How do we prioritize and measure political goals and progress? Are we more free today than yesterday? Are we wealthier and more prosperous than yesterday? Do we reap the fruit of our labors?
Are our representatives (politicians) engaged in good causes? Do we measure our politicians against a fixed position or against fundamental principles? Or do we sway back and forth with the whims and passions of the moment… Reagan, Bush Sr., Bill Clinton, Bush Jr., and now Obama says he’s going to bring about change and since we don’t like our current position we’ll vote for him? Now that we’ve gone a ways with Obama and he doesn’t appear to be delivering or at least he’s not delivering what we think he ought to….who will we go with next – Sarah Palin? Hillary Clinton? Mitt Romney? Rahm Emanuel? Ron Paul? Do we go with the party – elephant or the donkey? Maybe we go with the Green party or the Light party or the Libertarians?
What about the issues? Is it gay/lesbian rights? Abortion? Environment? Wars – Afghanistan & Iraq? Rumors of wars – Iran, N.Korea, Pakistan, China, Russia, Venezuela, and/or Mexico? War on Terrorism – the “database” otherwise known as Al Qaeda? War on Drugs – going on two decades? Gun control? National Debt – the rapidly approaching debt ceiling? Safety nets like unemployment, welfare & social security? Healthcare? State rights? Immigration? Globalization? Manufacturing and China’s pesky fixed exchange currency ratio that has undermined our manufacturing base – i.e. steals production jobs?
How do we prioritize what’s most important and then measure progress on these issues? Or is it as simple as having a roof overhead, 3 good meals a day, and an opportunity to work today for a better tomorrow? Where is our economic system today? Does it make us prosperous and united as a people or does it degrade, divide, and devour? Do we enjoy more economic freedom today than our forefathers of yesterday? How do we even define economic freedom? Or liberty in general?
Marion G. Romney in his talk “The Perfect Law of Liberty” stated:
The meaning of the word liberty is difficult to circumscribe. The sweets of liberty about which we usually speak may be classified as:
(1) Political independence,
(2) Economic freedom, and
(3) Free agency.
The three are inseparably connected. The Baron Nathan Mayer Rothschild is reported to have said:
“I care not what puppet is placed on the throne of England to rule the Empire…The man that controls Britain’s money supply controls the British Empire. And I control the money supply.”
In order to enjoy political independence one must also enjoy economic freedom. While we enjoy free agency no matter what condition we may find ourselves in…the constraints in which we find ourselves may severely limit the use of that free agency with regard to the enjoyment of political independence and economic freedom. Often times it is through the use of our free agency that we severely constrain our political independence and economic freedom. Brother Romney in his talk used the biblical example of the Egyptians:
We have a classic example of the loss of economic freedom by the misuse of free agency in the book of Genesis. The Egyptians, instead of exercising their agency to provide for themselves against a day of need, depended upon the government. As a result, when the famine came they were forced to purchase food from the government. First they used their money. When that was gone, they gave their livestock, then their lands; and finally they were compelled to sell themselves into slavery, that they might eat. (See Gen. 41:54–56; Gen. 47:13–26.)
The choices that we make as a collective people, utilizing our individual free agency, either lead us towards liberty or away from liberty depending upon the principles (fundamental laws or natural laws) employed. The foundation was solid and the founding fathers paid a price in blood that has enabled multiple generations to enjoy political independence and economic freedom. Where are we today?
President Harold B. Lee said,
“Today we are being tested and tried by another kind of test that I might call the ‘test of gold’—the test of plenty, affluence, ease—more than perhaps the youth of any generation have passed through, at least in this Church.”Sweet Are the Uses of Adversity, Brigham Young University Speeches of the Year, Provo, 7 Feb. 1962, p. 3.) (
President Brigham Young stated,
“The worst fear I have about this people is that they will get rich in this country, forget God and His people, wax fat, and kick themselves out of the Church and go to hell. This people will stand mobbing, robbing, poverty, and all manner of persecution, and be true. But my greater fear … is that they cannot stand wealth.” (James S. Brown, Life of a Pioneer, Salt Lake City: Geo. Q. Cannon and Sons Co., 1900, pp. 122–23.)
Brother Dean L. Larsen put it in this manner,
“The coveting of wealth so often has resulted in avarice, dishonesty, and greed. The acquisition of wealth has frequently produced pride, self-satisfaction, and arrogance.
