Marc Faber, a well-respected market analyst, made this prediction on CNBC's Fast Money Halftime Report last week. The Euro is deflating (trading at $1.24), Greece is about to go belly up, China is slowing down (I've been reading for some time now that China's growth is real, but its uber growth is a bubble that is near bursting brought on by artificial government stimulus). India is still a country in economic struggle (Rupee to Dollar is trading at 56 to 1, the highest I've ever seen) and while the top end is doing well, the other 800 million inhabitants are mired in poverty. The Global Financial Crisis of 2008 was dealt with by pushing serious issues down the road and it looks like it is possible that Part II is coming up.
Now, we see that Spain is in trouble, as is Portugal, Ireland, and Italy. The American housing market still has not bounced back and we got numbers this week that new home sales had declined again. With governments having maxed out their credit cards to get us through 2008, what happens if things turn south again? How do we bail ourselves out next time.
I read an article the other day that said that by 2024, 100% of U.S. tax dollars will be spent on entitlements such as Social Security, Medicare, Welfare, etc., and interest on the national debt, which will go up approximately $1.5 TRILLION this year alone. That means that there will be nothing left for the military, public works projects, student loans, or anything else the government spends money on. If we go through another recession in the next 12 months on a global scale, our financial situation will just become worse instead of better, possibly moving that date up a few years. Also, Baby Boomers are hitting retirement age and many of them cannot retire because they did not save, spent everything, and are in debt. So, they have to keep working and many are moving into jobs that would be considered entry level with lower pay just to make things meet. The problem is that they are keeping younger workers from being able to enter the workforce and move up, retarding their economic growth and ability to buy homes, increase assets, and contribute to a faltering economy and tax base, which just amplifies the looming entitlement funding crisis due to hit in about a decade. With unemployment continuing to be high and it getting harder to find work (saw today that 20,000 people applied for around 800 jobs at a local Hyundai plant), what are people to do? Go to college? Even that does not help as 53% of college graduates under the age of 25 are either unemployed or underemployed (working jobs that do not require a bachelor's degree). Perhaps things feel like they have stabilized, but in reality, the bottom seems to be getting weaker.
What is the Christian to do? IF all of this is true and we are headed for real economic recession again, then that means that there will be a lot of hurting people. Many will lose jobs, lose homes, and lose hope. We went through this just four years ago and were able to stave off the worst of it, but what if that was just the warning shot? What if things get really bad? Individual Christians and churches need to be getting their house in order so they can be a blessing to others instead of a drain. We can only put our hope in God and should not look to our jobs, our wealth, our education, the economy, or our nation for safety and security. When everything seems to be falling apart and the ground beneath us is shaking, we are to look to the Lord. Also, we must seek to be a help to those in need with the help that we have received from the Lord, both in strength, faith, and peace of mind, as well as in material blessing.
1 My soul finds rest in God alone;
my salvation comes from him.
2 He alone is my rock and my salvation;
he is my fortress, I will never be shaken.