Servias Ministries Blog

The host of the 2014 World Cup is having its own internal economic issues.  See: http://www.businessweek.com/news/2013-06-17/brazil-protests-to-resume-after-rousseff-jeered-at-soccer-match

Having traveled internationally, I can attest to the disparity of wealth in many countries:  The wealthy and the poor.  A strong middle class is needed to promote economic stability and in many countries there is not much of a middle class.  America’s strong middle class is disintegrating.  The change in laws concerning the financial institutions have created an environment where the average middle class family cannot properly plan for the future.  Ultimately stagnation comes and shrinks the middle class structure.

The Brazilian people are getting tired of their conditions.  The Internet has served to provide a “second witness” to their situation.  Communication is typically the first thing to be removed from a country during war.  If you can isolate people, you can more easily control them.  It will be interesting to see if the Internet becomes restricted from free speech in Brazil.  Until then, videos like the one below will provide opinions other than the “official” position of a country:

This video is not provided as a political statement about Brazil but to simply show the global concerns expressed by a diversity of people.  The true solution is from Our Heavenly Father and revelation from Above that will resolve all that the young lady mentions as Brazilian infrastructure issues.  Love is the answer to our problems and until it is fully embraced by those in charge, dissension will continue.  As Our Heavenly Father places HIS remnant in positions of authority, the Kingdom will come.  I think it would be fabulous if everyone in Brazil would read our books on Love and implement the revelations contained therein.  You could then embrace a World Cup because everyone would be working together instead of being in division.  The solution for all countries remains the same: Love!

Japan, the world’s third largest economy, has tried to print money as a way to get its economy growing again.  The strong economic growth of the 1980s ended abruptly at the start of the 1990s. In the late 1980s, abnormalities within the Japanese economic system had fueled a speculative asset price bubble of massive scale by Japanese companies, banks and securities companies. The combination of exceptionally high land values and low interest rates briefly resulted in heightened liquidity in the market. It led to massive borrowing and heavy investment mostly in domestic and foreign stocks and securities.  Hmmm!  This sounds like what the U.S. has been experiencing.   There is one big difference.  The economic size of the U.S. dwarfs the other countries and can cause the entire global system to suffer the contagion.

The following graph depicts the recent Japanese Stock Market performance from Nov 11th, 2012 to May 28th, 2013:

Japan attempted to use the money printing presses to inflate its economy.  On a temporary basis it worked… only temporary.

It seems that the U.S. learned nothing from the 2008 Financial Meltdown.  The second crisis is continuing to develop.  This crisis could have been avoided if the rest of the world had taken note that the United States is unable, unwilling, and structurally incapable of reforming itself.  Greed prevailed in the “too big to fail” banks.  Unfortunately the institutions of global governance have proved to be completely ineffective and powerless in managing the crisis.

Self preservation at the personal level has prevented those currently in control to take any action for the good of the average citizens.  Recent revelations of the widespread eavesdropping activities only serve to expose the willingness to bypass the “Sacred Trust” of the people in order to promote skewed agendas that have greed and power at their source. “Power corrupts; absolute power corrupts absolutely.”

We are moving into a time of upheaval.  One must continue the preparation even though there are no immediate signs in view.  Be cautious and move your trust away from the current system.  Put your trust in Our Heavenly Father.  The less trappings of the world you have, the less “stuff” you must maintain.  A move toward “personal efficiency” needs to be made.  De-clutter your life, simply put.

In the coming months, you will hear more about the “Bail-in” method of financial institutions staying afloat.  This is where creditors’ money is converted to bank stock, without their explicit approval.  It is a simple balance sheet method of converting a liability to equity and voilà, you have improved equity ratios and stability.  The poor creditors are now holding stock in a financial institution that made poor decisions that caused this display of magic.  If creditors wanted to hold stock, they would have invested in the bank’s stock to begin with.  In essence, this is robbery and fraud mixed together.  Only in a Theocracy would the creditor be assured of proper treatment.  “Wax on, wax off”, “Bail in, bail out”… it is all sounding the same.

I write these economic blogs to keep you abreast of the condition of the current system.  We need to monitor the current system as we personally prepare ourselves for the upheaval ahead.  The personal preparation must continue as each of us matures toward that “Remnant” stage.  We must be vigilant in our focus to hear Our Heavenly Father, gain new revelation from Above, and mature in Love toward others in our daily walk.  We have been given the opportunity to prepare.  Let’s not overlook it.