History repeatedly confirms that the abundance of earthly possessions can be both a blessing and a curse, depending upon the way these things are viewed and used. When we consume them on our own lust, we invoke tragedy.” (“Beware Lest Thou Forget the Lord”, April 1991 General Conference address.)
Elder M. Russell Ballard stated,
“We are living in a period of great prosperity that may, when history is written, prove to be as devastating to our souls as the effects of physical persecutions were upon the bodies of our pioneer ancestors.” (“The Law of Sacrifice”, Liahona, Mar. 2002, p. 10.)
Is it out of bounds to refer to debt as greed – wanting the benefits of tomorrow’s labor today?
Currently our monetary system is designed to transfer the ownership of all assets to the banks over time.
This is done by creating money via debt. Want to buy a house…simple, just sign on the dotted line. The mechanics of that transaction involve the bank drawing up an IOU for the debtor to sign. The bank creates the money against the IOU, which then becomes an asset for the bank, and the debtor happily hands over the money to a home builder or prior owner. That money has now entered the money supply and is free to circulate. There are constraints within which the bank must operate, controlled by the Federal Reserve, which is the ultimate creator/lender of debt, but that is basically how the money creation mechanism in our monetary system functions. Pretty much just 1’s and 0’s in the computer.
What about the terms of the deal? The debtor must either pay back the original loan amount to the bank – plus interest – or default and turn over the home to the bank – i.e. foreclosure. So the bank in return for being the loan facilitator or money creation instrument gets the original money back PLUS interest or the home. Sounds like a win/win for the bank doesn’t it? What did it cost them? Did the bank have the money prior to the loan? Or is it just 1’s and 0’s in the computer – facilitated by the Federal Reserve?
Where does the debtor (new home owner) get the interest? If I purchase a $500k home today at 5% interest I will have to pay back roughly $1.2 million dollars. Where do I come up with the extra $700,000? Did the banks slip $700k out the back door that I can sneak around and grab in order to make good on the IOU?
This is the fundamental flaw (or genius design) of our current monetary system. The only saving grace is time. The way I can make good on my IOU for that home purchase is that I have 30 years for you and everyone else to come along day after day, year after year, and borrow thousands upon thousands more to inject into the money supply. Through my labors and industrious business pursuits I get a little bit of your money to add to my money that is circulating and I am able to pay the principle and interest payment on my IOU. There are some hiccups – like more money circulating for relatively the same amount of goods which causes a little bit of inflation…but for the most part the system works. Of course some economists rant about it and people complain because the IRS takes a fixed percentage off the top….and since the top is growing (inflation) the IRS is in reality taking a larger and larger chunk every year…but the system functions fairly well and the majority of the people feel like they are prospering as their home values rise. Life is good as long as new debt is constantly being created in greater and greater quantities!
Question of the day is – Can it go on forever? Unfortunately, the mathematical answer is NO.
At some point in time a point is reached where one can barely service the debt they have let alone taking on additional debt. When everyone (or the majority) reaches that position….called debt saturation…it is game over. The fundamental flaw (or genius design) is that the debt must grow larger and larger every year in order to keep the system functioning. The longer we go the higher the increases in debt must be. The financial system is a giant debt pyramid dependent upon an ever growing debt base. Otherwise there is not enough money to go around and demand for everything drops. Jobs are cut, wages cut, home prices drop, and the defaults (official transfer of ownership to the bank) start ramping up.
We started to hit the debt saturation point in the mid-90’s and Greenspan created the Sweeps program which swept demand deposits into a savings account to be loaned out. Demand deposits are basically checking accounts. You write a demand (check) against your deposit (checking account) and the money is supposed to be there to make good or you get hit with fees, fines, and ultimately the possibility of prison. Well the genius Greenspan decided that all that money sitting around in checking accounts (average account balances) would better serve the economy by being swept into a savings account and loaned out. So as long as you keep your average checking account balance above a certain amount (typically $1000-1500) the banks are making money off your money (interest payments) and won’t charge you a fee for having a checking account.
