Villa Rica is a small town to the west of Atlanta. Like many areas around Atlanta, this city, whose name ironically means “rich village,” has been hit hard by the mortgage crisis. Home prices here were rising quickly over the past few years as Atlanta’s real estate market blossomed amid rising home values and a booming local economy. Homeowners in Villa Rica, the site of a gold rush in the early 1800s, found that their homes were an investment that was as good as gold.
All that came to a swift end when the mortgage crisis hit in 2008. Development all but stopped as home sales crashed to a halt. Rising numbers of foreclosures meant that many homes sat empty for months on end.
In my neighborhood on the north side of town, near Wesley Chapel Road, home prices had increased by 30% over the previous ten years. This is a small, quiet subdivision with newer houses that were close to the median price for the area. Almost overnight, the market value of these homes fell by approximately half. A planned subdivision that was being built behind my neighborhood now sits silent. Its roads are completed but there are no houses along them.
For Sale signs went up but brought in few prospective buyers. Most prospective sellers stopped bothering with real estate agents and put out For Sale By Owner signs. For a period of almost a year, we had vacant foreclosure houses on either side of my home. It has only been in the past few weeks that a family has bought one of these houses using seller financing. The other is still vacant.
The credit freeze is an important aspect of the fallen real estate prices. With banks afraid to lend money, it can be hard for many people to qualify for mortgages. Since we have owned our house for several years, as interest rates fell I contacted our loan officer to discuss refinancing our mortgage.
He told me that even though we have excellent credit, a refinance is out of the question because of the declining values of homes. As home prices fell, we lost equity so that, like many other homeowners around the country, we now owe more on our mortgage than our home is currently worth.
The same trend makes it difficult for new homebuyers to secure financing. In sharp contrast to the past decade, most banks are now requiring borrowers, even those with excellent credit, to make a down payment of at least twenty percent of the purchase price of the home. When combined with the crash of the stock market and other investments, this means that many prospective buyers do not have a sufficiently large nest egg to take advantage of the many great real estate deals that exist. The one recent sale in my neighborhood was financed by the seller and did not involve a bank.
Eventually, the economy will begin to grow again and the real estate markets will wake from their slumber. Banks will begin to lend more money and people will once again be able to purchase their dream home. As buyers enter the market, home prices will once again start to rise. For homeowners in Villa Rica and around the country, that day cannot come soon enough.
3/25/09
Bedford MA
Wednesday, March 25, 2009
Tuesday, March 24, 2009
Buying a First Home in a Tight Economy
The mortgage crisis has created a surplus of homes for sale with very few buyers. This means that many people have a golden opportunity to get a great deal on a nice home. Plunging prices tempt buyers to purchase homes at a discounts of approximately fifty percent of what the house sold for a few years ago in many cities. First time homebuyers might be skittish about buying a home in such an unstable economy, but if you do your “homework” you can safely get a good deal.
First, look at the big picture. Examine the industry in which you work and take a close look at how your company is faring. If your industry is particularly unstable, or if your company is considering layoffs or pay cuts, you should be very careful about committing yourself to a mortgage. You should try to minimize the chance that you will not be able to pay your bills by considering the chance that you will be facing unemployment or decrease in pay.
Second, when you start shopping for a home, carefully consider how much you should spend. Traditionally, lenders have desired that a mortgage payment be no more than 25% of borrower’s take-home pay and that all payments be less than 32% of the total take home pay. For example, if you make $5,000 per month after taxes, your mortgage payment, including escrows for homeowner’s insurance and property taxes, should be less than $1250 per month. Similarly, your total monthly obligations, including credit cards, car payments, etc. should be less than $1600 per month. This ensures that there will be plenty of money left over to pay utilities and buy other necessities, such as food and clothing. In the current economic climate, a borrower would be wise to be even more conservative than these traditional guidelines.
In the past, borrowers could finance almost all of the cost of a home. Now, however, mortgages with no money down or small down payments are a thing of the past. To minimize their own risks, most banks are requiring a down payment of at least twenty percent of the sale price. This means that most borrowers will need a sizable nest egg to qualify for a mortgage. Banks normally require that the down payment money be verified over a period of time. For example, it is not uncommon to require six months of bank statements or documentation showing the source of the funds. Gifts are normally acceptable, but it is common to require that the donor complete forms that state that the money is a gift and not a loan. Gifts or abnormal sources of down payments will likely trigger additional scrutiny of loan applications these days.
Shop around to find the best interest rate and down payment. Dealing with a mortgage broker instead of individual banks makes it easier to find the best deal. A major cause of the current crisis is that many people were not fully aware of what type of mortgage they were buying. Ask questions and find out exactly what is being offered. This is particularly important if you are buying an adjustable rate mortgage (ARM). You should find out how much the interest rate can adjust and how much that will increase your payment. Also find out if there is a prepayment penalty or a balloon payment. If you do not understand what you are signing, don’t sign!
The best way to shop for a house is to get pre-approved for a mortgage before you start looking at houses. This way you will know in advance how much the bank is willing to loan and you can shop for houses within your price range. This also makes it easier to close on your house quickly when you find your dream home. Since your finances have already been approved by the lender, only items dealing with your specific house will have to be completed.