The latest buzzword is SIFI and this particular buzzword can “buzz” right through your checking account without notice.  In a recent speech, Fed Governor Jeremy C. Stein at the "Rethinking Macro Policy II," a conference sponsored by the International Monetary Fund, Washington, D.C. on April 17, 2013 made the following statement about large banking institutions:

“Where do we stand with respect to fixing the problem of "too big to fail" (TBTF)? Are we making satisfactory progress, or it is time to think about further measures?

I should note at the outset that solving the TBTF problem has two distinct aspects. First, and most obviously, one goal is to get to the point where all market participants understand with certainty that if a large SIFI were to fail, the losses would fall on its shareholders and creditors, and taxpayers would have no exposure. However, this is only a necessary condition for success, but not a sufficient one. A second aim is that the failure of a SIFI must not impose significant spillovers on the rest of the financial system, in the form of contagion effects, fire sales, widespread credit crunches, and the like. Clearly, these two goals are closely related. If policy does a better job of mitigating spillovers, it becomes more credible to claim that a SIFI will be allowed to fail without government bailout.”

See: http://federalreserve.gov/newsevents/speech/stein20130417a.htm

Does he think that the ultimate depositor isn’t also the taxpayer and that the taxpayer isn’t the ultimate loser of the SIFI bank’s gambling policies that have been allowed to infiltrate the entire financial infrastructure?  Does he think there are a bunch of smaller banks isolated from the impact of a SIFI bank melting down?  C’mon!  Help me somebody!  They have been pushing for a fully integrated financial system so they can control the population and now it is poised to bite the on the ______. (please insert your own word)

The systemic risk of the overall system is being overlooked, misunderstood, or just plain misrepresented.  Only Our Heavenly Father knows how this will play out.  The probability of a Black Swan event is on the rise.  The central planners have allowed the system to become too complex to maintain control.  None of this is unexpected by Our Heavenly Father.  Man’s systems independent of Our Heavenly Father always end up failing.  It is only a matter of time.

This is not your parents’ era where there were no worries about the money in the bank being at risk.  It is important to understand what is being contemplated to save those “too big to fail” banks.  Don’t think that local banks are isolated.  When I was in banking, I studied and analyzed the operations of the “Cash Desk” where Fed Funds (excess bank cash on hand) were traded on a daily basis.  I would buy $10 million from a community bank, packaged it up with other community bank Fed Funds purchases and sale up to $250 million of Fed Funds overnight to a NY money center banks such as Chase Bank.  The next morning the funds would be returned to us, then the community banks.  Then the process would start all over.  On Friday we would sell for 3 days to cover the weekend.  What would happen if a Black Swan event happened on Friday night?  On Monday, all the downstream banks would be out of cash.  Oops!

Resolving Globally Active, Systemically Important, Financial Institutions
A joint paper by the Federal Deposit Insurance Corporation and the Bank of England
10 December 2012

From the FDIC Paper Executive Summary:

In the U.S., the strategy has been developed in the context of the powers provided by the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010. Such a strategy would apply a single receivership at the top-tier holding company, assign losses to shareholders and unsecured creditors of the holding company, and transfer sound operating subsidiaries to a new solvent entity or entities.

As a depositor, you are an unsecured creditor.  Think about it.  What is your tolerance for risk?

See: http://www.fdic.gov/about/srac/2012/gsifi.pdf

In the big picture, the central planners are still trying to keep the wheels on the wagon as is goes down the mountain of debt and derivatives with huge boulders in the way.  There is no way to navigate past all of the obstacles and safely make it back to normality in the financial markets.  Our parents were given 5 decades of rather reliable economic times in the West.  That reliability is gone.  Greed has been raising its ugly head for the last 30 years and the politicians on both sides of the aisle have accommodated  big business in changing laws to exploit the weak and helpless in all aspects of the current system.  Antitrust legislation has been gutted, financial institutions have removed any barrier that would prevent them from gambling with depositor money, and in the name of technological advancement, the population has been convinced that electronic money is superior to physical money.  Nothing could be further from the truth.

Once you remove the physical characteristics of money, you have complete central control of all money.  The individual becomes servant to the system.  You can no longer make your own decisions without potential intervention.  The value of your stored wealth can be manipulated with one keystroke and there is nothing you can do about it.  What are we to do?

Debasement of currency value can be offset by investing in real value.  Owning a physical asset offsets the attempts to control your stored wealth by electronic keystrokes.  There is likely a Black Swan event coming.  There is no way that central planners can perfectly execute a plan without flaw.  That unforeseen flaw will cause the tide to turn dramatically and when it does the entire financial system will be turned upside down.  All the wheels on the proverbial wagon will come off simultaneously.