The Sweeps program ramped up to add several hundred billion a year in liquidity to our monetary system. This wasn’t the only tool in the toolbox and other things were used like ramping up credit cards and other debt instruments. A few years went by and we started to plateau in debt accumulation so Greenspan then brilliantly lowered the cost of debt (interest rate) thus raising the debt saturation limit – effectively increasing the amount of borrowed money that can be serviced. For example, if the interest portion of your home loan drops….your monthly house payment drops and you can afford more house….or at least a higher initial home value. Going back to our earlier analogy…the $700k in interest on my home loan shrinks to $400k and I can now buy an $800k house instead of the previous $500k house while still maintaining my $1.2 million total cost for the house. Greenspan even went so far as to lower the cost of debt (interest rates) below the rate of inflation so that a person would be absolutely stupid not to take all that “cheap” money and bury themselves head over heels in debt. A brilliant play on his part – insert debt gavage and stuff us until we cannot pay and must relinquish ownership of all our assets…all voluntarily, through use of our own free agency, by the way.
Picture yourself entering a casino in Vegas. You obtain chips (Federal Reserve Notes or FRNs) from the casino based upon a pledge of collateral (assets or future labor) in the form of an IOU – either collateralized (assets) or personal signature (future labor). The house sets the rules and you can’t play without their chips (FRNs). In this economic game, at the end of the day, you must return more chips (principle + interest payments + taxes) than chips that enter the game (debt). The house is mathematically guaranteed to get a percentage – winners don’t keep the lights on (take it up with the IRS). Thus the only way you can win is for someone else to lose (hence the evil nature of gambling) – either now or at some future point in the game. Therefore, in order for everyone to enjoy the game or more precisely, exit in one piece with ownership of all your assets, it becomes a Ponzi scheme – new money (debt via new borrowers) must constantly enter the game in greater and greater quantities in order for the old money to walk away whole (break even after interest & taxes or better yet make a profit).
Like all Ponzi schemes (Social Security anyone?) there is an end point where you run out of new bodies – can’t find any new suckers. People have figured out the game and are unwilling to play or in this case – we reach the debt saturation point where there is no more assets to pledge for chips and all the future labor has been sold off into the foreseeable future (generations upon generations born indebted throughout most of the world). The gaming franchise now has complete ownership and the players are slaves since all the players are maxed out (owe more chips than what is currently in circulation). This is also a mathematical certainty.
Does it start to sound like Egypt yet? In the Priesthood session of the October 1998 conference President Gordon B. Hinckley related the following:
I wish to speak to you about temporal matters.
As a backdrop for what I wish to say, I read to you a few verses from the 41st chapter of Genesis.
Pharaoh, the ruler of Egypt, dreamed dreams which greatly troubled him. The wise men of his court could not give an interpretation. Joseph was then brought before him: “Pharaoh said unto Joseph, In my dream, behold, I stood upon the bank of the river:
“And, behold, there came up out of the river seven kine, fatfleshed and well favoured; and they fed in a meadow:
“And, behold, seven other kine came up after them, poor and very ill favoured and leanfleshed. …
“And the lean and the ill favoured kine did eat up the first seven fat kine: …
“And I saw in my dream … seven ears came up in one stalk, full and good:
“And, behold, seven ears, withered, thin, and blasted with the east wind, sprung up after them:
“And the thin ears devoured the seven good ears: …
“And Joseph said unto Pharaoh, … God hath shewed Pharaoh what he is about to do.
“The seven good kine are seven years; and the seven good ears are seven years: the dream is one. …
“… What God is about to do he sheweth unto Pharaoh.
“Behold, there come seven years of great plenty throughout all the land of Egypt:
“And there shall arise after them seven years of famine;
“… And God will shortly bring it to pass” (Gen. 41:17–20, 22–26, 28–30, 32).
Now, brethren, I want to make it very clear that I am not prophesying, that I am not predicting years of famine in the future. But I am suggesting that the time has come to get our houses in order.
So many of our people are living on the very edge of their incomes. In fact, some are living on borrowings.
We have witnessed in recent weeks wide and fearsome swings in the markets of the world. The economy is a fragile thing. A stumble in the economy in Jakarta or Moscow can immediately affect the entire world. It can eventually reach down to each of us as individuals. There is a portent of stormy weather ahead to which we had better give heed.
I hope with all my heart that we shall never slip into a depression. I am a child of the Great Depression of the thirties. I finished the university in 1932, when unemployment in this area exceeded 33 percent.
I repeat, I hope we will never again see such a depression. But I am troubled by the huge consumer installment debt which hangs over the people of the nation, including our own people. In March 1997 that debt totaled $1.2 trillion, which represented a 7 percent increase over the previous year.
