Monday, September 22, 2008

How to deal with the coming financial crisis

One of the very interesting things about the whole financial debacle right now is that those at the head of many of the big investment firms are Democrats. This comes as something of a surprise to me, as I'd think that those who ought to lead big, free market firms ought to be those who, you know, believe in free markets.

Of course, the solution to my confusion comes when I realize that Fannie Mae and Freddie Mac, and many companies linked to them, are not primarily free market entities, but are rather highly dependent upon government action. Who better than an advocate of governmental growth to lead them, then?

So what we have here is more or less, IMO, is you and I (with little influence in Washington) being subjected to a $700 billion debacle. What do we do about it?

Let's remember Romans 13, especially verse 8. "Owe no man anything"; think about it. All of the entities involved in this financial boondoggle owe their impact to debt.

Let's imagine the Fed's power if you remember "pay cash or drive trash." Let's imagine where Fannie Mae and Freddie Mac would be if homeowners decided to pay off their mortgages instead of upgrading to the new McMansion we know we can't really afford. Let's imagine AIG as people realize that, with adequate investments and plunging mortgage balances, they don't need as much life insurance as they thought they did.

Remember that liberty didn't start in Philadelphia, or Runnymede, Athens, or Jerusalem, or even with Moses in Egypt. It starts as we learn God's word and apply it in our lives.


GraceHead said...

AIG debacle has been in the works for a while.
Imagine you're praying over being ripped-off by an insurance company. Imagine that you have a unique gift so that God's voice often sounds audible to you, such that you can write down stuff that you hear word for word. How strange would it sound to be interrupted during your prayer to have God rant about how insurance companies are going to fail and the bigger they are the harder they will fall? Imagine again, that all of this happens years before anyone has heard of the looming financial crisis that is unfolding before our eyes. Well, as amazing as that all sounds it happened to a friend of mine, Timothy, on May 18, 2005 and it is published for anyone who is interested:

"The Giants of This World Will Fall...Stand Not in Their Shadow / Timothy, be wary of things of dishonesty and greed in nature of those in whom you have dealt. Those in whom you have dealt, greed is at the heart of that which they do. Nowhere is help or compassion found.You are a number, a mere sign of your dollar. They will fall and come to nothing. ... If I come and remove and destroy all things, which are and lead My people into vanity, what is left?...Your life and your free will to choose, to save it or lose it. Blessed are those, who lose their life in this world for My sake...they have their reward. Woe to those, who lose themselves in this world to keep their life...they are lost. Therefore, out of love, I will remove all obstacles from their path, so they may see Me clearly and run to Me, for I wait with arms open.
All must crumble, all must be shaken.
All must be removed, all foundations broken, all must be moved from their places.
All will be done as it is written, all will be divided.
All will stand naked before their Creator so they may choose...
choose life and love, My people!"

Timothy did not know what to think of this at the time, but recent news has shed light on what he was told back then.

More recently, this letter has a few more details of the collapse:

Bike Bubba said...

One could imagine that, or one could imagine simply reading the proxy statements and realizing that the company is about 97% leveraged, and saying "oo, that one could go down quick."

Would have prevented Enron, would have prevented the S&L debacle two decades ago, and it would have prevented this one.