his scheme, the U.S. government operates in broad daylight. It truly is amazing how faith in government is so pervasive that many can believe that politicians will succeed where private individuals fail, and that governments are somehow immune to the economic laws that govern the rest of society. Like those unfortunate to have been duped by Madoff and Ponzi, the world is in for a rude awakening.

...............................................

Man's system is based on deluding the masses of men. The princes of this world are working feverishly to restore confidence in this system.

In Christ
Jeff




_________________
Jeff Marshalek

 2008/12/17 12:39Profile





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