addendum to financial gravity

Today's Wall Street Journal has an insightful article entitled "Bernanke is Fighting the Last War". The article is an interview with Anna Schwartz who "may know more about monetary history and banking than anyone alive." Schwartz's viewpoint is that the current crisis is being treated as a liquidity or lending crisis when in fact it is an asset crisis. The problem in this case is exotic securities that are toxic because no one knows how to value them. The "dirty little secret," says Schwartz, is that had Treasury Secretary Paulson proceeded with his original plan to buy up these assets at market prices many banks would have failed as a result. So instead, Paulson shifted to re-capitalizing the banks themselves. Yet because this avoids punishing bad decision-making it may merely prolong the crisis. The answer, suggests Schwartz, is rather to let bad banks fail. In other words: stop trying to defy gravity. Let's hope we don't spend another $700 billion (or even more) before learning our lesson.

the politics of defying financial gravity

I can't help but think that one of the reasons we're in the present American financial crisis is because our leaders really thought they could defy financial and moral gravity. Can't you hear the unspoken thought emanating from the Capitol Dome? "We're the greatest country in the free world. We can bend markets to our will and borrow as much as we want to do it."

Fannie Mae and Freddie Mac are just symptoms of the deeper problem. The purpose of Fannie Mae (The Federal National Mortgage Association) was to purchase and securitize mortgages as part of a secondary mortgage market that would providing liquidity to the primary mortgage market. Oops - that seems to have backfired. The purpose of Freddie Mac (The Federal Home Loan Mortgage Corporation) was the same. It was created in 1970 to provide competition for Fannie Mae, which had been privatized in 1968 to help balance the federal budget. Oops again - we just blew a $700 billion dollar hole in that plan.

What happened? Loans were made to people who couldn't afford them. These were termed sub-prime mortgages because the borrowers were below ideal (or even reasonable) standards. These loans were securitized and sold on the secondary mortgage market with the thought that while some of them might go bad, not all of them would, and that the risk was therefore both understandable and manageable. Yet suddenly everyone realized that a pig wearing lipstick is still a pig and confidence in the entire secondary mortgage market suddenly caved in. Gravity.

So the sub-prime mortgage crisis morphed into the credit crisis which has now morphed into a full-blown financial crisis. It's like a giant sinkhole that keeps expanding. Will the entire economy go down next? The country? If we continue trying to defy gravity, then, eventually, yes, this is precisely what will happen.

So, how do we get our feet back on solid ground? We recognize that we can't spend more than we take in. No more political games of promising to take from Paul to give to Peter. We can't all be Peters. We need to stand up where we are Pauls and say, "enough". No more government expansion. No more deficit spending. No more funny money. If we really want to end this crisis,we ought to return to the gold standard and start shrinking the size of government.

At this point it looks like Obama is going to win this election. If this happens let's face it: the gravity-defying acrobatics are only going to get more outlandish and the sinkhole will become a gaping chasm.

Wake up, America, before it's too late.

Christian authenticity

Peter Paul Rubens, "Landscape with an Avenue of Trees"

1 Thes. 1:1-10
For Sunday, October 19, 2008
Proper 24

One concept that appeals to many Christians today is the notion of being authentic. By authentic I mean being Christians in a way which reflects the reality of the gospel. We want to be authentic Christians who are members of authentic churches pursuing authentic ministry. Yet what does this really look like? 1 Thes. 1:1-10 paints a portrait that reveals Christian authenticity from several aspects.

A first aspect of Christian authenticity is a community that is aware of the Father, Son, and Spirit. Note how in verse 1 and 2 Paul, the author of 1 Thessalonians, is aware of both the Father's and Son's contributions to his relationship with his readers. Note then also in v. 5 he then references the third member of the Trinity, the Holy Spirit. Do our lives and congregations reflect similar awareness of each member of the Trinity? If not, who is missing, and why might this be? If so, do we sense the same kind of energy pulsing through our community that is pulsing through chapter 1 of this letter?

A second aspect of Christian authenticity is service characterized by faith, hope, and love. Paul says, "We continually remember before our God and Father your work produced by faith, your labor prompted by love, and your endurance inspired by hope in our Lord Jesus Christ (v. 3)." The most exciting church experiences I've had have come from being part of a dynamic community in which faith, hope, and love are present together. Father, let me work, labor, and endure with the faith, love, and hope of these Thessalonian believers.

A third aspect of Christian authenticity is proclamation framed not only by words, but also with power, the Spirit, and deep conviction (v. 5). Is my church proclaiming Christ not only in word, but also in power, the Spirit, and with deep conviction? If not, what is God calling me to do toward moving in this direction?

Beyond these three are two more aspects that can't adequately be covered in detail. A fourth aspect of Christian authenticity is leadership marked by incarnation, modeling, suffering, joy, and reproduction (vv. 6,7). A fifth aspect of Christian authenticity is faith characterized by repentance, service, and waiting on the Lord (vv. 8-10).

Let's examine each of these aspects of Christian authenticity - our experience of community, our service, our proclamation, our leadership, and our faith. May these verses affirm our own Christian authenticity where it exists and point the way ahead where we are deficient, that we might know and and rejoice in the genuineness of the authentic gospel.