It was just over a year ago that Congress was threatening to shut down the government because they couldn't agree on a budget. There was also talk about defaulting on some of USA's debt payments. The financial markets didn't like that kind of talk and the stock market started retreating.
But then at the last hour an agreement was made! The government stayed open, the stock market started shooting up and the $17 trillion deficit has never been heard from again!
So wait....how EXACTLY did all this financial fiasco get 'fixed'? Is it really fixed?
So wait...how long can a nation borrow money to run their day to day expenses?
So wait....can central bankers really just print all money they need to accomplish anything they want?
Of course any of you who have been reading my blog for more than a few months know that I have been amazed that our financial system has been able to prop itself up for as long as it has. It makes no sense to me HOW it is still standing. It makes no sense to me HOW interest rates have remained at or near 0% for these past years...the lowest interest rates EVER in the HISTORY OF THE WORLD. It makes no sense to me HOW the money schemers have convinced every Tom, Dick and Harry plus their wives to put all their money back in risky investments that are hardly paying them anything for the amount of risk they are taking.
So what's up? It's almost like God is supernaturally keeping the entire global system afloat....because it makes no logical sense that it's still standing.
Today in Rapture Ready, Todd has been observing and asking the same questions.
Last Days Financial Wonders
One of the complications of having a Supernatural Being (the God of the Bible), guiding and directing world affairs—is that occasionally—events go down a path that defies logic. Right now, we are seeing this type of divergence take place in the financial markets. It is so significant, I would call it miraculous.
What we are experiencing certainly fits the definition of a miracle: An event in the physical world that surpasses all known human or natural powers and is ascribed to a supernatural cause such as an event considered as a work of God.
The Hand of God is the only explanation for how the interlocked global economic system has for seven years now avoided a financial debacle. There has never been a time where the markets have become so ripe for calamity, and yet somehow—they hold together. We currently have a host of economic perils that have no comparison in history. Here are four that stand out:
1. Japan: The Most Hopelessly Indebted Nation on Earth
One of the best ways to measure the debt of a nation is by its obligations divided by that country’s annual economic output or GDP. According to the stats compiled by the IMF, at more than 250%, Japan has the highest debt-load of all developed nations.
The word “hopeless” can be attached to this debt based on how rapidly it is growing. But what truly makes Japan’s economic affairs unmanageable is the fact its population is in decline. After peaking at 128 million a few years back, Japan’s population is now falling, and is on a path to decline by about one million people per year.
In just 25 years, the Japanese government estimates there will be just 100 million citizens in the nation. Since Japan is now one of the oldest countries on earth, the swelling ranks of retirees over age 65 is already putting enormous pressure on the nation’s debt burden.
2. America: The Largest Debt Load by Value of Any Time
At just over $18 trillion, the U.S. has the largest debt load of any nation in history. Actually, our national debt is just part of the problem. Years of negative balance of trade has resulted in foreign nations now holding over $10 trillion of our hard currency. The feds will co-sign any loan. During the Financial Crisis of 2008, the Federal Reserve made secret loans of $16 trillion to bail out American and foreign banks. Uncle Sam has also given its guarantee to $1 trillion in student loans, $6 trillion in mortgage debt, and the $5 trillion bank money markets.
With obligations between $30 and $50 trillion, it is amazing that the U.S. dollar has retained its value. No other nation in history has been able to create so much of its national currency without suffering a collapse. Eventually, investors are going to reach a point where they lose faith in the dollar. Because the debt numbers are so massively large, instant panic is the outcome that I’m expecting to see.
3. The Lowest Interest Rates Ever Recorded
In a normal economy, low interest rates would be considered a good thing. In the world in which we currently find ourselves, low interest rates have come to represent a ticking time bomb. If rates were to rise just modestly, bond markets around the world would go into meltdown mode.
We have records for interest rates that go back over 400 years, and they’ve never been this low. It is also the worst time for rates being so low. The ones in Spain are currently around two percent, and the county is a basket case. Spain’s debt is growing at eight percent per year, it has 25 percent unemployment, and its economy is smaller than it was seven years ago. If a nation can’t service its debts at two percent, there is zero hope for it if rates were to explode.
The truly scary part is how little the rates would have to rise, to trigger a crisis in Japan. The 10 year bond in that nation is at 0.33 percent. If the interest rate was to rise above one percent, Japan’s treasury would have to print twice the nation’s annual budget just to keep the government funded.
4. The Greatest Leverage Bets (Derivatives) of All Time
The cherry bomb on the top of this pile of financial gunpowder is the derivatives market. You would think that just after experiencing a crisis triggered by derivatives, that Wall Street and Washington would long restrict their usage. In recent months, all caution has been thrown to the wind as these types of leverage bets have reached staggering new highs. Just a few weeks ago, the big banks made the government responsible for $300 trillion in derivatives.
With responsibility having been passed off to the feds, the bankers are free to be even more reckless with their derivative gambling. Since human nature is so predictable here, I have little doubt that these derivative bets will once again result in disaster.
Some people would argue that central bankers working behind the scenes are the ones keeping the financial bandwagon on the road. I find it hard to believe that mere mortals could manage a problem that has become so vastly complex.
This miraculous juggling act will have to end at some point. It’s a matter of basic math. You can’t have a nation’s debt rapidly growing forever—while its economy remains stagnant.
With the debt loads totally unmanageable, the key thing to focus on is why has this situation gone on so long. We have already set a record for the longest period in American history without a recession. As time drags on, I can only come to the conclusion that God has some special plan in the works.
One explanation that comes to mind is the Rapture. The sudden removal of millions of Christians would create its own devastating economic impact. Adding to the fuel that already exists would create a conflagration that would provide the perfect setting for the Antichrist to take charge. Since this bubble will eventually pop, our goal should be to warn others to be ready.
“Therefore, knowing the fear of the Lord, we persuade men” (2 Corinthians 5:11).
“Behold, I come quickly: blessed is he that keepeth the sayings of the prophecy of this book” (Revelation 22:7).
Here; http://www.raptureready.com/rap16.html
Wouldn't it be cool IF God was keeping it all together in preparation of the coming Rapture?
No doubt about it that people are eating and drinking, marrying and giving in marriage and just carrying on like they haven't a care in the world!!....exactly as Jesus said they would be carrying on...just like the people were in the Days of Noah before the flood came and took them all away.
