The economy was roaring. Unemployment was low. Consumer confidence and investor confidence was high. The stock market was making gains faster than anyone thought possible, increasing by over 20 percent per year for several years in a row. People were so confident in the market that even average people borrowed money to get in on the opportunity to change their financial fortunes. Interest rates were low, but the Fed tried to mitigate the enthusiasm a bit by raising rates to the highest they had been in a while.
And then it all came crashing to a halt on a single day with the stock market falling 25% in two days. Those days may not have been the cause of the problem, but they are the symbols of a problem that would change the nation, and the world for years, to come. It is a day most everyone knows something about – along the lines of being able to say where you were on September 11, 2001, November 22, 1963, or December 7, 1941. Yes, anyone alive in October 1929, specifically on October 28, 29, and 31st will remember them well because those dates effectively announced the start of the Great Depression.
Historians disagree on the exact cause of the stock market crash and the Depression that ensued. But some of the factors I just mentioned were a part of the cause. The stock market actually peaked in early September of that year – some 8 weeks before the crash, but it wasn’t a cause for alarm. It was simply a correction, an ebb against the flows which were expected to return soon. Only the flows didn’t return. And neither did the times. A part of the Roaring 20s was due to the end of WW1, but it would take WW2, over two decades later, to fully restore the economy.
Not many people are left now who remember those years clearly. Fewer still were old enough at the time of the stock market crash to tell their story. But those stories live on in the generation or two that followed especially. And it is a story that needs to be retold, and remembered because it may be about to repeat itself.
Today’s message is not meant to be any kind of doom and gloom. It is not meant to be alarming in the sense of creating a panic, but it is meant to sound an alarm to make preparations. Some of what I will say today may sound like end times propaganda, but I do not mean it in that way. As I said last week, Jesus did not know when He was coming back, and if the Father did not tell Him, then He certainly has not told me! Yes, the Bible gives us some idea of what could be happening at that time, and some of what I will say today may align with that, but let me be clear – Paul, Peter, and others thought Jesus was going to return during their lifetime, but He didn’t. So, the lesson we can take from them is that we can expect Jesus to return soon (because He might), and if we do expect that, we need to be busy preparing ourselves, and preparing others, for that Day.
First, let me say that I am much more studied in matters of the Bible and doctrine than I am on financial matters. However, my undergrad was in Business with a concentration in Finance, and I passed multiple certifications towards being a financial advisor (I only needed to pass one more test), but I was called to ministry instead. So, I have a relatively decent understanding of the markets, and have been watching and listening and studying a lot more over the past several months (actually just over a year).
The reality is that everywhere you look, you see headlines of a world that has changed immensely over the past twenty years, the past decade, and even the past year. Some of those changes are great. Others are concerning. But the headlines keep coming and it is difficult to keep up…it is difficult to make sense of it all…and it is difficult to maintain hope. So, today, I want to touch on the financial front a bit as a means to encourage us to make plans even as we place our trust in Jesus.
Everywhere you look, you see headlines related to health concerns, war, relational issues, politics, etc.
Whether the headline is about COVID, Afghanistan, legal issues, racial tensions, political turmoil, immigration, or a whole host of other matters, these headlines fill all types of media sources and thus occupy our minds. But some, or even many, of these types of items are items may not affect us all directly, or not the same, so perhaps we dismiss some of them as less important, depending upon who we are and/or where we live. Still, these issues do matter to us, so let us consider the words of Paul to the church at Philippi. Read Philippians 4.4-7.
That may sound difficult to many. But it is possible, because rejoicing, not being anxious, and being at peace is about what we believe. And the media would have you believe one thing, but God would have you believe something entirely different. The media wants your eyes (and therefore minds) to be controlled by the headlines, but God says to think about what is true, and honorable, and just, and pure, and lovely, and commendable, and that which is excellent and worthy of praise. Those words are in the verse after the verses read above, and just saying those words brings down my blood pressure a notch or two. So, it is possible to not be caught up in the news, if we are thinking about these types of things.
Everywhere you look, you see, and you will continue to see people hurting financially. I will grant you that some people have made serious financial mistakes, but many haven’t. Many face economic challenges because of life’s circumstances, perhaps a medical condition leading to a massive bill. The effects can be devastating. For instance, consider a homeless man or woman who are separated from their children. I can’t imagine that their dream as a 13-year-old was to be homeless and disconnected from those they love. Again, the choices we make in this life have consequences that may last a lifetime, but sometimes life happens. And I can also tell you that I never had a personal finance class when I was in school (even as a Finance major in college), and if kids watch their parents, and their parents don’t know what to do, then the cycle continues generation after generation.
And it isn’t always the next generation’s fault. The deck is stacked against them. Inflation is a killer.
How do you buy what you need when what you use to pay for it is worth less and less? This situation actually encourages debt because you can pay back the loan with cheaper money later. But the problem is that the situation only continues to deteriorate and people get further and further into debt.
Of course, costs go up for a variety of reasons, but two factors have led to our current levels of inflation. Number 1, many businesses were shut down for months last year which led to a supply shortage. Demand for basic items does not decrease, and with less supply the price goes up. But the other factor is the stimulus. Some people really needed the stimulus to pay for food and shelter, but for many it was free money and people did all kinds of investing, started new projects, bought new items, etc. Well, in this case, demand for many items (like lumber) increased, and the supply went down, so the price skyrocketed.
