Servias Ministries Blog

In the economics analysis arena, there is a quote that sums up the challenge of these times: “Things can stay irrational longer than the rational can remain solvent.”

The Federal Reserve is planning to test the largest banks against a severe economic event.  The following is their stated criteria for a “severe” event:

In the “severely adverse” scenario, the unemployment rate peaks at 11.25 percent, stocks fall nearly 50 percent and U.S. housing prices decline 25 percent while the euro area also sinks into recession. Developing economies in Asia also experience a “sharp slowdown,” the Fed said.

Let’s analyze their numbers that make up the severe scenario.  An official unemployment rate of 11.25% would probably equate to a true unemployment rate of 36.4% based on John Williams’ www.shadowstats.com current unemployment reporting of 23.3% unemployment versus the government’s 7.3% massaged number.  With this level of unemployment, healthcare, retail, pharmaceutical, automobile, and other industries would all be in a downward spiral.  Pension funds losing 50% of their stock portfolio value would surely curtail benefits.  Housing prices could easily decline past their 25% expectation, however mortgage debt remains high thus promoting another wave of defaults.

Interest rates have virtually no where to go but up.  This would be a reasonable scenario to consider since the Fed is out of ammunition to boost the economy.

If the Fed is considering this scenario, I suggest you and I should also plan for it.  It is what it is, no sense getting angry about what they have done.  Simply focus on your plan to deal with such a downturn as best you can.  Our Heavenly Father has a plan and those who hear will carry it out.

See: http://mobile.bloomberg.com/news/2013-11-01/fed-to-test-banks-against-interest-rate-rise-housing-collapse.html

An interesting comparison:

When you buy gold or silver, you effectively vote against the future of the Dollar.  When confidence is lost in a currency, gold & silver are acquired along with other international-oriented assets.  Oil & gas are also traded internationally.  Real estate is a tougher call unless it is farmland.  Food producing land is a good investment since we all must eat.  Adding new debt is not a great idea unless it is absolutely necessary.

When fear of hyper-inflation grips the population, the event feeds on itself and perpetuates further decline, ultimately to zero.  There are many examples in the past to draw from.  The Weimar Republic of Germany is one.  Go to http://en.wikipedia.org/wiki/Hyperinflation for 39 examples.  The result is always ugly.  The business demand goes down, not up.

The U.S. National Debt is going up, up, and away.  The global derivatives continue their growth into the stratosphere.  There are multiple complex problems that defy solutions, any one of which could be the Black Swan to cause the whole system to come crumbling down.  Politicians continue to kick the can down the road.  The latest government shutdown was not resolved, just postponed.  Don’t you think if they had a real solution, they would have implemented it?  China, Russia, and other BRICS countries are moving away from the dollar when they settle their net changes in trade.  The recent NSA scandal as well as the other scandals all point to an untrustworthy reserve currency.  Men’s egos will not let this mistrust go unpunished.

There have been multiple takedowns in gold.  If it was an ancient relic, why would those in power bother with multiple takedowns.  There are 93 ounces of “paper” gold traded against every physical ounce of gold held in a warehouse.  The current futures market cannot deliver its contracts if the players were to demand delivery of their contracts.  Instead, they would be settled with Dollars.

The masses are living in denial.  They have no clue how ugly it could get when the U.S. Dollar is no longer the reserve currency.  The standard of living will decline.  Food stamps have already prevented bread lines.  Recently in this state, there was a 24 hour glitch in the food stamp system and I saw grocery shoppers walk out without their food.  The problems continue to be masked from our eyes.  Government statistics are orchestrated to paint a rosy picture.

Bail-ins are coming.  What is a bail-in?  This is where a depositor is required to cover his or her percentage of losses of that bank.  When you deposit your money in a bank, you are an unsecured lender to that bank.  Your deposit is classified as a liability on that bank’s balance sheet.  Bondholders are secured lenders.  If a bank becomes insolvent, the secured bondholders are paid first.  Everyone is paid a percentage of the remaining assets.  In a major banking crisis, the FDIC does not have enough money to fund the insurance portion of your deposits.  The bail-in plan includes nationalizing retirement funds.  The International Monetary Fund is leading the charge on the “bail-in” method of dealing with the current banking crisis.  Depositors in Cyprus lost 83% of their deposits.  Is Cyprus the blueprint for future crises?  I think so.  This bail-in plan is being put into law in countries around the world.  With $10 Trillion in U.S. deposits, the FDIC has about $30 Billion to cover all loses.

The OTC Derivatives (http://en.wikipedia.org/wiki/Over-the-counter_(finance)) continues to be a source of major losses on bank balance sheets.  They are allowed to carry these assets at cost rather than market value.  Many of these derivative instruments contain substantial losses.  If a bank had to liquidate today, only then would it have to account for those losses.

Quantitative Easing continues without any tapering in sight.  For the last five years, interest rates have been suppressed.  If all was well, these two actions would not be necessary.  These lower rates were designed to help the banks recover from the losses contained in their derivatives position.  That has not happened.  Banks continue to bet with derivatives.

