One of the important truths we need to understand as Marketplace leaders is that we need to give a faith response in times of crisis and evil to people who might be feeling and thinking that God is angry with them or does not love them and is not concerned with their work or vocation. How can a loving God allow the financial markets to crash and destroy my business? How can a loving God allow my job to be taken away? How can he allow my house and car to be repossessed? These are internal questions in the hearts of many people who become victims of such economic crisis. What should be our response to them when they ask such questions? Think about being Job’s friend in the book of Job, at a time where He had just lost everything, his children, livestock, precious possessions. What made things even worse was having his wife echoing words like “why don’t you just curse God and die” whether she was wrong or right it does not matter..As a couple they both had internal questions that needed to be addressed by friends like you and me.
1 Peter 3:15 But in your hearts revere Christ as Lord. Always be prepared to give an answer to everyone who asks you to give the reason for the hope that you have. But do this with gentleness and respect, 16 keeping a clear conscience, so that those who speak maliciously against your good behavior in Christ may be ashamed of their slander.
This passage clearly puts so much responsibility on us to give answers to those who might be asking questions about the existence of God in times of crisis. Some might feel that God is dead, retired from the workplace or just does not care about their work. I remember that when the Global recession occurred I was also laid off from my job at Nedbank Exchange Controls…I felt so bad and angry! I had a lot of questions….little did I know that such an event would change my whole life and usher me right into my passion and purpose…LCBN Africa was founded in December 2009, A call to resource marketplace leaders was birthed. ( http://www.mahlobofoundation.com )
It is key to also understand that this is a pattern of economic crashes occurring every seven years dating back to the Great Depression. The Great Depression suffered its worst year in 1931, then later we have the Arab Oil Embargo, the S&L crisis, Black Monday, the 1994 Bond Massacre, the 2001 NASDAQ crash, and the 2008 Financial Collapse. Each occurred at the very end of a 7-year economic cycle.
This seven year cycle also lines up with the 7 and 49 year cycles of land rest and jubilee debt forgiveness that God commanded the Israelites. The super cycle, the 49-year cycle ends . This is called the Schmita Cycle.It is the “cycle of cycles” that economists have been looking for. We are on the verge of the greatest depression in history, and with it the most opportunity to profit for those who would have invested in Gold. The market usually crash, wipe out equities, and the bond market. Banks close for weeks. No withdrawals at ATMs and this accompany liquidation. Then a devaluing of currency…whether you call it deflation or depression, yes that what it is.
1. Economies of nations are not only controlled by market forces but by spiritual forces
For centuries, we have seen the battle of ideas between Economist Keynes and Economist Friedrich Von Hayek’s, Keynes argues that economies of nations are a complete unit or system, and must be centrally planned; government must control all major sectors/ industries and all resources must be used for common good for all…while Hayek argues that economies of nations are depended on market forces of Demand and Supply; Government should have less interference on what happens in Wall street or JSE, Key industries should be privatised and competition must be promoted. Well we have seen both thinking in action both in Russia and America.
Over the decades Hayek’s ideas of a Free Market oriented society spread out through Margaret Thatcher- Britain and Ronald Reegan – USA , it set the tone for Less government control on heavy weight industries and lot of privatisation of state owned business…which most countries adopted later, these was further passed on to Bill Clinton, Gorge W Bush and Barack Obama…We saw a deregulation of the financial industry which gave the Banks and Wall street so much influence on the economy of America and world. This went against the words of Thomas Jefferson
“I believe that banking institutions are more dangerous to our liberties than standing armies. If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around the banks will deprive the people of all property until their children wake up homeless on the continent their fathers conquered. The issuing power should be taken from the banks and restored to the people, to whom it properly belongs.” Thomas Jefferson 3rd president of US (1743 – 1826)
While all of this might be partly true, It is important to understand that we live in the world that is controlled by spiritual forces, Ephesians 6:12 For our struggle is not against flesh and blood, but against the rulers, against the authorities, against the powers of this dark world and against the spiritual forces of evil in the heavenly realms. 2Corinth 10:3 For though we live in the world, we do not wage war as the world does. 4 The weapons we fight with are not the weapons of the world. On the contrary, they have divine power to demolish strongholds. 5 We demolish arguments and every pretension that sets itself up against the knowledge of God, and we take captive every thought to make it obedient to Christ.
