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Perfect Storm

By Pastor Hal Mayer

Perfect Storm [1]

Dear Friends,

Welcome to Keep the Faith Ministry. It is wonderful to fellowship with you by CD every month, even if I can’t see you personally. I pray that this month’s message will be a great blessing to you.

Our website now has a new feature. It is called Prophetic Intelligence Briefing. We do Prophetic Intelligence Briefings on CD virtually every month after the sermon. But there is way more material than can be put on a CD. So I have decided to place this much-appreciated feature right on our website, and we’re going to try to update it very frequently. That way you can go to our website every day or every other day and get the latest Prophetic Intelligence Briefings right there online. Go check it out. There is a lot there already.

This month we have another very timely and sobering message. I have been earnestly praying about this message for some time, seeking the Lord to know how
to approach it. Our world is headed for a very serious crisis. A few short months ago we would have never imagined that an economic storm is right upon us. We are at a most critical moment. Central banks and governments around the world are desperately trying to manage it so that the fall is not all at once. Your life is about to change dramatically. But the important thing right now is to prepare for some of the most challenging circumstances you may have ever faced. You have no time to lose to get yourself ready. Jesus is coming very soon.

Before we begin, let us pray. Our Father in heaven, we are aware that the end is near. Terrible things are going to take place in this world. We are seeing the world being squeezed for natural resources, food shortages and economic difficulties in virtually every aspect of our lives. We are reminded that Jesus told us these things would happen. As the world faces want and famine, we pray that your people will be preserved and strengthened to meet the crisis with the faith of Jesus and the courage of our convictions. May we have a sense of the importance of following the Bible and Spirit of Prophecy counsel, and wisdom that we may know what to do. As we study today, please send your Holy Spirit to awaken us to the times in which we live and a longing desire for heaven. May He also inspire us to reach out to others that don’t know the truth. In Jesus’ name and for His sake, Amen.

Please turn with me in your bibles to Revelation 18:9-11. “And the kings of the earth, who have committed fornication and lived deliciously with her, shall bewail her, and lament for her, when they shall see the smoke of her burning, Standing afar off for the fear of her torment saying, Alas, alas, that great city Babylon, that mighty city! For in one hour is thy judgment come. And the merchants of the earth shall weep and mourn over her; for no man buyeth their merchandise any more…” and verse 15; “The merchants of these things which were made rich by her, shall stand afar off for the fear of her torment, weeping and wailing…” and vs. 17; “For in one hour so great riches is come to nought…”

My friends, the Bible predicts that there will be an economic collapse of nations. It will happen in one hour, or 15 days in prophetic time. We may not be quite there yet. But the judgment of spiritual Babylon, or Rome, will not only come upon her, but also on the men who control huge resources and economies, as depicted by the merchants of the earth, and government leaders, as depicted by the kings of the earth who have cooperated with Rome to control the wealth of the world. They will all be horrified by the judgment of Rome and by their own losses. The economies of the earth will be shattered. And the traders will suffer a great crisis because they are suddenly bankrupt. I want you to notice that the economies of the earth, behind the scenes are connected to Rome according to the Bible. We may not be able to see it, but it is surely there. A down economy increases stress and people look to their spiritual leaders for advice. This provides Rome a huge opportunity to promote her agenda of religious control through the economy.

The world is on an economic collision course. What we are feeling right now economically, is only the tip of the iceberg. Many analysts are saying that there is more pain to come – much more pain. Jobs are being lost by the hundreds of thousands world-wide. Real wages continue to fall in the inflationary environment. And this puts a ferocious squeeze on people in the grip of the credit crunch.
A colossal convergence of super-charged economic forces threatens to undo western economies and make life difficult world-wide. It is a “witches brew” of powerful forces that are aligning to make the depression of 1929 look like child’s play. These forces have been held under control for many years, in part by the efforts of central banks and governmental measures, and are now looming like a huge dark storm over the nations. Never before have so many elements converged together to create an such an economic hurricane. We are headed into the perfect economic storm. A perfect storm is when the combination of circumstances aggravates the situation drastically and at the most vulnerable point or moment.

Definition of Perfect Storm [2].

The London Telegraph reported on July 21, 2008 that “we are now at the point of maximum danger.” A global credit crisis, a huge and increasing federal deficit, inflationary pressure, declining consumer confidence, and much, much more, have united together to create a dramatic global inflationary trend that is not going to end anytime soon.

“Source of “Maximum Danger” article”:http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2008/07/21/ccview121.xml

Before we continue, let me share with you a very powerful statement from the Spirit of Prophecy. It is from Education, page 228. Speaking of the French Revolution, God’s messenger wrote; “The centralizing of wealth and power; the vast combinations for the enriching of the few at the expense of the many;… along with a list of other things “all are tending to involve the whole world in a struggle similar to that which convulsed France.” Please go and read the full statement carefully and thoughtfully. Also read the causes of the French Revolution in the book Great Controversy. This will give you considerable perspective concerning what is happening now.

Did you notice what Ellen White said is happening to the money? It is being organized so that vast combinations or consolidations are being developed so that the few can be enriched at the expense of the many. Economic downturns are a goldmine for those who control the economies. It helps the merchants of the earth consolidate control and power over economy. They can see it coming and can protect themselves from it. But they also take advantage of the economy at its lowest point to buy up assets that will make them rich as it recovers. But there is coming a time when it will not recover. This is what is spoken of in Revelation 18. I don’t know when that will be, but I believe it could be soon. The economic stress that we are seeing in the nations right now is a harbinger of times to come that are predicted in prophecy.

The world is currently facing an economic meltdown of unprecedented proportions. For years everyone seemed to think that nothing could go wrong. Economies were growing and expanding. People in many countries felt at liberty in such good times, to spend, spend, spend, borrow, borrow, and borrow some more. They became maxed out on their credit cards. They maxed out their mortgages, and put nothing in savings for a rainy day. But all of a sudden things have dramatically changed. The rainy days have come. What happened? How did we come so quickly to the precipice in just two years?

It didn’t happen quickly at all actually. The economy was being artificially propped up. About 15 years ago, the Federal Reserve, the U.S. central bank, began to loosen credit in order to stimulate growth. It was partly driven by political reasons and partly by globalist agendas. Other nation’s central banks liked the idea too and did their own versions of loose credit.