The main strength of the U.S. Dollar is the petrodollar, the international currency used for buying world oil.  If the Saudis were to allow payment in other currencies, the dollar would drop like a rock.  Gasoline in the U.S. would triple as a result.

What is the time frame for a major devaluation of the Dollar?  No one knows for sure.  Right now, 2016 appears to be the best guess, even though it could happen immediately.  Between now and then, the middle class will suffer heavy losses.  The U.S. consumer-based economy will begin to uncover the inherent losses on bank balance sheets.  The dominoes will begin to fall.

Can these events be delayed?  Only if Our Heavenly Father chooses to delay them.  HE can open blind eyes at any time.  If the populace were to suddenly take interest in the crumbling financial infrastructure, confidence would be lost immediately and the annihilation would begin.  Simplify your life and set aside time for Our Heavenly Father.  You will be glad you did.

Ms. Tavenner sidestepped the question about how many people have enrolled in Obamacare:

Her interview starts at 1:44:

Any IT Professional knows that you could run a Query against the database, and in less than 5 minutes, come up with the enrollment number… worst case.  This is not a technical issue in any way, shape, or form.  Let’s be open about the truth.  Our little census had an accurate, running total at all times.  Maybe they should have paid my little company the $634 Million to develop the site.  We could have done no worse.  After all, we use world class IBM Servers that are designed to handle huge volumes.

For website development cost verification, see: http://www.newsmax.com/Newsfront/obamacare-website-millions-glitches/2013/10/10/id/530382

When I was a child, I never considered getting a college degree in Economics.  As a senior in high school, that degree was not on my radar at all.  For what ever reason, Our Heavenly father steered me toward that field of study.  It appears that its relevance was to be fully appreciated at this time in my life.  My parents were able to enjoy their golden years in a stable economic environment.  They lived the dream.  Interest rates were stable enough for them to retire and live on a modest income without concern for their next meal.  It does not appear that my generation will be so fortunate.  We live in a different economic reality today.

Many people have prophesied of economic or financial events occurring at specific times.  Those of you with Iraqi Dinars know this all too well.  It’s imminent revaluation has been predicted how many times?  Some of you have been so focused on the revaluation, you have probably missed opportunities to be fruitful in other areas.  Macroeconomic events never happen when men think they will.  Why?  There is no sure measurement technique of fear and greed.  Fear is even more difficult of the two to measure.  The “flight” mechanism in man is triggered by some subtle event that is not easily identified.  If the study of Macroeconomics was more precise, the Federal Reserve would not be in the mess it is in now.

How can we protect ourselves from the coming financial storm?  It must be done on all levels: spiritually, financially, emotionally, mentally, and physically.  It has become clear that Our Heavenly Father is using Servias Ministries to help people through the coming events.

Spiritual preparation is more important than any other preparation one can pursue.  Those who are fully prepared in this area will suffer least in the coming weeks, months, and years.  To be spiritually led is the key to properly preparing in other areas.  We must shift our paradigm of historical thought and focus on hearing Our Heavenly Father.  As times become difficult, HE is the only One Who can properly navigate your life through the coming turmoil.  Knowledge and skill alone are not enough to be successful in these times.  If that were the case, the think tanks in Washington would have steered us away from the coming storm.  Each of us needs wisdom and understanding.  We need Wisdom from Above and that is only obtained by hearing HIS Voice.  As we hear HIS Voice, we receive understanding.  How is Servias able to help you mature in this process?  I believe the four books we published, our blogs, and our weekly Bible study are designed to help you through the coming tumultuous times.  Those who assume that life will go on without any significant change are in for a rude awakening.  I wish I was wrong but the numbers don’t lie.  There is no mathematical way to sustain the current path for much longer.  Only Our Heavenly Father knows the day and the hour that the “fear factor” will kick in.  When that happens, it will be too late to prepare.  Your pain will be in direct correlation to your various states of preparation with the Spiritual state being the most critical.

Our Heavenly Father may have you take some actions the are counterintuitive.  As an example, HE may have you give money when you are trying to hoard as much as you can.  Why?  You are planting seed for future harvest.  Farmers know to set aside seed for next year’s crop.  It is a simple Spiritual Law.  Investing in the Kingdom has the greatest future return on investment.  My wife and I actively support the Kingdom with our own finances.  We support Servias and other ministries just like some of you do.  Servias has no payroll.  I would suspect that we at Servias are getting the most “bang for the buck” through the donations.

The Sunday Bible Study broadcasts are specifically focused on your preparation for the coming storm.  I am rather surprised at the low number of viewers versus those who read our blogs.  If a person gets just one revelation out of each broadcast, the 60 to 75 minutes was well worth it.  People would rather be entertained than to uncover some new revelation reserved for this time.  When the storm comes, those areas of entertainment will not matter.  When the strongman comes to take your house, it will be too late to go buy a set of barbells and prepare.

I expected to begin our Bible Study broadcasts on the book “Raising the Remnant” at the time of Tabernacles but that did not happen.  It was needful for us to spend the extra time on understanding Divine Intent and the quantum versus the non-quantum.  There is some foundational understanding required at this time in history and thus we needed the revelations found in this book.  The “Remnant” Bible study will focus on maturing the Saints.