In December of 1997, 55 to 60 million households in the United States carried credit card balances. These balances averaged more than $7,000 and cost $1,000 per year in interest and fees. Consumer debt as a percentage of disposable income rose from 16.3 percent in 1993 to 19.3 percent in 1996.
Everyone knows that every dollar borrowed carries with it the penalty of paying interest. When money cannot be repaid, then bankruptcy follows. There were 1,350,118 bankruptcies in the United States last year. This represented a 50 percent increase from 1992. In the second quarter of this year, nearly 362,000 persons filed for bankruptcy, a record number for a three-month period.
We are beguiled by seductive advertising. Television carries the enticing invitation to borrow up to 125 percent of the value of one’s home. But no mention is made of interest.
President J. Reuben Clark Jr., in the April 1938 general conference, said from this pulpit: “Once in debt, interest is your companion every minute of the day and night; you cannot shun it or slip away from it; you cannot dismiss it; it yields neither to entreaties, demands, or orders; and whenever you get in its way or cross its course or fail to meet its demands, it crushes you” (in Conference Report, Apr. 1938, 103).
Since the beginnings of the Church, the Lord has spoken on this matter of debt. To Martin Harris through revelation He said: “Pay the debt thou hast contracted with the printer. Release thyself from bondage” (D&C 19:35).
President Heber J. Grant spoke repeatedly on this matter from this pulpit. He said: “If there is any one thing that will bring peace and contentment into the human heart, and into the family, it is to live within our means. And if there is any one thing that is grinding and discouraging and disheartening, it is to have debts and obligations that one cannot meet” (Gospel Standards, comp. G. Homer Durham , 111).
President Faust would not tell you this himself. Perhaps I can tell it, and he can take it out on me afterward. He had a mortgage on his home drawing 4 percent interest. Many people would have told him he was foolish to pay off that mortgage when it carried so low a rate of interest. But the first opportunity he had to acquire some means, he and his wife determined they would pay off their mortgage. He has been free of debt since that day. That’s why he wears a smile on his face, and that’s why he whistles while he works.
I urge you, brethren, to look to the condition of your finances. I urge you to be modest in your expenditures; discipline yourselves in your purchases to avoid debt to the extent possible. Pay off debt as quickly as you can, and free yourselves from bondage.
This is a part of the temporal gospel in which we believe. May the Lord bless you, my beloved brethren, to set your houses in order. If you have paid your debts, if you have a reserve, even though it be small, then should storms howl about your head, you will have shelter for your wives and children and peace in your hearts. That’s all I have to say about it, but I wish to say it with all the emphasis of which I am capable.
We are not alone. States and local municipalities have also been kicking the debt can down the road for decades via bonds. They never pay off a bond but borrow new money to pay off the old money….plus borrow a little extra. This also extends to governments and corporations around the world. In the past decade we have seen a dramatic shrinking effect in average maturity dates (average time to pay the debt off). This is best depicted in the following excerpt from an article posted on Zero Hedge a year ago:
The U.S. Lunatic Asylum (i.e., Economy) Is Facing Approximately $15 Trillion In Roll Risk By 2012
Zero Hedge recently highlighted the developing risk in the government’s outstanding Treasury portfolio, where nearly 40% of all issues mature within the year. As such the roll risk for the US government is massive, and even the smallest unexpected macro blip would make the rolling/refinancing of roughly $5 trillion in debt very problematic. Yet the US government is not alone in this quandary of how to keep T-Bill interest rates at record lows: an earlier report by Moody’s demonstrates that the banking system is in far, far worse shape: “we note that average maturities of new debt issuances rated by Moody’s – which we use as an indicator of general trends — fell from 7.2 years to 4.7 years globally over the last five years. This is the shortest average maturity for new debt at any given point during the 30 years of bank funding history covered by our analysis. As a related matter, we estimate that banks that we rate will face maturing debt of about $10 trillion between now and the end of 2015, $7 trillion of which will occur by the end of 2012.”
Let’s do the math: the US Gov’t needs to roll about $3 trillion (and increasing) every year, Commercial Real Estate has a $3 trillion refi cliff around 2014 and the banking system has a $7 trillion roll maturity by 2012. In other words at or about 2012, or at the time Barack Obama is sure to be enjoying record approval ratings (high or low, your choice) courtesy of 30% unemployment, the American economy will be straddled with not just the ongoing burden of issuing about $2 trillion in debt each year to finance what can only be characterized as a budget concocted by the most hard-core, raving lunatics in the Federal Insane Asylum Reserve, but will have to deal with roughly $15 trillion of rolling maturities.