Now before I go on, let me read to you another powerful statement in the Spirit of Prophecy. It reads much like the morning newspapers. It comes from the second volume of Selected Messages, page 142. Here it is. “The work of the people of God is to prepare for the events of the future, which will soon come upon them with blinding force.” Does that sound like an overwhelming surprise? I’ll read on. “In the world gigantic monopolies will be formed. Men will bind themselves together in unions that will wrap them in the folds of the enemy. A few men will combine to grasp all the means to be obtained in certain lines of business. Trades unions will be formed, and those who refuse to join these unions will be marked men.” Notice that your work is to prepare for the crisis. You must follow the counsel in the Bible and Spirit of Prophecy if you want to survive. But let’s not get ahead of ourselves.
When the economy is going well, people don’t complain or resist government shenanigans so long as it doesn’t affect them much. For example, so long as people felt that they were doing well financially, the government could increase the national debt substantially, year after year, gutting the national economy, and leading its people to financial ruin, without much protest. The very loose fiscal practice has undermined the very wealth that people thought they had. The Government Accountability Office reported in January of 2007 that its “long-term simulations continue to show ever-larger deficits resulting in a federal debt burden that ultimately spirals out of control.” The report went on to say that “the longer action… is delayed, the greater the risk that the eventual changes will be disruptive and destabilizing.” In essence the GAO is saying that the current levels of spending in the federal government are unsustainable and that it will greatly effect the nation’s fiscal health. That prediction is now being fulfilled in the United States. But it is affecting the rest of the world.

GAO report [3]

During the same 15-year period of artificial expansion, the U.S. government was constructing trade agreements such as the North American Free Trade Agreement (known as NAFTA) and the Central American Free Trade Agreement (known as CAFTA). These were being implemented in an effort to consolidate economic and thereby political forces for regional control. The people were told that these trade treaties would benefit the economy when in fact they did the opposite.

NAFTA source #1 [4] , NAFTA source #2 [5]

Other trade policies made it less attractive to keep U.S. businesses in the country. These trade agreements caused the shift of large manufacturing and service industries to foreign nations like China, India and some countries in Latin America. This left a lot of people jobless in the United States, while many of the remaining manufacturing and service jobs were taken over by immigrants from Latin America.
Similar outsourcing policies were followed in Australia, Britain and other countries. The goal was to gradually weaken the economic strength of these nations so that they can be more easily manipulated into the economic, political and global order as the scripture suggests. Eventually people will be told that they need to let go of their independence; their rights; their freedoms; their sovereignty; and join the global order because it will help them economically. So while the good times rolled artificially, economic strength was undermined. When the bad times come, the people and whole nations may well be swept up in the new world order in the name of recovering from economic disaster.

U.S. Congressman Ron Paul recently gave a powerful speech before the House of Representatives. He said that a “Big Event” is about to unfold. “The world economy and political system will share in the chaos about to be unleashed,” he said. “There are reasons to believe this coming crisis is different and bigger than the world has ever experienced. Instead of using globalism in a positive fashion, it’s been used to globalize all of the mistakes of the politicians, bureaucrats and central bankers…”
“There are two choices that people can make,” he said. “The one chosen so often by government in the past is that of rejecting the principles of liberty and resorting to even bigger and more authoritarian government…” Ron Paul went on to say, “the more the government is allowed to do in taking over and running the economy, the deeper the depression gets and the longer it lasts. That was the story of the 30s and the early 40s, and the same mistakes are likely to be made again if we do not wake up.”

Congressman Ron Paul Speech [6]

This incredible speech makes it clear that the greatest danger is that a severe economic down cycle is likely to be used by government to become more authoritarian and consolidate economy, control and power in the hands of a few, thus removing more personal liberties. And this is exactly what is happening. On June 13, 2008, the Associated Press reported that “Treasury Secretary Henry Paulson said Thursday that the government must move quickly to give the Federal Reserve more powers to regulate the financial system… Paulson said that the central bank’s powers should be expanded in the wake of the near collapse earlier this year of Bear Stearns, the giant Wall Street investment firm. He said there was a need to consider quickly how to give the Fed the power it needs to obtain information from investment banks and the responsibility to intervene to protect the overall financial system…

Paulson did not spell out how the new powers should be provided. It is possible some actions could be made through administration decisions without the need for laws being passed…

Paulson’s comments echoed views expressed earlier this month by Timothy Geithner, president of the New York Federal Reserve Bank, who said in a speech that the central bank needs more authority over firms that may need financial support from the Fed in a crisis.

Wide New Powers for Treasury [7], Wide New Powers for Treasury [8],

Blueprint for Modernization of the Treasury [9]

Friends, this is nothing more than a power grab. Paulson wants to control the entire financial system. Consolidation of power, however well-intended, will eventually control the people more fully and remove their liberties. That is the very nature of consolidation of economic and political power.

And consolidation is happening everywhere. And it fits perfectly into the scenario of the last days as Revelation 18 suggests. When the economy slides into recession or depression, people feel the pain. They become fearful and anxious as their wealth slips away right in front of their eyes. This eventually makes them angry. Ministers tell them that the prosperity of the nation can only return if the nation returns to God. This means to most, being in church on Sunday and following certain key mandates that their church leaders suggest to them. If government leaders profess religiosity, they will respect them and also pressure them to legislate morality and support it with Sunday laws. These Sunday laws become more and more oppressive as the nation continues to sink into deeper financial distress. But the Sunday Laws only lead to national ruin.

Consolidation of power is very important to the coming new world order. As the pope tries to consolidate his power over the nations and the churches, nations are trying to consolidate control over each other. Europe is consolidating under the EU. It starts as an economic trade Union and ends with political and religious control over all citizens. This is also happening with gigantic trade consolidations such as the North American Union, the Mercosur nations in Latin America, the ASEAN nations of Southeast Asia, and now the Mediterranean Union spearheaded by French president Nicolas Sarkozy in July. These regional trade agreements are consolidating nations and economies in the hands of a few. Consolidation is a human principle that will ultimately rise up in opposition to the God of heaven. But it will have a powerful and devastating effect on the average citizen. It has been happening gradually so that people don’t overreact and panic and then become violent. That could eventually happen however.