It is better to over-prepared rather than under-prepared for the coming storm.  The apparent delays are a blessing to those who are still preparing.  I believe the 3rd Baptism is reserved for those who are called to serve mankind in the coming storm.  Some of you have wondered about your calling.  It may be revealed soon as we get closer to the storm.  Jesus Christ has power and authority over all of the particles of creation.  Our Heavenly Father will appoint certain men and women with that same power and authority when the bottom falls out of the current illusion of monetary stability.  HE is preparing those who have ears to hear.  I trust our books, blogs, and broadcasts are part of HIS plan.  They certainly weren’t my idea.  I am simply serving at HIS Pleasure!

Here is the problem in the current pension fund environment.  Many pension funds make long-term assumptions, typically optimistic.  The following graph show an expected 8.75% annual return on investment on $1,000:

For each $1,000 invested, in 30 years you would end up with $13,800 at 8.75% interest rate.  What happens when the interest rate drops to 3% for an extended period of time?

You end up with $10,000 less.  This is what the shortfall in the pension funds is all about.  They are in denial and continue to expect improved performance.  With short-term money at .7%, the deficit to be made up intensifies.

The Federal Reserve continues to suppress rates and print more money.  Life Insurance companies are using the same assumptions as pension funds.  At some point there will be a “Great Leveling”.  Your whole life insurance may go into the deep red, your pension fund may be grossly underfunded, and your saving dollars’ purchasing power is disintegrating.  This is why I personally view having at least 10-20% of savings in physical assets.  However, you should contact your investment advisor to determine your optimum investment position.

In the following video, Matt Taibbi and Sam Seder tackle this all important question.  In our special ustream broadcast yesterday, we discussed “The Corrupt Church” in Revelations.  As has been said in the past: the church reflects society and its leaders.

This clip provides a perspective on the newsworthiness of the financial media and the fact that lawlessness is intrinsic to the too big to fail aspect of banking.  Our Heavenly Father does not agree with this view.  HE will have a corrective interview at some point.  When this happens, we should not be surprised by the magnitude of judgment.  Don’t be part of the collateral damage, simplify and protect yourself from the tsunami sure to come to the corrupt financial system.

As predicted, the U.S. came to an agreement to temporarily deal with the shutdown… For 90 days. The market is not pleased, the Chinese are not pleased, and the Japanese are not pleased. They are the two largest bond holders of U.S. debt. They both issued warnings so they are now on record.

China continues to acquire gold to back its international transactions as it sets up partnerships with other countries, bypassing the Dollar. At some point, the Dollar will no longer be the world reserve currency and the Washington beltway will be looked at as the culprit. Everyone will point fingers and no one will accept responsibility for the loss of global power. It will nonetheless take place. The entitlement and arrogance will evaporate into history. Only a major shift in the belief system of the populace would change the present course. Our Heavenly Father has the means to cause this shift but it would be accompanied by a corrective judgment equivalent to the current state of lawlessness. Buckle up!

The ego will create a problem then solve it.  The intent is to show its superiority and maintain control.  The U.S. Congress continues to debate toward a solution to the “debt” crisis.  The crisis will be averted, the stock market will rally, but the problem is not solved.

The following chart produced by the St. Louis Federal Reserve provides perspective:

The U.S. Credit Market is right at $60 Trillion.  What crisis?

The headlines that came out this week were designed to discouraged those who believe gold & silver to be the best insurance against the current chaos.  The Federal Reserve’s agent banks, utilizing insider information, orchestrated another smackdown of the “paper” price of gold and silver.  Why?  They are trying to defend the Dollar.  Mainstream news outlets are owned by large corporations who are motivated to support the Fed, even if it is for nefarious purposes, aka, love of money, greed.

If gold & silver were truly out of favor, gold would be at $275 per ounce and silver would be priced at $5.15 per ounce.  Instead, they are four times higher or, the value of the Dollar is four times lower, thus it takes more depreciated dollars to buy these metals which are “out of favor” or “hated” by investors.  China and other countries are taking advantage of the smackdown once again.  Related quality stocks are stunning buys.  The Fed will take down mining companies that are cash poor.  They are simply casualties of the current policy of desperation.  The Fed does not give a rip about the masses of people who will be hurt by their actions.  It is all about protecting the wealthy elite and their agenda.  This is the essence of the not-so-mysterious Babylon.

As gold & silver are being pummeled, commercial banks are worried about protecting their digital assets and our deposits.  Watch: http://www.bloomberg.com/video/-quantum-dawn-2-is-a-cyber-attack-bank-drill-~FFjng~nR9ir5OoFnRPLNw.html

Your money in digital form is at risk of being accessed by adversaries around the globe.  Men’s egos think they are superior to others.  Who is to say that the security expert protecting the banks is the smartest IT guy on earth?  One must realize that there is always a smarter guy out there with the tools and determination to take over as king of the hill… even if only for 15 minutes of fame (another aspect of the ego).