The passage above gives us a clear understanding that our warfare is against spiritual forces, there is a battle waged over every sphere of society, one of those sphere is the business or economic sector. There are strongholds over nations, while we may think that certain economic issues, challenges and crisis are as a result of market forces: demand and supply, that might not be the case, we are dealing with something more bigger than that..it is a battle for culture. When we lose influence we lose the culture and when we lose the culture we lose the sphere of society. It is left at the hands of the unrighteous and ungodly
We need to transform the business/ economic sphere through the gospel of the kingdom, most of the crisis that happened in history God knew about it long before it took place. He takes each and everyone of us through a process of transformation and change so that we can be His Change Agents that will provide kingdom solutions and answers to the hopeless world. Joseph emerged in a time of economic crisis in Egypt. He became one of the best ruler and Prime Minister, his Kingdom economic policies saved the Egyptians and so many nations. He won the battle for culture . He was entrusted with the whole economic system of Egypt to bring reforms and change to it. Can God entrust you with a solution for this coming economic crisis?
2. A shadow system, shadow politics, shadow economics , shadow history and shadow financial activities caused the economic meltdown….A cry for a Kingdom system!
It’s the ‘shadow financial system’ that has created the current crisis that we’re in. The shadow financial system consists of non-bank financial institutions that, like banks, borrow short, and in liquid forms, and lend or invest long in less liquid assets. They are able to do this via the use of credit derivative instruments. The system includes SIVs (Structured Investment Vehicles), money market funds, monolines, investment banks, hedge funds and other non-bank financial institutions. These are subject to market risk, credit risk and particularly liquidity risk.
Even Barack Obama in his campaign speech on the 28th September 2008 said ” The era of greed and irresponsibility in Wall street and Washington has led us to a financial crisis so serious than in the depression period” He mentioned that greed in Government and Wall Street; Deregulation of the Financial industry were a major reason for the Global crisis; and was prepared to bring change and reform in the financial industry should He be elected as President of America’
When finally elected as President He still elected Timothy Geithner as Treasury Secretary, who attested that He has never been a regulator when sworn in, He also appointed William c Dudley, as President of the Federal Reserve Bank, a former Goldman Sachs, Economist who praised Derivatives(CDO’s); He appointed Mark Patterson as Chief of Staff, Treasurery Department, a former lobbyist for Goldman Sachs; He appointed Lewis Sachs as Senior Treasury Advisor, a Head of Tricadia (a company that placed a lot of bets on CDO’s) ; He appointed Larry Summers as his Chief Economic Advisor, the very people who build the structure that caused the global meltdown in 2008 are still in his administration. The Obama Administration has done no investigation on this crime, and have resisted any form of reforms in terms of regulations.
In October 2015, the number of Derivatives contracts which corrupted the markets in 2008 had escalated so much, There is no way these institutions could cover the potential losses that could come from derivatives contracts. They just don’t have enough assets, which means an economic collapse could cause any or all of these institutions to fail. The failure of any of these “too big to fail” institutions could cause the entire global financial system to fail.
- -Deutsche Bank – $55.6 trillion in derivatives exposure as of April 2013 backed by only $575 billion in assets. So their derivatives exposure is 96 times larger than their assets.
- JP Morgan – $72 trillion in derivatives exposure compared to only $2.3 trillion in total assets. Their derivatives exposure is 31 times larger than their assets
- Goldman Sachs – $41 trillion in derivatives exposure compared to only $938 billion in total assets. Their derivatives exposure is 43 times larger than their assets.
- Citigroup Inc – $57 trillion in derivatives exposure compared to only $1.9 trillion in total assets. Their derivatives exposure is 30 times larger than their assets.
- Bank of America – $44 trillion in derivatives exposure compared to only $2.2 trillion in total assets. Their derivatives exposure is 20 times larger than their assets.
- Wells Fargo – $44 trillion in derivatives exposure compared to only $1.3 trillion in total assets. Their derivatives exposure is 33 times larger than their assets.
(Source: FDIC and SNL Financial for US institutions, Zerohedge.com for Deutsche Bank)
I believe that only a Kingdom Financial system will solve all of these global economic challenges, all of our efforts to save ourselves will not work, everything must be shaken so that man can see that nothing he builds outside God will stand the test of time, Unless the Lord build the people labour in vain.
