Servias Ministries Blog

Syria continues to be on the forefront of network news.  You can step back and look at global power views and see what they want us focused on.  Do the globalists want us in another war?  Zero percent interest rates prevail since there is not enough consumption to bring the economy out of its true recession.  Both Iran and Syria are apparently destabilizing the Middle East and the U.S. will protect its energy interests.  The following chart shows that we are in unprecedented, uncharted area now:

The short-term American economy has been “fixed” by wars in the past only to see its economic health suffer in the long term.  Instability in other areas of the world cause a flight of capital to U.S. Dollars.  This bodes well for the current state where the U.S. Dollar is losing its reserve status.  The macroeconomic picture does not reflect recovery but instead it reflects substantial uncertainty that has no solution.  This would indicate that precious metals will be the insurance of choice.  There is so much sovereign debt out there that no central bank can afford to allow interest rates to rise.  Ultra low rates cause baby boomers and seniors to quit spending since they cannot see an improvement in cash flow on their investments/retirement income.  Both situations feed on each other.  Consumption based on a major war machine is one alternative.  Let us pray that this alternative is not sought to fix an ill-fated economy.

Surely there is some justice to be administered for all the unsuspecting retirees who lost some of their life savings over this.

For better viewing of the above: http://www.healthcareadministration.com/libor/

Did the lawlessness of the 1920’s correlate to the dust bowl and great depression of the 1930’s?  The anything goes attitude of a once righteous nation seemed to evoke a punishment in the 1930’s.  The abundance of sin and excess was well documented during that era.  It would appear that the current track of lawlessness far exceeds the 1920’s.  The moral fiber of the country has all but disintegrated.  The lust of the flesh, addictions to just about anything, and the arrogance of pride seem to be at epic proportions.  The following chart is compelling:

Historically until President Nixon closed the gold window, the external debt of the United States was collateralized by gold owned by the U.S.  Nations knew that they could trade their dollars for gold upon request.  This created a stable and verified currency market.  Confidence in the U.S. Dollar was at 100% because other countries had that convertibility option.  Economic cycles of mild expansion and contraction were manageable.  The Vietnam war began to take its toll on the system.  Debts were piling up as the U.S. continued its attempt to assert its dominance in Asia.  France decided to exercise its right to exchange excess dollars and convert to gold.  Loss of confidence in America’s ability to manage its external debt led to this move.  Nixon responded by closing the gold window and letting the price of gold float rather than keeping at a fixed convertibility rate.  This was the beginning of the end of the dominance of the U.S. Dollar.

If you were to graph the relationship of the external debt to the “stated” gold reserves of the U.S., the following would result:

The external debt of the U.S. could be satisfied if the gold reserves were valued at $19,500 per ounce, a ten fold increase of the current price.  Which would a country rather hold, a piece of paper or an ounce of gold?  Which medium of exchange promotes confidence in future value?  Based on historical ratios, silver would demand $1,220 per ounce.  You can see why Our Heavenly Father encouraged a precious metal as a medium of exchange.  Man can’t manipulate it.

The following 21 minute video provides the reality of the Libor scandal.  We have blogged about the underlying issues for years now.  The scandal is causing the ugliness to surface and Former U.S. Assistant Treasury Secretary Paul Craig Roberts explains the harsh reality- fraud will not be prosecuted at the highest levels.  From a Biblical perspective, lawlessness will prevail until judgment comes.  As the trust in the U.S. Dollar erodes further, people will seek out other investments to protect their wealth.  Only Our Heavenly Father knows when this will accelerate and create a hyper-inflationary environment for the Dollar.  New laws and Executive Orders have been put in place to combat the flight of wealth from America.  You can now understand why.  The risk of flight grows everyday and could create chaos once the average person really understands the brevity of the problem.

Proverbs 14:34 Righteousness exalts a nation, But sin is a reproach to any people. NKJV

The German phrase translates “quickly and easily”

“explains the rescue screen”

I think they got the answer from Spanky and Our Gang.  Spanky lived in Oklahoma City in his later life.

Gold represents 1% of the world’s financial assets and of institutional money, it is 1/2%.  Nobody owns gold.  In spite of this, gold has risen 6 fold even while governments and banks are attempting to manipulate and suppress the price of gold.  It is now becoming classified as a tier 1 asset along with cash in calculating bank reserves. What does this tell you?

The gold paper market is 100 times bigger than the physical market thus allowing for manipulation of the price.  Governments hate gold because it reveals their deceitful actions.

People are beginning to distrust the banking system.  They will then no longer trust the government.  The Liborgate scandal where global interest rates have been manipulated may not produce any prosecutions.  Why?  Because governments have also been colluding to keep rates low.  The average saver does not seem to comprehend that this scandal is the basis for his or her savings account not producing monthly income consistent with the true market rate.  The saver lost money every month as a result of this scandal.  Do you think that this is an isolated incident in the current financial system?  What about Madoff, MF Global, and now PFGBest?  When will the next shoe drop and what size will it be?

