Apprentice 2 Jesus

Thoughts on the Economic Crisis

As a pastor and financial advisor, I find myself more glued to the current economic situation and sorting it out with all kinds of paradigms.

An article I read by some Time reporters spurred my thinking some more. They were very cutting in their analysis of the current situation. For the most part, I found them to be right.

Some observations:

First of all, how is that we are so good at making an analysis after the fact? We look at all these factors and go, “DUH!” It’s so obvious! Yet, we marched right into this mess.

Basically, the writers in the Time article blamed Wall Street firms, credit rating firms (like Moody’s), the Bush administration (of course), hedge funds, mortgage lenders, AIG, and Ronald Reagan. (Just kidding on that last one.)

As to all the other parties listed, I would say, “I agree.” Wall Street firms got greedy, just like they did with technology in the late 90’s. Just like they did with leveraged buyouts in the 80’s. Just like they did… Okay… get the picture there?

Credit ratings firms did not fully understand these silly mortgage instruments made up by mortgage companies and sold off. They did not rate them correctly in the first place, so investment banks, not checking into those silly little instruments, either, bought them up seeing a good credit rating from the likes of Moody’s. BAD MOVE!

The current proposed bailout (along with a strong refusal to bring regulation into some areas that badly needed it) is where they blame the Bush administration. Look, everyone is blaming Bush for everything. This isn’t new. They’ll try to nail him for the Kennedy assassination somehow. However, I personally do not favor the current bailout proposal and think this constant government assistance idea for major corporations will only drag down the average taxpayer a lot more than necessary.

So, if all those entities are to blame, who did they leave out?

US.

Joe Taxpayer. Josephine Taxpayer.

We who looked to leverage every last dollar of equity in our homes. We who kept accepting those silly credit card offers in the mail, then promptly racked them up to the limits. We who believed the economy could only keep going up, so we spent like it, but had no savings to back it up.

Now, we are raiding our 401k plans to live today. We WOULD take out a line of credit on the house, but our house valuations have tanked and we’ve leveraged it to the hilt already.

At every level GREED has raised its ugly head and we have patted it. We have fed it. Every level. Now, we are paying for it at every level.

We need to ask forgiveness for living outside biblical principles of money management. Then, we need to get to work to get our own households in order. And by WE, I do mean ME as well. There is a lot I’ve had to take to the Lord on this one. It’s not easy, but it’s necessary.

God, help us!