3. You cannot serve God and Mammon! The greed factor…
Whoever loves money never has enough: whoever loves wealth is never satisfied with their income. This too is meaningless. As goods increase, so do those who consume them. And what benefit are they to the owners except to feast their eyes on them? Ecclesiastes 5:10–11
One of the things we saw with the 2008 Global recession was how a culture of greed can crash the markets. People made so much money with small investment and short space of time, and the more they made money they wanted more and more and more. The staggering size of the derivatives market explains why billionaire investor Warren Buffet has called them “weapons of financial mass destruction.” Derivatives can result in large losses because they use leverage, which allows investors to earn large profits or losses based on small changes in the price of the underlying asset. Leverage makes it possible to earn very large profits or losses from relatively small investments.
Even Barack Obama in his campaign speech on the 28th September 2008 said ” The era of greed and irresponsibility in Wall street and Washington has led us to a financial crisis so serious than in the depression period”
The big question is but why so much greed and corruption? It seems that greed and corruption has become normal everywhere…even here in South Africa we are dealing with greed and corruption in our government, our leaders seems not to care anymore. I believe this is one of the indicators that man has an inherent immoral or corrupt nature, and he needs to be redeemed from himself, and that obviously put the responsibility on us to continuously engage our business and workplace colleagues in conversations about values, ethics and humans inability to do what is right because they is not right with God. I am talking about conversations happening from Junior levels up to Executive Levels. In fact Executives face a lot of ethical challenges and their decisions tend to affect so many lives.
No one can serve two masters. Either you will hate the one and love the other, or you will be devoted to the one and despise the other. You cannot serve both God and mammon. Matthew 6:24
The word “mammon” has been wrongly translated as money..Infact the word “mammon” is a name of one of the Caananite god/ idol .The spirit of mammon deceives many people to pledge their worship, devotion and allegiance to it through a culture of performance..in pursuit of money at the expense of God.
4 lies the spirit of mammon tells people :
- The real power lies in money, if you don’t have it you don’t have power..so run after it!
- Your value is worth your money ” He is worth R20billion”
- Constantly fear the lack of money…what if you don’t have enough? You must work more….
- Your provision only comes from your sowing and reaping!…that is a biggest lie! Your Father loves you and provides for you..You are a steward of what He entrusts to you..
Choose for yourselves this day whom you will serve … But as for me and my house hold, we will serve the LORD. Joshua 24:15–16
4. Business as a Calling not just about hedge
While it is important to focus on the bottom line, especially for hedge fund managers, always faced with bear markets, it is important to know that your work matter to God, He cares about how you apply your faith in your business and work
Every Monday morning millions of these Wall streets and JSE etc professionals around the world go to work forgetting what they heard or did on Sunday and move across an imaginary demarcation line. This says there is little relationship between what they experience on Sunday and what they do on Monday. Sound preposterous? It may, but this is the mindset of many professionals in our world today. The spiritual does not mix with their everyday world of the workplace. “What happens on Monday has no relationship to what takes place on Sunday,” they say. These are the thoughts expressed so much in our day and time, although they are not expressed in such direct terms In simple terms, what I am saying is that most professionals either do not see the need to live out their faith in their workplace and business or they don’t believe in starting their lives, work and business on the foundation of faith. They view their work and business as secular with no direct relationship with the supernatural/ faith.
I believe that God is raising up a new remnant of professionals who perform their daily work with an overriding ministry objective to it. These professionals have made spiritual discoveries that are now resulting in them being used by God to impact the world. This is the ultimate fulfilment when a person understands why God made them and that they are actually called to the profession they are doing and God uses them to impact the world.
True success is fulfilling the purpose for which God made you. It has little to do with money, prestige or notoriety. God’s measurement of success is very clear – doing the will of God. His greatest commandment is to love the Lord your God with all your heart, soul and mind. From this relationship with God everything else should flow. We cannot help but impact our culture if we love God and obey Him.
God is looking for righteous professionals and business leaders who will turn our nation back to a righteous form of commerce. Even if the market can collapse but God’s Financial system remains unmovable and unshaken.
“Do not store up for yourselves treasures on earth, where moths and vermin destroy, and where thieves break in and steal. 20 But store up for yourselves treasures in heaven, where moths and vermin do not destroy, and where thieves do not break in and steal. 21 For where your treasure is, there your heart will be also” – Mathew 6:19-21
And that is the reason for my hope even in times of economic crisis, that all my treasures are in heaven, they can never be destroyed and stolen.
By : Thabo Mahlobo, MFVest
References: Marketplace Leaders ;The Global crash of 2015