Lawless and unrighteous investment bankers operate by greed and fear.  They view the public as dopes.  Every deal they attempt is based upon greed- how much money can I make?  If there is no risk of reprisal for their greediness, they become brazen.  Only fear of punishment will keep them at bay.  Since in recent times there have been no felony convictions of top investment bankers, the fear has been removed and greed is now at a zenith.  It matters not to these people whether cities, counties, states, or countries go bankrupt as a result of their greedy actions.  It matters not that people lose their jobs as a result of a flawed financial deal.  The goal is to enrich their own pocketbook.  Only by the real and present danger of jail would these banksters move their value pendulum to the other end- fear.  However, the current economic environment needs to facilitate investment activity to sustain or reinvigorate economic growth numbers.  Without growth, the current system would implode and those in power would lose their jobs.  Greed seeks power thus they don’t want to lose the power they currently wield.  Do they have a true solution to their problem?  No, and loss of trust by the population will be the outcome.  When that happens, what financial asset do you think that the average person will flee to?

The central governments are convinced that people will flee to gold and silver. I conclude this by their actions to manipulate the price downward.  The price of gold is the classic canary in the coal mine.  Once the average person sees the core values of those in power, he or she will take action to protect what little wealth is left.  What asset would you convert to?

If my conclusion is correct, both gold and silver will skyrocket.  We do not give investment advice nor endorse any particular investment.  These blogs are meant to provide a macroeconomic picture of the current system and provide spiritual insight to the state of mankind.  You should seek the advise of an investment advisor before making any investment.

Who has been prosecuted for the 2008 financial meltdown debacle?

Who has been prosecuted for the MF Global missing money?

Do we need more regulation?  No.

De we need more regulators?  No.

Do we need enforcement of the existing regulations?  Yes.

Does anybody care?  Only those who lost money but by and large they have no power, authority, or ability to evoke judgment against the well-connected.

The core issue is the greed-based system that has declined to a system where the lawless are encouraged to break the law because they are deemed above of the law.  If you have a trading account, how can you be sure that your money will be there tomorrow?  You can’t.  So, what is your net worth?  You can’t be sure since you are basing it on pieces of paper that may not reflect the reality.

What in this current system can we count on?

What is the one economic system we CAN count on?  A Theocracy based on Love!

In the following video, Max Keiser makes several points about the current monetary system.  I cannot refute any of his points:

The Central Banks are looking at charging member banks interest on their deposits.  Additionally, there is a move to eliminate capital requirements on holding sovereign debts as assets (Basel III Accord).  These two moves would provide banks an incentive to go out and buy sovereign debt and fund the continued expansion of the current debt-based debacle.  The Federal Reserve Bank would not have to expand its balance sheet if banks take up the slack.  Unbelievable!

Commercial banks currently have over $1.4 Trillion in the central banks as deposits and currently earn .25% on their money.  If the central banks were to begin charging interest and at the same time eliminate reserve requirements on an alternative investment (sovereign debt) then the commercial banks would convert those deposits on their balance sheets to sovereign debt.  This move could easily flood the global market with up to $15-20 Trillion in money supply based on the fractional banking system.

With private borrowing being contracted, the sovereign market is where all the demand is.  Countries around the world continue to expand their debt levels due to their insatiable desire to expand at all costs.  This move would not serve to expand the private business sector which produces real GNP growth but would instead create a temporary boom in further government spending.  Commodity prices would inflate and the average person would be taxed by these higher prices.

If these two moves occur, we could see the price of gold soar to record highs with other commodities following.  Even considering these moves speaks to the desperation of the current system.  We are watching history in the making.  Unfortunately it is looking mighty ugly.

The LIBOR scandal exposes the reality of the state of the current system.  There should be global outrage about this scandal which affected virtually every loan around the world.  Instead, Tom Cruise and his divorce appear to be more important.  Why is there no outrage?  The immorality of the population has overtaken the need for righteousness and the demand for lawfulness.  What a sad state!  For those of us pursuing the fullness of all Our Heavenly Father has for us, it can be a frustrating time.  Imagine how Daniel dealt with the captivity of his time and multiply it many times over.

The birds will come home to roost soon.  At some point Our Heavenly Father will open the eyes of the people and they will make a run on the banks in Europe.  The wealthy have already begun to respond but the average person has yet to figure out the endgame of printing money and inflating the currencies to pay sovereign debt with depreciated currencies.  Gold, silver, oil, and gas will continue to be the true currencies of value.  Energy will be a “currency” as long as the current energy-dependent infrastructure is in place.  Do you really think Our Heavenly Father will release “free” energy to perpetuate the current state of lawlessness?

The latest unemployment numbers indicate no change in the U.S. economy.  True unemployment is still over 22% based on shadowstats.com.  I agree with that number.  On a recent trip to the Gulf coast, the condo we were staying at had 25% of the units unoccupied during the peak week of the season.  In 2008, they would have all been lit up like Christmas trees.  People have cut back their vacations to a few days versus a full week.  The beaches were not as crowded as they have been historically.  The souvenir shops and restaurants were not as busy either.  Food prices were up as inflation grips the commodities due to the excessive money printing by the Fed.

When will the people cry out for Our Heavenly Father to intervene?  The current system is heading for collapse and my goal is to be prepared for that eventuality.  Take on no new debt, eliminate existing debt, and simplify.  Take advantage of the opportunity to reduce ongoing expenses and your level of overall pain will be lower when things get dicey.