The reality is that 30% of all the money ever printed in US History was printed within 12 months. More money leads to more purchases, but it also means the value of the dollar will decline. And that has not only affected the US, it has impacted countries around the world. In Lebanon for instance, their currency has lost 90% of its value in 18 months. Hospitals are only performing mandatory surgeries because of costs and a lack of supplies. Until this month, all citizens have been locked out of their bank accounts for many months. Now they can access $400 per month, which is a lot more in Lebanon than it is in the US. But amidst the turmoil in the country, and the shrinking value of the US dollar, that is not as much as it used to be.
Closer to home, the Venezuelan economy is crashing. And El Salvador has recently declared that Bitcoin is legal tender for currency. Paraguay may follow suit, and many other countries are considering it. Why? Because these countries are fearful that the US dollar will continue to lose value.
Incidentally, I know a lot people question digital currency, but consider your stimulus check. It was digital currency. No one brought a load of cash to the bank, let alone your house. But as government’s try to cash in on providing actual digital currencies, they will have control unlike anything they have had before.
For instance, if you use a dollar, it is tracked. The machines that count money in banks are able to read the serial numbers on the bills. This helps control counterfeit bills, but it also allows the Fed to know where its bills are. At this point, they still don’t know who has their bills, but with a digital currency controlled by a government, that would be possible. For instance, China now has a digital yuan that they control. The Chinese government is testing an expiration date on the currency, so if you don’t use it, you will lose it.
Let me back off here. Again, I am not trying to cause a panic. I am just telling you what is happening. I hope I am sounding an alarm without being overly alarming. But you need to know because amidst all of the turmoil in the world, and in our country, and among those who make policy for this country (i.e. our government), all of the fighting will lead to poor decisions (few individuals can make good decisions under increasing stress), and those decisions will impact you and me.
But it isn’t just the government, it is companies too. Shrinkage is a huge issue as companies put less in packages and make packages smaller. These types of tricks have happened for years, but they are growing more frequent. As long as the difference is small enough, and the price doesn’t change, companies can make incremental changes that add up to big profits. And that is what investors want. Companies on Wall Street don’t do what is best for the consumer, they do what is best for the shareholder. Again, these ideas are nothing new, but they are increasing in frequency and scope.
I haven’t even talked about the dangers of deflation or stagflation, which are concerning in their own way. Again, everywhere you look we have all kinds of challenges around us. And I believe these challenges are going to radically impact the next decade or so from an economic perspective. And that is why I wanted to share this message. It is not like any message I usually share. But I have been sharing some of this with the deacons over the past couple of months and said I needed an outlet, as the shepherd of this church, to let the flock know of the potential dangers lurking on the horizon.
Up to this point, I really have not given you any reason not to be anxious, so let me do so here.
But God!
In Matthew 6.25-34, Jesus says that God takes care of the birds and the fields, and if that is true, He will take care of his premier creation – mankind. Now, that does not mean that we will have all of our wants. And it does not mean that life will be easy. After all, Jesus said he had no place to lay his head. But it does mean that God cares for us and that we can trust Him.
So, how do we do that and not get bogged down by the headlines? Well, it depends upon where you look. In Matthew 6.33, Jesus said, “But seek first the kingdom of God and His righteousness and all these things will be added to you.” You might be asking what things, but that is not the point. The point is to seek God first. Seek His kingdom and righteousness first. Then, you will realize that God is caring for you in His way, in His time. And those things that are added are things like food and clothing.
So, you have a choice. Everywhere you look you can see stories about the world failing, countries in turmoil, financial markets in uncertainty, health scares, etc.
Or, following Paul exhortation in Romans 12.2 to not be conformed to the pattern of this world, you can choose something different. Then, everywhere you look, you can see God at work. You can see lives being changed and the potential for more lives to be transformed for His glory.
The question really isn’t where you look. The question is what you choose to see everywhere you look. Everywhere you look you can see what the media wants you to see or what God desires for you to see. Paul wrote that our citizenship is in heaven (Philippians 3.21), and that we should set our eyes on things above (Colossians 3.1). That does not mean that we ignore what is going on in the world; rather, it means our focus is that we focus on God to get us through the challenges and to help others do the same.
At the beginning of this message, I talked about the stock market crash and the depression that followed. But the first Depression in this country was in 1837. In that year, the frenzy wasn’t stocks, it was land, and when the market for land collapsed, our country faced its first depression. The tools that are used to measure the economy were not available then, but some estimate it may have been as bad as the Great Depression. Regardless, that was 1837. Then, we had another one 92 years later in 1929. Well, it has been 92 years since the last one. I don’t think the number 92 has any special meaning, and I am not saying that we will face another depression, but I do see signs of a significant financial change on the horizon. I see it everywhere I look. But in the midst of what I see, I must choose to seek first God and His righteousness.
As the song says, we need to turn our eyes upon Jesus and look full in His wonderful face. Then the things of earth will grow strangely dim in the light of His glory and grace.
What’s Next?:
- Consider your situation.
- Consider what is most important.
- Not everyone can make cuts, but you may want to save some extra now, if you can.
- Help others to be prepared.