The Fed will not reduce Quantitative Easing (aka money printing) before the Christmas season.  Thee is too much to lose.  But after Christmas, they will attempt to slow down the money printing efforts and that will backfire.  Once the market perceives the issue, gold and silver will make a dramatic move upward and other physical assets in demand will do the same.  In the meantime, I am still prepared for gold and silver to be slammed again.  If so, many of us will be buyers.  If silver goes below $20 and the related silver producer stock hit 52 week lows, I hope to have some cash to add to my current positions.  The same for gold going below $1,300.  The precious metals are the enemy of central planners in the West.  They will try to dissuade investment in gold and silver with any means possible.  Their marketing,advertising campaign attempting to slam precious metal investing is no longer working.  Savvy investors are just buying the metals at bargain prices.

John Williams at www.shadowstats.com continues to see the setup for hyper-inflation.  He may sound like a broken record, but he remains firm in his belief that we are nearly at the point of this extreme event.  His latest comments:

Market Instabilities Suggestive of Nearing, Hyperinflation End Game

Monthly Retail Sales Gain Was Statistically Insignificant; Recession Signal Intact

Consumer Liquidity Remains Heavily Impaired

The consumer has no money to bring the economy into recovery, the double-dip recession is at hand, and hyper-inflation is close.  If there is ever a time to focus on hearing Our Heavenly Father’s voice, it is now.  HE has the only answer to the failing, complex environment man has created.  Don’t be a victim to the current system.

“When you don’t know what’s happening in the market, don’t do anything, because anything you do might turn out to be stupid.  If you’re an amateur watching a poker game being played by professional gamblers, just keep watching.  You’ll probably be better off watching the game than joining the game.”

A beloved brother from “Down Under” wrote me an encouraging email about our online Bible study yesterday:

Hi Bob,
Simply to say I am in "full absorption mode" with Dr. Speckhart because there is so much to absorb. It is incredibly believable and clears away some "unknowns" till now; so you may choose to tell him there is one dedicated listener here Down Under, albeit stunningly muted! What else!!!
My wife is persevering with interest and my son is picking up on points here and there but definitely all positive and in belief that Vince has a God guided path to the verge of the universe to glimpse beyond the Quantum, in preparation for the trials of the future as this Quantum world of Babylon yields to His authority of "Love".
We are soon to watch this Sunday’s ustream broadcast which is the one without Vince and eagerly await the reflection across all that he has said.
We are often delayed in watching your Sunday sessions because we endeavour to get together, clear in thought as possible, to absorb and discuss what we can. When you suggest we may get "one thing" from this discussion being worth while; it is likely, given time, we will have considerable transformation in our understanding once we have absorbed much of what he has written. Vince will have a "time delay" action in my life like no other but I must remain patient.
Pressing the boundaries is an invigorating experience and we look forward to his return.
The ustream broadcast is fully effective and without corruption now.
Thanks for your sterling efforts.
Love and Blessings

“Pressing the Boundaries” sums it up.  After we finish the broadcast, we continue with post-broadcast discussion, sometimes as long as an hour.  Kemper’s working definition of Wisdom- “Hearing with the willingness to receive correction” is appropriate when absorbing a new revelation such as the  “non-quantum”.  Our friends Rose & Roy have a 40 year history with Pam and myself.  We met in the Assembly of God church and  we all went to two other churches as families from 1973 to 1996.  There were greater revelations to hear, receive, and embrace.  Along the way it was important to hear everything and discern what were truths from Heaven and what were opinions from man.  We could then judge the fruit and see what came from Our Heavenly Father.  Our doctrines were changed, torn down,, built up.  Some sacred cows had to be removed.  This is all necessary in becoming one of the “Amen” Remnant.  In the end, we must seek the Truth.  Truth comes by revelation, not by the number of books you have read, not by the some diploma issued by man’s institution.  Training has its place.  Study has its place.  But a revelation from Our Heavenly Father disclosing a higher truth provides a peace and satisfaction far superior than that contained in a book.  The prophets of old did not have the Internet, or smart phones, or public libraries.  Their attention was not diverted by electronic “time burners”.  There was plenty of time for pondering and reflection.

We will continue to press the boundaries because Our Heavenly Father’s thoughts are higher than our thoughts and we want to ascend in Love, not passively be drawn to the outer darkness.  Let nothing dissuade us from being one with Our Heavenly Father!  And they all said “AMEN”.