Mercosur [10] , ASEAN [11] , Mediterranean , [12]

Notice this statement from the pen of inspiration. It is found in This Day with God, page 163; “The inhabitants of the world, under Satan’s leadership, are binding up in bundles ready to be burned.” And Maranatha, page 182 says “In the world gigantic monopolies will be formed.” While trade unions in the traditional sense are struggling to build their power, the other trade consolidations between nations known as trade agreements like NAFTA and CAFTA are also bundling the world together economically so that there can be centralized control, and thereby huge resources and power can be funneled into the hands of fewer and fewer people. This will lead to economic ruin.

Manipulating the economy is a prime way of centralizing control. But how did the current economic mess happen? In the mortgage industry there are mainstream banks who sell mortgages to prime borrowers with high-quality credit ratings. These mortgages have the best interest rates and lowest costs. If a borrower’s credit rating is too low, he is a subprime borrower and must go to a lender who will lend him money at a higher interest rate and higher costs. Subprime mortgages often have adjustable rates or a balloon payment after 2-5 years. Sometimes they even have a grace period in which the interest is less than prime but which, at the end of the grace period adjusts to a higher rate than prime. Subprime loans are much more risky and generate the majority of defaults.

Subprime Definition [13]

As more and more loose credit became available, people who were unqualified to take out home mortgages from mainstream prime lenders borrowed from subprime lenders. Huge numbers of subprime mortgages were sold exposing banks and mortgage companies to these risky loans. But things were going so well that it didn’t seem like it would ever cause any problems. Unemployment rates were low, inflation was low, energy costs were low. Thanks to the Federal Reserve’s manipulation of the financial markets, the good times were rolling.

People who bought homes from the subprime market also thought that everything would go well and that there would never be a problem. As more and more people bought homes on easy credit demand for homes increased and prices skyrocketed. This made the subprime mortgages more risky because now the personal debt load of hundreds of thousands of individual borrowers was much more because of the cost to purchase the overpriced homes. Overpricing of homes was known as the housing bubble and it got bigger and bigger as more and more people took advantage of the borrowing opportunities and easy access to funds.

Many articles in the press predicted the housing bubble would break and cause serious economic distress. That time has come. It is all happening now.
Banks have to lend money to make money. If people stop borrowing it creates a cash flow problem for banks. So banks and other mortgage lenders were making it easier and easier to borrow money in order to keep their profits rolling in. However, the quality of loans deteriorated because they were being sold to people with less than ideal credit. In order to keep their cash flow going so that the banks could lend more money (and thereby earn more interest), these subprime loans were sold to large mortgage investment companies who got money from their investors to buy them. They in turn, took a share of the interest, and since things were going so well, their investors reaped the benefits through increasing share values and dividend payments. The system worked fine while there was enough liquidity in the markets to keep the system expanding. Lenders were given approval to lend with lower reserves which made the lenders even more vulnerable to an economic downturn.

But expansion has to stop at some point. Everything has limits in this world. The housing industry began to slow in the U.S. partly because of the increase in the cost of fuel and other pressures. As more and more home buyers could not afford their newly adjusted mortgage rates and balloon payments on their sub-prime mortgages, problems in the whole industry began to surface. Mortgage lenders began to tighten credit standards to limit their exposure. This began the cycle of cash flow problems for lenders. They were between the proverbial “rock and a hard place.” If they loaned more money to risky borrowers, they increased their exposure to potentially bad loans. If they tightened their lending standards, they would seriously reduce their cash flow and thereby be unable to meet their obligations. Eventually, a serious crisis of confidence in the mortgage markets developed and this started the current economic woe.

The first major bust in the system occurred when Countrywide Financial Corporation, a huge mortgage lender that was heavily exposed to the risky subprime market could not meet its obligations. They had loaned so much money in shaky investments, or had bought and guaranteed subprime mortgages from other lenders, that when a large number of people began to default on their payments, they were unable to remain solvent. This sent shock waves through the financial sector. Eventually, Countrywide and Bank of America made a deal and Bank of America bought Countrywide for almost nothing.

Countrywide Financial [14]

The shock waves began to spread around the world. Banks in many western countries, particularly Britain and Europe had invested in the booming subprime home mortgage business in the United States and now they too were concerned about their exposure. The European Central bank infused a shocking 350 billion Euros (or $500 billion) into the EU financial system to steady 390 banks across the Eurozone that had requested the help. And the Bank of England dolled out 10 billion pounds to its banks to shore them up.

But Northern Rock, a major British lender of home mortgages ran into deep trouble quickly on the heels of Countrywide. It had been heavily exposed to the U.S. subprime crisis. After two unsuccessful bids to buy out the bank, the British government bailed them out by nationalizing them. Banks and other lenders were in trouble too, because as the housing market turned downward in the U.S., they had to cut the book value of their mortgage investments and desperately needed the cash to cover their losses and continue their operations. Then in Spain a huge real estate developer, Martinsa-Fadesa filed for bankruptcy on July 15, 2008 sending shock waves throughout the Eurozone. This company had debts of $7.9 billion. But the stresses are everywhere, including Australia, New Zealand, Asia, Europe as well as North America. ”A painful adjustment faces the global banking sector over the next few months,” said Mervin King, a governor of the Bank of England.

Northern Rock [15] , Euro Infusion [16] , Bank of England [17] , Martinsa-Fedesa [18]

Then the financial earthquake erupted. Bank after bank, lender after lender, including some of the most reputable investment firms, suddenly had to face huge write downs on the value of their assets. As confidence in the banking industry sank, so did confidence in the stock market. As the housing slump deepened and unsold home inventory soared skyward, confidence slid even further. Commercial bankruptcies soared. Huge retail chain stores shuttered hundreds of retail outlets, and there seems to be no end in sight.

Commercial Bankruptcies [19] ,
Retail Stores [20]

The Federal Reserve began lowering interest rates hand over fist in order to stabilize the financial markets and buy time so that the banks could try to get their financial houses in order. They only had a few months to solve their problems however – a near impossibility. The Federal Reserve also infused billions upon billions of new electronic dollars into the banking system to keep it liquid. Central Banks in Britain, Europe, Australia and other key nations followed suit.