Full Moody’s report for those who would rather see that the US economy is going to 10th circle of hell promptly, instead of buying Amazon stock at 1E10^18243 P/E, attached below.
In 2008 after a number of years of glorious debt ramp up we hit the debt saturation point again. It has taken nearly 100 years since that secret meeting on Jekyll Island but the end game has finally arrived. At a couple points in 2008 it seemed as though the entire financial system would collapse (within hours of doing so) but the private banking cartel through their front corporation, the Federal Reserve, transferred bad assets at 95-100% market value to the Federal Reserve’s balance sheet….basically a shell game that ended up putting the burden upon the American taxpayer….a win/win situation for the banks. They have printed more money but the vast majority of the new money the banks have used to speculate in the commodity markets to keep the price of commodities high while demand for those commodities drops. Basically keeping the sheeple believing that inflation will continue to be the theme versus deflation. In other words increasing the heat to the pot gradually in order to keep the frogs from all jumping out.
A short Google search of “Jekyll Island” and “banking” will provide one with some historical insight into this secret combination to get gain. We have been warned repeatedly of secret combinations. In fact Elder L. Tom Perry spelled it out in the following manner in his October 2005 Conference address:
The Book of Mormon is a voice of warning to this generation. See how vividly it describes conditions on the earth today:
“And no one need say [these records] shall not come, for they surely shall, for the Lord hath spoken it; for out of the earth shall they come, by the hand of the Lord, and none can stay it; and it shall come in a day when it shall be said that miracles are done away; and it shall come even as if one should speak from the dead.
“And it shall come in a day when the blood of saints shall cry unto the Lord, because of secret combinations and the works of darkness.
“Yea, it shall come in a day when the power of God shall be denied, and churches become defiled and be lifted up in the pride of their hearts; yea, even in a day when leaders of churches and teachers shall rise in the pride of their hearts, even to the envying of them who belong to their churches.
“Yea, it shall come in a day when there shall be heard of fires, and tempests, and vapors of smoke in foreign lands;
“And there shall also be heard of wars, rumors of wars, and earthquakes in divers places.
“Yea, it shall come in a day when there shall be great pollutions upon the face of the earth; there shall be murders, and robbing, and lying, and deceivings, and whoredoms, and all manner of abominations; when there shall be many who will say, Do this, or do that, and it mattereth not, for the Lord will uphold such at the last day. But wo unto such, for they are in the gall of bitterness and in the bonds of iniquity” (Morm. 8:26–31).
President Ezra Taft Benson reaffirmed the fact that the Book of Mormon is of particular value to our time when he said:
“The Book of Mormon was written for us today. God is the author of the book. It is a record of a fallen people, compiled by inspired men for our blessing today. Those people never had the book—it was meant for us. Mormon, the ancient prophet after whom the book is named, abridged centuries of records. God, who knows the end from the beginning, told him what to include in his abridgment that we would need for our day” (“The Book of Mormon Is the Word of God,” Ensign, May 1975, 63).
Among the lessons we learn from the Book of Mormon are the cause and effect of war and under what conditions it is justified. It tells of evils and dangers of secret combinations, which are built up to get power and gain over the people. It tells of the reality of Satan and gives an indication of some of the methods he uses.
Speaking of power and gain, in the October 1988 General Conference President Ezra Taft Benson boldly declared,
“I testify that wickedness is rapidly expanding in every segment of our society. (See D&C 1:14–16; D&C 84:49–53.) It is more highly organized, more cleverly disguised, and more powerfully promoted than ever before. Secret combinations lusting for power, gain, and glory are flourishing. A secret combination that seeks to overthrow the freedom of all lands, nations, and countries is increasing its evil influence and control over America and the entire world. (See Ether 8:18–25.)”
One stratagem employed in 2008 was for the Federal government (real Fed) to keep loaning lots of money to the states for things like Medicaid and Unemployment to keep the politicians plump and happy….and support the bottom to enhance reliance on the Federal Government (buy votes and supporters who otherwise might riot and bring the system down since they don’t have anything left to lose). Why? Well at this stage of the game – end point – the focus changes from enticing people further into debt (mathematically, despite exotic shadow banking derivatives, no longer a possibility) to conducting an orderly transfer of assets to the banks. People have a tendency to get violent and angry when they realize they no longer own anything and have become serfs…especially after enjoying a couple hundred years of freedom and prosperity that the rest of the world has never known. Go too fast and the frog will jump out of the pot before the water boils him into a tasty meal.