It has been said that “Paper money hides the truth”.  Unfortunately I agree.  Paper money starts out as a convenience and is backed by gold.  Then the central planners want to pump up the economy and bypass the normal contraction portion of the economic cycle.  Interrupting this natural rhythm begins the path to destruction of the currency.  We are in the midst of observing this destruction play out during our lifetimes. 

“The increase we have seen in paper wealth is illusory both for individuals and for the world.  But it suits the governments to fool their people.  This gives them the best chance of being reelected and they also engage in theft through inflation.“  The U.S. Government is now under fire for its widespread use of monitoring telephone calls and emails of the entire population.  What is the justification?  Hidden agendas of those in charge will only be tolerated for so long by the masses whether it be manipulation of wealth or compromising civil liberties and basic rights.  No matter how you look at it, we are heading for a major change.

The biggest personal challenge most of us have is the fact that we lived through a rather reliable time in history in the Western World.  Several decades of stability have left us without any comparison to how drastic change can be.  Unlike other countries who have had major upheavals, the Western Nations have been somewhat stable since WWII and most of that generation is now gone.  They can no longer warn us of the alternatives.  The fact is we think we are smarter than the previous generation but only destined to repeat the same mistakes again.

The Silver to Gold ratio has been 16 to 1 for most of history.  Today it is 62 to 1.  Since gold is in record demand which supports its current price (and higher prices), I believe silver is positioned to make a dramatic move upward.  At the current gold price, silver should be $88 per ounce to bring it back in line, nearly a fourfold increase in price.

The question we must all ask ourselves:  Which will go to zero value first- fiat currency or gold & silver?

The various agencies around the world are all looking at depositors’ money as a source of bank recapitalization.  They would simply take a portion of depositor funds and issue bank stock… moving money from the liability category (Demand Deposits) to the equity category (bank stock).  It would be done on a Friday thus depositors would be unaware of the severity of the problem until their funds were safe from withdrawal.

Can they do that?  Sure.  Can they hold your money and only release a small portion as they see fit?  Of course.  When you signed a signature card, you executed a contract with the bank.  Generally, they allow you to withdraw at your convenience but they are not required to release your money immediately.  The laws have always favored banks and other financial institutions to the detriment of the individual depositor.

What if I have less than $250,000 in the bank?  Am I safe?  Maybe.  Do you have a retirement account or pension?  If so, the entity holding your retirement definitely has more than $250,000 in the bank so you are at risk in a secondary fashion.

These are perilous times for investing.  Governments are printing more money and reducing the value of our demand deposits in the bank.  Now we have to be concerned about possible confiscation of part of our funds.

Place your trust in Our Heavenly Father for HIS Word is sure!

The recent drop in the price of gold was called a “six sigma event”.  A six sigma event is characterized by a price drop of six times the volatility (or standard deviations) of the asset , thus the name six-sigma, sigma being the Greek letter representing volatility.

This event has at its roots desperation.  At some point we will reach a climax in the currency wars and all of those currently in power will promote extreme measures.  What will those measures be?  Most statements will start out “For the greater good” which translates “We want to stay in power and in order to do that…”.  The decision of the population will be made as a result of the Spiritual Warfare that has been conducted on behalf of mankind.  In the end, Love will prevail.

We must look at the biggest of pictures to keep our perspective.  The latest attempt at a pure fiat currency system began 42 years ago by Richard Nixon.  At that time, he was desperately attempting to withstand the forces causing the U.S. to lose economic power.  The International balance of payments were in disequilibrium and France wanted to settle in gold, not U.S. Dollars.  Ever since then, any attempt by a Sovereign to force settlement in gold has been met with extreme resistance, even war.  Once you lose your economic dominance, you must rely on your military until there is such a global resistance, your military becomes spread to thin or you simply run out of money to fund such an outreach.

Richard Nixon’s closing of the gold window was an unrighteous act.  As the leader of a nation, his unrighteous act had a negative impact on the Spiritual condition of the U.S.  Of course he is not the only leader to bring forth judgment.  He is joined by a long list.  None of those unrighteous acts are overlooked by the Heavenly Court.  The day of reckoning will occur and we should not be caught unaware of the national judgment.  Indeed, all the nations will be judged for their unrighteous acts.  Our Heavenly Father will grant mercy of those within the borders of the country being judged, but nonetheless judgment must come.  When it does, it may be called a “Seven” sigma event, one of Spiritual Perfection.