The infusion of cash in the U.S. to shore up the banking industry did two devastating things; first it massacred the U.S. dollar, which began a gradual but steady decline against other currencies like the Euro and the Australian dollar. But it also fueled inflation, for as more instant dollars circulated, the value of all the rest of the dollars was depreciated. This directly effects consumers because their money buys less and less, as more and more money is injected into the financial system. Imports become much more expensive as a result of the weak dollar. Coupled with the increasing cost of fuel, prices of commodities as well as the end product that is produced from them soared. This hit the poor and middle classes the hardest. The days of cheap travel came to a screeching halt as the airline industry went from marginal profitability after clawing their way out of bankruptcy, to huge losses in a matter of months, largely because of fuel prices.

Then a huge financial institution teetered on the brink of bankruptcy. Bear Stearns Companies Inc. was one of the largest global investment banks and securities trading and brokerage firms in the world. From 2005-2007, Bear Stearns was recognized as the “Most Admired” securities firm in Fortunes magazine. Its stock once traded at $172 per share. The rapid decline in the subprime market and the growing credit crisis exposed serious flaws in the company and badly damaged Bear Stearns. In March of 2008 things had gotten so bad that the Federal Reserve, fearful that the collapse of Bear Stearns would bring the whole market down, took the unprecedented step of making an emergency loan in conjunction with J. P. Morgan, a rival investment firm to keep them solvent. Keep in mind, the Federal Reserve had never before made loans to non-bank financial institutions. This of course, added billions more dollars into the market. Eventually the Federal Reserve brokered a deal in which J. P. Morgan bought the whole company at a fire sale price of $10 a share and narrowly escaped a serious financial meltdown.

Bear Sterns [21]

But that wasn’t the end of it. By July 2008, the damage to the financial sectors continued to mount. As deterioration spread, concerns were raised by Senator Charles Schumer on June 26 concerning a large California lender. The Los Angeles Times on July 12, 2008 reported his words about IndyMac Bank, based in Pasadena. “I am concerned that IndyMac’s financial deterioration poses significant risks to both taxpayers and borrowers,” he wrote. The bank “could face a failure if prescriptive measures are not taken quickly.”

Between June 26 and July 11, as word got around that the bank might fail, people with accounts at the bank began to withdraw their money, and quickly. In those few short days, over $1.3 Billion was withdrawn from the bank. That is a rate of about $100 million a day. Imagine what that does to a struggling bank! It pushed IndyMac over the precipice. IndyMac lost it ability to meet its obligations very quickly. The LA Times said that regulators called it “the second-largest bank failure in U.S. history,” second only to Continental Illinois Bank which went belly up in 1984.

On Friday July 11, Federal Regulators entered the main branch of IndyMac bank and closed it three hours early. Over the weekend the Feds reorganized IndyMac and opened it on Monday as a federal bank. While deposits under $100,000 were protected by FDIC insurance, the cost of the bailout by the Feds was between $4 and $8 billion – probably closer to $8 billion – more than 10% of the FDIC’s $52 billion in reserves.

“This institution failed today due to a liquidity crisis,” [said] John M. Reich, director of the [Office of Thrift Supervision in Washington]… “Although this institution was already in distress, the deposit run pushed IndyMac over the edge.”
In a shocking article, Reuters on July 13, 2008 said that “more than 300 banks could fail in the next three years.” The Fed had at the end of March only 90 banks on its list of troubled or “problem” banks, which by the way did not include IndyMac. So the official data does not reflect reality.

Source #1 [22] , Source #2 [23]

As IndyMac’s troubles were being addressed by Federal Regulators, another serious problem surfaced. Fannie Mae and Freddie Mac, two huge congressionally chartered mortgage lenders, who own 40% of all U.S. mortgages, approximately $4.4 trillion were suddenly in the news. Fannie and Freddie are designed to guarantee mortgages to banks that lend to low-income families. They work in the background behind the banks and other lenders. Pension funds, insurance companies and foreign governments invested in these two companies. They were heavily exposed to the risky subprime market by their very nature. Their liquidity was stretched so thin that the federal government stepped in to address the problems. “On July 15, 2008 Treasury Secretary Henry M. Paulson Jr. asked the U.S. Congress for unlimited authority to lend to them to reassure markets of their creditworthiness,” said Business Week July 16, 2008. Nobody wanted to buy the debt any more. One banker said that they are afraid because the debt “could be full of rat poison.” The toxic elements now in the subprime mortgage industry have caused an enormous slowdown of liquidity in the markets, causing great stress to banks and homeowners. The troubles at Fannie and Freddie caused mortgage rates to rise which added to the pressure.

Fannie Mae and Freddie Mac (Source #1)”:http://www.answers.com/topic/federal-national-mortgage-association , Fannie Mae and Freddie Mac [24] , Fannie Mae and Freddie Mac [25] , Fannie Mae and Freddie Mac [26] , Fannie Mae and Freddie Mac [27].

As people stopped buying homes because of the credit crisis and inflationary pressures, inventories for all types of homes increased to 4.59 million nationwide, a record 12 months supply. The inventories continued to increase. This greatly increased the stress on the financial markets, on builders and developers, and on individuals that had loans that were too much for them to handle. They couldn’t even sell their homes to pay back the bank, and had to let the bank foreclose. Some people have even been sleeping in their cars and SUVs in parking lots because they have no place to go.

Home inventories [28] , See Also [29]

At the same time as all this financial stress was going down, demand for natural resources, most noticeably petroleum products, soared to record highs because of new demand from China and India. As fuel increased, so did prices of everything else, especially, food. In addition, there was a tremendous new demand for copper, zinc, plutonium, uranium and other key commodities worldwide which substantially drove up costs of building.

Almost every commodity in existence including food, precious metals, energy and even water are surging in price because they are in short supply. “In the past year,” according to the investment newsletter Money and Markets, June 19, 2008, “peanut butter is up 9%, dairy prices are up 12%, eggs have shot up more than 30%, and flour is up an astounding 46%! In just the last two weeks, the price of cocoa is up almost 7% and sugar is up about 6.2%!

“…Corn prices have soared 58% since the first of the year… Wheat prices are up almost 13% so far this month. And soybean prices are on ‘a tear,’ up 18% in barely four weeks. As a result, a loaf of bread is up 17%.