We also see this not only at the state but also at the local municipality level – best depicted in the following excerpt from an article posted on Zero Hedge last week:
We often disparage the Wall Street Journal for being too spineless to tell it like it is when reporting on the state of the economy, but with last Friday’s lead story, New Hit to Strapped States, they pulled no punches. You can almost pick a paragraph at random and get a sense of how serious the cities’ credit problems are. This paragraph, for instance “Municipalities borrowed $122 billion of variable rate demand debt in 2008, roughly twice the amount of these types of loans borrowed the year before…” How did they get in so deep? The answer lies in the way they navigated the shoals of 2008. While most muni-bond debt is long-term, scads of jerry-rigged credit deals were struck that year to get municipal borrowers past the crunch. For the most part, this involved the use of so-called letters of credit – guarantees by large banks to backstop municipal borrowers when they were having trouble raising cash via bond auctions. Under the circumstances, noted the Journal, “Many municipalities scrambled to convert the debt into other instruments, including variable-rate demand obligations, which are long-term bonds with interest rates that reset periodically. For a fee, big banks guaranteed many of these deals.”
Now, the letters of credit are expiring, and although borrowers must have believed in 2008 that it would be easy to renew them a few years hence, this has not proven to be the case. In fact, if banks are willing to issue letters of credit at all, it is at prohibitively steep premiums. For municipal borrowers, the only alternative is to pay increasingly punitive auction rates at a time when they are struggling just to pay their bills. On Friday, those rates hit 5.01 percent for 30-year, Triple-A general obligation bonds, reflecting a ratcheting up of perceptions of risk. A notable casualty was a New Jersey agency that had to reduce the size of a bond issue by about 40%, and to pay a higher rate, because of soft demand.
The Journal story stopped short of saying the cities are effed, but the implication is unavoidable. After all, this is not a market that the Fed can control, and it therefore seems entirely predictable that market forces will continue to raise the risk premium on municipal borrowing, even as cities struggle to balance budgets with a combination of job and spending cuts and tax hikes. You don’t have to be an economist to see that that those supposed remedies won’t work – that they will only energize a deflationary spiral that eventually will push hundreds of cities into bankruptcy before the furies are spent.
The roll up strategy is currently being implemented in multiple arenas – banking (big government subsidized banks eat all the little banks – who are dying, a couple at a time, every week), federal power (states were enticed into debt and now via federal handouts are giving up sovereignty and power while becoming further indebted to the federal government by the week), and the 4th branch of federal government, the alphabet soup (DHS, NSA, TSA, FEMA, CIA, FBI, IRS, DIA, ATF, NORTHCOM, etc.) is getting more power by the week. War is basically an amplified crisis (everything on a need to know basis) and thus is an extremely powerful mechanism for gaining control…especially a War on Terror that never ends, has no real identifiable enemy, and can create whatever enemies the bank controlled state desires.
Today the banks are global so their best interests are not confined to our little nation…and the rest of the world is also quickly falling into their hands. Europe is a little ahead of us in the forced austerity ratchet down….but we aren’t far behind. In terms of our near future, I see (for whatever its worth) another 20-30% drop in house prices over the next 6 to 12 months. I see rising interest rates on all credit products. I see massive defaults/bankruptcies (transfer of ownership). I see rising energy/food (tied together at the hip) costs. I see people struggling to pay back debt with dollars that are harder and harder to come by. I see the next wave in job losses hitting mid-summer 2011 due to the contraction of state and local governments as a result of budget cuts. I see serious battles breaking out between cities, counties, and states over funding. I see tremendous difficulties around the world in rolling over (refinancing) trillions, in now, short term debt. The distance the politicians, the liaisons who don’t want to break the good news to us, can continue to kick the can down the road is getting less and less as banks (ultimately owned by a few global private investors) put the squeeze on maturity dates and debt costs. You may manage to refinance today but the bankers will be waiting tomorrow with more burdensome terms.
We have been warned over and over about debt and the consequences of debt. Elder Joseph B. Wirthlin stated in the April 2004 General Conference in his address “Earthly Debts, Heavenly Debts”,
In spite of the teachings of the Church from its earliest days until today, members sometimes fall victim to many unwise and foolish financial practices. Some continue to spend, thinking that somehow the money will become available. Somehow they will survive.
