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.