“Transportation costs are up 8.1% over the 12 months ending in May. Gas prices were up 5.2% in May, 21% compared to a year earlier. And airline tickets last month were up 3.2%, their largest gain in more than six years.”

Add in another critical factor. As I prepare this sermon, a barrel of oil costs over $130. Oil and its related petrochemicals are part of the manufacturing process of almost everything you buy. Petro-products are included in the production and/or manufacture of everything rubber and plastic, clothing, medicines, and food. When the cost of oil soars, that affects much more than the prices at the pump. It also effects the prices of everything you buy. In addition there is the oil needed to heat or cool your home, run your cars, lawnmowers and anything else with a motor, as well as commercial travel.

And don’t forget that the falling value of the dollar has added to the inflation and the cost of imported goods. This vicious inflationary cycle has become a major global force and threatens to undo your life, your goals, your plans and virtually everything about your future including your retirement. It is hard for people to believe, but as the last vestiges of their former lives are left behind, they are very concerned even frightened. The reason is simple: too few dollars chasing too few goods including natural resources. Gone are the days of cheap travel. Gone are the days of inexpensive food. Gone are the days when you could depend on your job, your bank account, your home equity, or anything else… And people are hedging. They are selling their gas-guzzling trucks and SUVs (though at a great loss). They are constricting their major purchases to only the things they actually need. And they are changing their eating habits, cutting the luxury foods, the restaurant meals and turning to more basic and simple fare. And all this is hurting businesses who are laying off workers right, left and center and closing store fronts and backroom operations further compounding the economic contraction. It is a vicious cycle.
Because of the many aggravating circumstances, a perfect storm looms over the world economy. Rumors abound on the internet that there will be a collapse of the U.S. economy in September or October. If this should happen, it will ricochet through the economies of every other nation large and small, developed or not.
The Bible says in James 5:1 “Go to now, ye rich men, weep and howl for your miseries that shall come upon you. Your riches are corrupted, and your garments are motheaten. Your gold and silver is cankered; and the rust of them shall be a witness against you, and shall eat your flesh as it were fire. Ye have heaped treasure together for the last days.”

Let us talk about personal consequences for just a minute. The subprime crisis in the United States has burst the bubble that was artificially supported by real estate prices and the easy money from the central banks through the mortgage industry. Agonizingly, it threatens to strip the homes out from underneath hundreds of thousands of families worldwide. As home prices continue to tumble in the U.S., Britain, Europe, Australia and elsewhere, families are squeezed so hard that they have been forced to let the banks repossess them. Families who have no reserves are vulnerable to the sudden increases in gas and food prices because their lives were based in an environment with much cheaper cost of living. Think of the stress and distress of dealing with these kinds of problems. The many years of reckless spending, accumulation of debt with virtually no savings is now coming back to haunt many Americans and others. This will eventually have an impact on all nations. They are halting the spending which in turn is affecting every other economy in the world to one degree or another.

Source [30],

We are watching an incredibly important prophetic development that most people cannot comprehend. But we are told that those that are wise shall understand (Dan 12:10) and they will be ready because they are wisely taking steps to harmonize their lives with all the counsel of the Lord. What is the counsel of the Lord? What should God’s people do? The Spirit of Prophecy says in Country Living, page 26 that “To understand the will of God is a great thing.”

It is time to take careful stock of your situation and think about the coming difficulties. If you do not, you could be overwhelmed in the perfect storm that will break upon the world. Jesus told us about it so that we could prepare spiritually and temporally. So what should we do? The Spirit of Prophecy gives us plenty of counsel. Get the little book Country Living and read it.

Here is just one statement from page 20 that explains why we do not want to live in the cities. Here it is; “We are not to locate ourselves where we will be forced into close relations with those who do not honor God… A crisis is soon to come in regard to the observance of Sunday… The Sunday party is strengthening itself in its false claims, and this will mean oppression to those who determine to keep the Sabbath of the Lord. We are to place ourselves where we can carry out the Sabbath commandment in its fullness… If in the providence of God we can secure places away from the cities, the Lord would have us do this. There are troublous times before us.

It is in the cities where the greatest troubles will be. They will have serious problems including unprecedented violence as the shortages and economic problems mount. There could be lockdowns and other difficulties that we can hardly imagine right now. Think of the food shortages that are now likely; or even fuel shortages that would make it difficult to get food and other things to the stores. But it is also where the focus of Sunday Law enforcement will be. God’s people don’t need to be in the city. Remember that it is in the country where you can grow and preserve our own food best. If you live in the city, pray that the Lord will help you now to relocate. In the mean time, you can learn to can and preserve produce so that you will have it when you cannot buy or sell. It is a good practice anyway. If you live where you can grow a garden, even in the city, it will help you learn how, so that you can have things available to eat and you don’t have to purchase the high priced stuff in the stores.

God also gives us clear counsel about our finances. After we have secured our country property, we are to invest in the bank of heaven where moth and rust doth not corrupt. Matt 6:19-20 is a warning about what is going to happen to your wealth if you don’t put it in the service of God. “Lay not up for yourselves treasures upon earth, where moth and rust doth corrupt, and where thieves break through and steal; But lay up for yourselves treasures in heaven, where neither moth nor rust doth corrupt, and where thieves do not break through nor steal. For where your treasure is, there will your heart be also.”

This important economic counsel is so very relevant today. This is not saying that you should not have a modest home on land where you can live. Nor does it mean that you should not have sufficient funds in the bank to pay your bills for six months or so. It is saying that we should not have unnecessary extras.

There is more counsel in the word of God. If you want the blessing of God during economic challenges, follow the financial counsel found in Malachi 3:8-10. “Will a man rob God? Yet ye have robbed me. But ye say, Wherein have we robbed thee? In tithes and offerings. Ye are cursed with a curse: for ye have robbed me, even this whole nation. Bring ye all the tithes into the storehouse, that there may be meat in mine house, and prove me now herewith, saith the Lord of Hosts, if I will not open you the windows of heaven, and pour you out a blessing, that there shall not be room enough to receive it.”