Far too often, the money hoped for does not appear.
Remember this: debt is a form of bondage. It is a financial termite. When we make purchases on credit, they give us only an illusion of prosperity. We think we own things, but the reality is, our things own us.
President Heber J. Grant said, “From my earliest recollections, from the days of Brigham Young until now, I have listened to men standing in the pulpit … urging the people not to run into debt; and I believe that the great majority of all our troubles today is caused through the failure to carry out that counsel.” 3
President Ezra Taft Benson said, “Do not leave yourself or your family unprotected against financial storms. … Build up savings.” 4
President Harold B. Lee taught, “Not only should we teach men to get out of debt but we should teach them likewise to stay out of debt.” 5
President Gordon B. Hinckley declared: “Many of our people are living on the very edge of their incomes. In fact, some are living on borrowings. …
“… I urge you to be modest in your expenditures; discipline yourselves in your purchases to avoid debt to the extent possible. Pay off debt as quickly as you can, and free yourselves from bondage.” 6
My brothers and sisters, many have heeded this prophetic counsel. They live within their means, they honor the debts they have incurred, and they strive to reduce the burden they owe to others. We congratulate those who are doing so, for the day will come when they will reap the blessings of their efforts and understand the value of this inspired counsel.
Elder L. Tom Perry in the October 1995 General Conference in his address “If Ye Are Prepared Ye Shall Not Fear” stated,
Necessary debt should be incurred only after careful, thoughtful prayer and after obtaining the best possible advice. We need the discipline to stay well within our ability to pay. Wisely we have been counseled to avoid debt as we would avoid the plague. President J. Reuben Clark fearlessly and repeatedly counseled members of the Church to take action.
“Live within your means. Get out of debt. Keep out of debt. Lay by for a rainy day which has always come and will come again. Practice and increase your habits of thrift, industry, economy, and frugality” (in Conference Report, Oct. 1937, p. 107).
Last but not least, our beloved Prophet, President Thomas S. Monson has promised us in his address “True to the Faith” during the April 2006 General Conference –
The final maka-feke I wish to mention today is one which can crush our self-esteem, ruin relationships, and leave us in desperate circumstances. It is the maka-feke of excessive debt. It is a human tendency to want the things which will give us prominence and prestige. We live in a time when borrowing is easy. We can purchase almost anything we could ever want just by using a credit card or obtaining a loan. Extremely popular are home equity loans, where one can borrow an amount of money equal to the equity he has in his home. What we may not realize is that a home equity loan is equivalent to a second mortgage. The day of reckoning WILL come if we have continually lived beyond our means.
Now that we have the background in place…What’s the most important political issue today? If we resolve our economic problems doesn’t that buy us time, at our leisure, to try and resolve the rest of our issues with the security that we’ll have a roof over our heads, 3 good meals a day, and the opportunity to work today for a better tomorrow? Or as the founding fathers more wisely put – Life, Liberty, and the pursuit of Happiness (property)? If that is the most important measuring stick and the one we can all unite on…which side of the fence do our politicians fall on? Do they work to incur more debt or to get out of debt? Do they work for the private banks or do they work for the people? Do they support a return to our Constitutional mandate for Congress to issue or coin money without interest attached? Or do they work for the private banking cartel called the Federal Reserve? How do we know?
“If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around them will deprive the people of all property until their children wake up homeless on the continent their Fathers conquered…I believe that banking institutions are more dangerous to our liberties than standing armies… The issuing power should be taken from the banks and restored to the people, to whom it properly belongs.” – Thomas Jefferson
“For behold, the Lord had blessed them so long with the ariches of the world that they had not been stirred up to anger, to wars, nor to bloodshed; therefore they began to set their hearts upon their riches; yea, they began to seek to get gain that they might be lifted up one above another; therefore they began to commit bsecret murders, and to rob and to plunder, that they might get gain.
But behold, Satan did stir up the ahearts of the more part of the Nephites, insomuch that they did unite with those bands of robbers, and did enter into their covenants and their oaths, that they would protect and preserve one another in whatsoever difficult circumstances they should be placed, that they should not suffer for their murders, and their plunderings, and their bstealings.