These verses reveal the reason why we will suffer economic distress in times of trouble. It is because God sees our unfaithfulness in tithes and offerings. My friends, if you want to have economic survival and abundance, follow the counsel of God. Put your extra funds beyond your needs into the cause of God. Send it where the truth is being preached. And God will show you His power to sustain. Many have neglected to return a faithful tithe and offerings for one excuse or another. He tests us in this. He shows us our selfishness by requiring tithes and offerings. If we would trust God in this, He will make sure that we have more to give to His cause. He may not always send us cash. There is coming a time when commodities are going to be more valuable than cash by far. So be thinking and praying about these things.

Also, focus on learning to live a godly life. Your heart must be drawn out to God in prayer for His wisdom and guidance. Preserve your sacred influence so that you can help others come to the knowledge of the truth. Build your spiritual resources so that you can witness to anyone anywhere.

My friends, there is a much greater terror that is approaching the world than the economic problems we now face. God’s church needs to get ready. We are living in the time of anticipation. But the coming reality will truly surprise us. Keep your lamps burning. Let your life be hid in Christ. Take God’s counsel to heart in every area of life. Do whatever you have to do, but do it carefully in His wisdom. Let Christ rule your life so that He will empower you to stop sinning. That way you can hear His still small voice, and follow in all His ways.

Let us pray. Our Father in heaven, we want to be like Jesus. Please send your Holy Spirit into our lives that we may reflect the character of Christ. Lead us and show us what we must do to get ready for the coming economic crisis. Help us recognize the signs of the times for what they are and may we heed the warnings that Jesus has given us. Thank you for your love and watch care. In Jesus name amen.


We hope you have received a rich blessing from this month’s message. Your prayers and gifts mean much to us. Thank you for your support. The song you have just heard is I Need Thee Every Hour, sung by Christian Berdahl. It is recorded on a CD with other beautiful hymns called Consecration, Hymns of Devotion. If you would like to have a copy of the CD, just send $16 post paid to U.S. addresses to cover the cost, and we will send you one. Please mention the¬ Consecration CD. Our international listeners should inquire the additional cost of shipping.

The following is our monthly Prophetic Intelligence Briefing, a feature that brings you current events in light of prophecy especially for those who love the appearing of Jesus Christ. We can see the signs of the times telling us that we are nearing the world’s great crisis. May the Lord find us faithful.

Our first item this month, Freedom of Speech Under Assault in Canada

“In 1999, reported the National Catholic Register July 6, 2008, the Ontario Human Rights Tribunal ordered Evangelical printer Scott Brockie to pay a $5,000 fine after he refused to print homosexual-themed stationary.

“In April (2008), Christian Horizons, a Christian ministry that cares for the severely disabled, was find $23,000 by the Ontario Human Rights Tribunal for dismissing an employee who had signed a declaration of Christian moral living as part of her employment contract, but who later assumed an active homosexual lifestyle.

The paper also reported that a Knights of Columbus chapter in British Columbia was fined $2,000 in December (2005) for declining to rent its hall to a lesbian couple for a same-sex ‘marriage’ ceremony.

Now, a priest who publishes a Catholic magazine is being investigated under the hate speech clause of Canada’s Human Rights Act, for publishing several articles “critical of homosexual activists attempting to redefine marriage to include same-sex unions. “Some of the allegedly hateful statements cited in the complaint were quotations from recent papal encyclicals and the Catechism of the Catholic Church,” according to Father [Alphonse] de Valk, the priest being investigated.

So far, “Canada’s human rights tribunals have a 100% conviction rate when investigating complaints filed against Christians by homosexual activists…”reported the Register. Under the Human Rights Act, section 13.1 defines hate speech as “’any matter that is likely to expose a person or persons to hatred or contempt by reason of the fact that that person or those persons are identifiable on the basis of a prohibited ground of discrimination. ‘Sexual orientation’ is one of the grounds of discrimination prohibited by the act.’”

Canada’s Human Rights Act is vaguely worded so that it is easy for homosexual activists and activist human rights tribunals to overzealously apply the law to restrict religious speech on some sincerely held beliefs. Speech that should be protected is now exposed to legal action in Canada which jeopardizes freedom of speech which is also a human right in Canada. Those that have to legally protect themselves from criticism by using a tortured definition of hate speech, have a very weak persuasive case. Could the Human Rights Act one day misconstrue the text of the book Great Controversy which identifies the Catholic Church as the anti-Christ as hate speech? Given time, and the right climate, it is entirely conceivable. Hate speech laws have been in the development state in a number of western countries for a long time. Now we are beginning to see their effect in restricting religious speech. Islamic countries often restrict speech against Islam or Mohammed in most intolerant ways and even brutal ways. Will western countries eventually adopt similar attitudes in restricting freedom of speech? Canada’s human rights law suggests that it is entirely possible.

Next: Churches Join Episcopalian Fight with Breakaway Churches.

Sixteen Protestant denominations, including the General Conference of Seventh-day Adventists, have “joined a friend-of-the-court brief supporting the Episcopal Diocese of Virginia in contesting a Reconstruction-era state law that governs church splits,” reported Christianity Today, July 2008. “The post-Civil War splintering of the Methodist and Presbyterian churches in 1867 prompted the Virginia law, which allows congregations to keep their property when seceding from a church or ‘religious society’ that’s dividing.

Eleven theologically conservative congregations left the Episcopal Church to join the Nigerian Episcopal Church sponsored Convocation of Anglicans in North America. This has resulted in multimillion-dollar battles over church property. The protestant amicus curiae brief argues that the law is unconstitutional in that it draws the government into fundamentally religious questions. The General Conference of Seventh-day Adventists along with some of the other protestants also argue that local congregations hold their property, including bank accounts, in trust for the hierarchical organization.

It hasn’t always been that way – at least in the Seventh-day Adventist Church. Most Adventists don’t have a memory that goes back far enough to remember the time when local church property was held in a local trust. It was not held in the conference association or any other legal entity controlled by the conference. Many years ago, Conference officials argued that property could be lost if the local trustees were unfaithful and urged, then eventually required all church entities to place their property in the hands of a conference controlled organization. Never in their wildest imagination did members think that one day there could arise leaders who would take the church in a liberal direction both in theology and in practice just as has happened in the Episcopal church, thus placing all the property held by conference entities in control of liberals who take it in a direction away from truth and righteousness. If the Virginia court rules in favor of local congregations, this could jeopardize legal precedents in other places that have been hard won by the General Conference and other denominations. Hence they have a vested interest in the outcome of the Virginia case, which, according to Christianity Today, “is expected to take years to settle.”