Now behold, those asecret oaths and covenants did not come forth unto Gadianton from the brecords which were delivered unto Helaman; but behold, they were put into the heart of cGadianton by that dsame being who did entice our first parents to partake of the forbidden fruit— Yea, that same being who did plot with aCain, that if he would murder his brother Abel it should not be known unto the world. And he did plot with Cain and his followers from that time forth. And also it is that same being who put it into the hearts of the people to abuild a tower sufficiently high that they might get to heaven. And it was that same being who led on the people who came from that tower into this land; who spread the works of darkness and abominations over all the face of the land, until he dragged the people down to an bentire destruction, and to an everlasting hell. Yea, it is that same being who put it into the heart of aGadianton to still carry on the work of darkness, and of secret murder; and he has brought it forth from the beginning of man even down to this time. And behold, it is he who is the aauthor of all sin. And behold, he doth carry on his works of darkness and secret murder, and doth hand down their plots, and their oaths, and their covenants, and their plans of awful wickedness, from generation to generation according as he can get hold upon the hearts of the children of men.” – Helaman 6:17, 21, 26–30
“And they did enter into a acovenant one with another, yea, even into that covenant which was given by them of old, which covenant was given and administered by the bdevil, to combine against all righteousness. Therefore they did combine against the people of the Lord, and enter into a covenant to destroy them, and to deliver those who were guilty of murder from the grasp of justice, which was about to be administered according to the law. And they did set at defiance the law and the rights of their country; and they did covenant one with another to destroy the governor, and to establish a aking over the land, that the land should no more be at bliberty but should be subject unto kings.” 3 Nephi 6:28–30
“Wherefore, the Lord commandeth you, when ye shall see these things come among you that ye shall awake to a sense of your awful situation, because of this secret combination which shall be among you; or wo be unto it, because of the blood of them who have been slain; for they cry from the dust for vengeance upon it, and also upon those who built it up.” – Ether 8:24
“These are the times that try men’s souls. The summer soldier and the sunshine patriot will, in this crisis, shrink from the service of their country; but he that stands it now deserves the love and thanks of man and woman. Tyranny, like hell, is not easily conquered; yet we have this consolation with us, that the harder the conflict, the more glorious the triumph….Heaven knows how to put a proper price upon its goods; and it would be strange indeed if so celestial an article as FREEDOM should not be highly rated.” – Thomas Paine
“Give me Liberty or give me death” – Patrick Henry
What we do in life echoes for an eternity. May I conclude with more excerpts from President Ezra Taft Benson’s talk “I Testify” in the October 1988 General Conference address:
I testify that America is a choice land. (See 2 Ne. 1:5.) God raised up the founding fathers of the United States of America and established the inspired Constitution. (See D&C 101:77–80.) This was the required prologue for the restoration of the gospel. (See 3 Ne. 21:4.) America will be a blessed land unto the righteous forever and is the base from which God will continue to direct the worldwide latter-day operations of His kingdom. (See 2 Ne. 1:7.)
I testify that as the forces of evil increase under Lucifer’s leadership and as the forces of good increase under the leadership of Jesus Christ, there will be growing battles between the two until the final confrontation. As the issues become clearer and more obvious, all mankind will eventually be required to align themselves either for the kingdom of God or for the kingdom of the devil. As these conflicts rage, either secretly or openly, the righteous will be tested. God’s wrath will soon shake the nations of the earth and will be poured out on the wicked without measure. (See JS—H 1:45; D&C 1:9.) But God will provide strength for the righteous and the means of escape; and eventually and finally truth will triumph. (See 1 Ne. 22:15–23.)
“I testify that it is time for every man to set in order his own house both temporally and spiritually. It is time for the unbeliever to learn for himself that this work is true, that The Church of Jesus Christ of Latter-day Saints is the kingdom which Daniel prophesied God would set up in the latter days, never to be destroyed, a stone that would eventually fill the whole earth and stand forever. (See Dan. 2:34–45; D&C 65:2.) It is time for us, as members of the Church, to walk in all the ways of the Lord, to use our influence to make popular that which is sound and to make unpopular that which is unsound. We have the scriptures, the prophets, and the gift of the Holy Ghost. Now we need eyes that will see, ears that will hear, and hearts that will hearken to God’s direction.”
I testify that not many years hence the earth will be cleansed. (See D&C 76:41.) Jesus the Christ will come again, this time in power and great glory to vanquish His foes and to rule and reign on the earth. (See D&C 43:26–33.) In due time all men will gain a resurrection and then will face the Master in a final judgment. (See 2 Ne. 9:15, 41.) God will give rewards to each according to the deeds done in the flesh. (See Alma 5:15.)