Next: Overstepping Judges

The July 21, 2008 Forbes magazine ran an editorial that made an important observation. “For decades,” wrote the author, “judges in U.S. courts, high and low, have been behaving like legislators, making laws as they see fit. The Supreme Court , for example, recently ruled that Louisiana could not execute a man for raping his very young stepdaughter, thereby overturning similar laws in five other states. The Justices rationalized their ruling by saying that there is “a national consensus” against applying capital punishment to such a crime.”

Since when does “national consensus” become the determining factor in judicial decisions? What happened to the elected legislative bodies? More importantly, what happened to the constitution? Do judges now have the right to consult opinion polls before rendering decisions?

Here is the prophetic question. If a “national consensus” can be used as a basis for deciding questions of constitutionality or validity, then the United States is in big constitutional trouble. It is essentially nullified. Nothing is safe; not the right of free speech; not the freedom of the press; not the right of a trial by a jury of peers, not the right to hold private property; and the list goes on and on. Already the Supreme Court has ruled that the right of eminent domain can be used to take private property from one entity and give it to another private entity.

Most importantly, the constitutional principle of the separation of church and state is no longer guaranteed. Neither is freedom of conscience, if “national consensus” can trump the constitution and the bill of rights. When the “national consensus” pressures lawmakers to make a Sunday law, what is to stop judges from upholding it in spite of its unconstitutionality?

Next: California Judges Authorize Gay Marriage

If “consensus” drives some judicial decisions, activism drives others. The California Supreme Court on May 15, 2008 overturned a state law prohibiting same-sex marriages. The court elevated sexual orientation to the same kind of status as race and gender. Calling it a “suspect classification,” the court said that the “traditional marriage referendum” according to Christianity Today, “passed by more than 60 percent of Californians in 2000” was discriminatory and therefore unconstitutional.

The implications of this ruling are very broad. Gay couples quickly “tied the knot” as soon as the ruling went into effect. But the serious implications cover all sorts of areas. “’Together with the state’s Unruh Civil Rights Act,’ wrote Christianity Today quoting a law professor,’it would be hard to see how government or private business could make distinctions legally on the basis of sexual orientation in any area covered by Unruh – [including] public accommodation, housing, nonprofit groups, public agencies, retail establishments, hotels, motels, restaurants, theaters, hospitals, barbershops, etc.

Next: Croatia Enacts a Sunday Law

On July 15, 2008 the Associated Press published a report from Zagreb, Croatia that “the Croatian parliament has passed a law forcing shops to close on Sundays in a concession to the Roman Catholic Church. The Church has campaigned for years for Sundays to be devoted to family or Mass in Croatia, which is almost 90 percent Roman Catholic. But Croatians have begun spending weekends in shopping malls that have flourished across the country in the past few years and remain open seven days a week.

The law goes into effect Jan. 1. It allows Sunday shopping over the summer and Christmas holidays. The law also allows stores in gas, bus and train stations to open on Sundays year-round, along with those in hospitals. Bakeries, newsstands and flower shops are also exempt from the ban.
While this is not the worst type of Sunday Law, it is a prelude to stronger and more comprehensive Sunday laws. One day these kinds of laws will lead to Sunday worship laws.

“In homage to the Papacy the United States will not be alone. The influence of Rome in the countries that once acknowledged her dominion, is still far from being destroyed. Maranatha, page 188.

Source [31]

Next: New Jesuit Superior General

On Saturday, January 19, 2008 the Jesuit order, during its general congregation elected Father Adolofo Nicolas, S.J. as its 13th Superior General, succeeding Peter Hans Kolvanbach. Nicolas, a Spaniard, will preside over the entire congregation of more than 19,000 members, according to the Jesuit article on Wikipedia, as the “black pope” (as the position is often called). Pope Benedict XVI confirmed his nomination.

Nicolas earned a masters and doctoral degree in theology at the Pontifical Gregorian University in Rome. He worked for the society in Asia, particularly in the Philippines and Japan. For a period of time, he controlled the Jesuits in East Asia and Oceania which included Australia, China, Japan, Korea, Micronesia, Myanmar and East Timor as well as the Philippines.
It is interesting to note that the new General was elected on the Sabbath, perhaps of symbolic interest to Sabbath keepers. It is also interesting to note that the new General is a Spaniard. The people of Spain have always been very strongly Catholic, even though a secular government sometimes gets into cross purposes with the church. Being a European, Nicolas will no doubt assist the pope in bringing Europe back to its Christian religious roots. Father Paolo Molinari, Postulator General of the Society of Jesus stated: “In regard to his kind of formation and the service he has done, he seems precisely to respond to the indications of the Holy Father, Benedict XVI. Certainly he will help us to rediscover and reinforce the Christian roots of Europe and to witness to Christ in the whole world.” Father Molinari also said he was the “optimal choice” for the position as Superior General.
The Jesuits were founded by Ignatius Loyola in response to the Reformation. They very quickly became masters of the educational system of Europe. Today they are still strongly involved in Education around the world promoting Roman Catholic ideals, philosophy, teachings and power.

“Under various disguises the Jesuits worked their way into offices of state, climbing up to be the counselors of kings, and shaping the policy of nations.”
Great Controversy, p. 235.

Next: America bankrolls the Vatican

Religion News Service, on July 9, 2008 reported that: “No nation of Catholics gives their church more money than Americans do, a fact universally (though sometimes grudgingly) acknowledged in Rome. Yet Vatican finances have begun to suffer from America’s recent economic troubles.

“A cardinals’ advisory committee on Holy See finances released a report today showing that the U.S. was the top contributor nation ($19 million, or 29% of the total) to the Holy See’s charitable spending in 2007, and came in second (after Germany) in contributions to the support of the Holy See itself.

“But the Holy See was only €1.4 million in the black for 2007, compared to €13.7 million for the previous year, mostly on account of the feeble dollar (a currency in which the Holy See evidently holds a large position).”

Source [32]

Next: Another Monkey Wrench in the Lisbon Treaty

This time it’s Poland. After the Irish voted no to the Lisbon Treaty, effectively vetoing the latest EU attempt at federalization. Poland’s president Lech Kaczynski has said he will not sign it, even though Poland’s parliament has approved the contentious treaty.

The Lisbon Treaty is a watered-down version of the European constitution. Ratification of any treaty or constitution requires unanimous approval of all member states. Most nations of the EU have not submitted the treaty to popular referendums because the leaders know that the idea of a federalized constitution is quite unpopular with the citizens of the European Union nations. But Irish law requires a referendum, hence the Irish vote.

But Poland was expected to ratify the treaty. Poland, unlike some of the other EU nations, is not that concerned about the fact that the European Union is really an attempt to resurrect the old Holy Roman Empire with most of its Roman Catholic institutions. They are a predominantly Roman Catholic country. However, the Polish president has his own political reasons for refusing to sign the treaty. Kaczynski is concerned, according to Stratfor (July 1. Poland: Another Nail in the Coffin of the EU’s Lisbon Treaty) that the Treaty would disproportionately distribute voting power toward Germany and France.

“Poland,” wrote Stratfor, “has taken the lead among the Central European states in vetoing any form of an EU constitution or treaty. Its concern about the Lisbon treaty is the same one it had about the constitution: that the voting system would give certain countries, such as Germany, a larger say in EU affairs, leaving Eastern and Central European states more vulnerable not only to those countries, but also to their increasingly powerful neighbor Russia. Most Eastern and Central European states know that most of their Western European neighbors are not as concerned with the resurging Russia – nor do they have deep memories of being under the Iron Curtain. Kaczynski does not see the European Union as a protector from Russia and has instead turned to the United States as a security guarantor.
“Kaczynski also wants to make sure Poland retains the power to shift and mold EU policies pertaining not only to Europe, but also to relations with Russia – and that all EU decisions are not left up to French or German agendas.”

The Prophet Daniel said, “they shall not cleave one to another, even as iron is not mixed with clay” Daniel 2:43 It is very hard for European’s with their many and varied, and often conflicting interests to unite under a central government that would control to a large extent their destiny. Yet the Prophet John says that the deadly wound would be healed and that all the world would wonder after the beast (Rev 13:4). Roman Catholicism will again rise to the heights of power. Whether or not the resurrection of Rome’s power is in the context of a federalized EU remains to be seen. If the European Union is eventually successful in achieving a constitutional form of government, it will be done by less than honest means and the bureaucrats in Brussels will find a means to arrange it in spite of the objections of the people.

French President Nicolas Sarkozy has vowed to work for another Irish vote with a different outcome. The fight over Europe’s soul is still on.

Next: High-profile Muslim Baptized Personally by Pope

On Saturday March 22, 2008, the day before Easter, Pope Benedict XVI baptized into the Catholic faith a well-known Muslim. Magdi Allam, an Egyptian, 55, is the deputy editor of one of Italy’s leading newspapers. This high-profile baptism is sure to stir deep feelings among Muslims. They may even see this as another provocative act.

Allam points to a personal contact with the pope that led to his conversion. Catholic News Agency reported that “Allam says that the most decisive factor was his meeting with the Pope ‘whom I have admired and defended as a Muslim for his brilliance in presenting the indissoluble link between faith and reason as the foundation of true religion.’

It is interesting to note that Allam praised the link between reason and faith as one of the reasons for leaving Islam and joining Rome. If Islam’s more radical elements continue to pursue violence as a means of promoting their religion, perhaps many more Muslims will find Rome’s teaching as an attractive alternative. Perhaps Rome stands to gain much by way of conversions in the future, as Muslims consider Allam’s reasons for his decision.

The baptism comes at a time when 138 Muslim scholars are negotiating and preparing for dialogue with the Vatican. One of the spokesmen for the Muslim scholars objected to the baptism and even referenced Benedict’s provocative statements at Regensburg, Germany. Father Lombardi S.J. a Jesuit Vatican spokesman was quoted by the Catholic News Agency as saying that the “We do not think the Church today merits the accusation of lack of respect for the dignity and freedom of the human person… Perhaps the Pope accepted the risk of this baptism also for this reason: to affirm the freedom of religious choice which derives from the dignity of the human person.” The end result of these events on the Islam/Catholic dialogue remains to be seen. Stay tuned.

Source #1 [33]
, Source #2 [34] ,
Source #3 [35].

Next: Surveillance Bill Passed by U.S. Congress

After breaking the law, and after long debates in congress over many issues, President Bush got what he wanted, at least to some extent. On July 10, 2008, the Associated Press reported that the Senate passed a hotly debated surveillance bill which the house had passed earlier giving the government wider authority to wiretap American citizens without a warrant from the secret FISA court.
“Bowing to President Bush’s demands, the Senate approved and sent the White House a bill Wednesday to overhaul bitterly disputed rules on secret government eavesdropping and shield telecommunications companies from lawsuits complaining they helped the U.S. spy on Americans.

“The relatively one-sided vote, 69-28, came only after a lengthy and heated debate that pitted privacy and civil liberties concerns against the desire to prevent terrorist attacks. It ended almost a year of wrangling in the Democratic-led Congress over surveillance rules and the president’s warrantless wiretapping program that was initiated after the Sept. 11, 2001, terrorist attacks…

“The long fight on Capitol Hill centered on one main question: whether to protect from civil lawsuits any telecommunications companies that helped the government eavesdrop on American phone and computer lines without the permission or knowledge of a secret court created by the Foreign Intelligence Surveillance Act.”
“The White House had threatened to veto the bill unless it immunized companies such as AT&T Inc. and Verizon Communications Inc. against wiretapping lawsuits.”
Sadly, this surveillance law now gives the U.S. government authority to spy on its own citizens without much court oversight, little as it was. While this is intended to be used against terrorists, it will certainly be used against new targets in the future, perhaps even those who break other laws. Could it one day be used against those that break man-made Sunday laws?

None of your telephone phone calls or cell phone calls, emails, and other communications will be off limits under the new law.

Source [36]

Unfortunately, our time has run out. It has been a great pleasure to spend this time with you. I hope you have been encouraged to live for Jesus for we are near the end. Thank you for your prayers and support. And until next time, may God bless and keep you and your family in His loving and protecting care. Keep the faith!