When you begin shopping for a house, consider foreclosures and other distressed sales. These homes often sell at deep discounts, but do carry some additional risks. For example, such homes are often sold “as is” with no warranty. Since the previous owner could not afford to make the mortgage payments on the home, it is unlikely that they were able to pay for upkeep and maintenance on the home as well. In some cases, the previous owner may even have vented their frustrations on the house’s windows, walls, and doors. This damage will probably not be repaired by the seller and therefore will add to the real cost of buying the home. If the house has been unoccupied, there may be damage from vandals as well.
To minimize the risk of finding unpleasant surprises in the form of expensive repairs after closing on your new home, it is essential to have both an appraisal and a home inspection done before you buy your home. The appraisal confirms the market value of the home and will likely be required by your lender. The home inspection checks the condition of the house and protects the borrower from hidden defects. Additionally, you should maintain a cash reserve to cover any unexpected expenses that arise after the closing.
You can also obtain valuable inside knowledge on local real-estate markets from realtors. You should understand that the listing agent on a house works for the seller. To get the maximum benefit of a realtor, you should hire your own realtor to work for you. This creates a fiduciary relationship between you and your realtor that does not exist between you and the seller’s realtor. Having two realtors will not add to the cost of the house since the two realtors will split the commission.
The collapse in home prices has caused many problems within the financial sector of the United States, but for certain individuals it is also a great opportunity. For a prospective buyer who has excellent credit and money for a down payment, there are plenty of opportunities to buy a very nice home at a fire sale price.
March 24, 2009
Enroute from Atlanta to Newark NJ
First, look at the big picture. Examine the industry in which you work and take a close look at how your company is faring. If your industry is particularly unstable, or if your company is considering layoffs or pay cuts, you should be very careful about committing yourself to a mortgage. You should try to minimize the chance that you will not be able to pay your bills by considering the chance that you will be facing unemployment or decrease in pay.
Second, when you start shopping for a home, carefully consider how much you should spend. Traditionally, lenders have desired that a mortgage payment be no more than 25% of borrower’s take-home pay and that all payments be less than 32% of the total take home pay. For example, if you make $5,000 per month after taxes, your mortgage payment, including escrows for homeowner’s insurance and property taxes, should be less than $1250 per month. Similarly, your total monthly obligations, including credit cards, car payments, etc. should be less than $1600 per month. This ensures that there will be plenty of money left over to pay utilities and buy other necessities, such as food and clothing. In the current economic climate, a borrower would be wise to be even more conservative than these traditional guidelines.
In the past, borrowers could finance almost all of the cost of a home. Now, however, mortgages with no money down or small down payments are a thing of the past. To minimize their own risks, most banks are requiring a down payment of at least twenty percent of the sale price. This means that most borrowers will need a sizable nest egg to qualify for a mortgage. Banks normally require that the down payment money be verified over a period of time. For example, it is not uncommon to require six months of bank statements or documentation showing the source of the funds. Gifts are normally acceptable, but it is common to require that the donor complete forms that state that the money is a gift and not a loan. Gifts or abnormal sources of down payments will likely trigger additional scrutiny of loan applications these days.
Shop around to find the best interest rate and down payment. Dealing with a mortgage broker instead of individual banks makes it easier to find the best deal. A major cause of the current crisis is that many people were not fully aware of what type of mortgage they were buying. Ask questions and find out exactly what is being offered. This is particularly important if you are buying an adjustable rate mortgage (ARM). You should find out how much the interest rate can adjust and how much that will increase your payment. Also find out if there is a prepayment penalty or a balloon payment. If you do not understand what you are signing, don’t sign!
The best way to shop for a house is to get pre-approved for a mortgage before you start looking at houses. This way you will know in advance how much the bank is willing to loan and you can shop for houses within your price range. This also makes it easier to close on your house quickly when you find your dream home. Since your finances have already been approved by the lender, only items dealing with your specific house will have to be completed.
When you begin shopping for a house, consider foreclosures and other distressed sales. These homes often sell at deep discounts, but do carry some additional risks. For example, such homes are often sold “as is” with no warranty. Since the previous owner could not afford to make the mortgage payments on the home, it is unlikely that they were able to pay for upkeep and maintenance on the home as well. In some cases, the previous owner may even have vented their frustrations on the house’s windows, walls, and doors. This damage will probably not be repaired by the seller and therefore will add to the real cost of buying the home. If the house has been unoccupied, there may be damage from vandals as well.
To minimize the risk of finding unpleasant surprises in the form of expensive repairs after closing on your new home, it is essential to have both an appraisal and a home inspection done before you buy your home. The appraisal confirms the market value of the home and will likely be required by your lender. The home inspection checks the condition of the house and protects the borrower from hidden defects. Additionally, you should maintain a cash reserve to cover any unexpected expenses that arise after the closing.
You can also obtain valuable inside knowledge on local real-estate markets from realtors. You should understand that the listing agent on a house works for the seller. To get the maximum benefit of a realtor, you should hire your own realtor to work for you. This creates a fiduciary relationship between you and your realtor that does not exist between you and the seller’s realtor. Having two realtors will not add to the cost of the house since the two realtors will split the commission.
The collapse in home prices has caused many problems within the financial sector of the United States, but for certain individuals it is also a great opportunity. For a prospective buyer who has excellent credit and money for a down payment, there are plenty of opportunities to buy a very nice home at a fire sale price.
March 24, 2009
Enroute from Atlanta to Newark NJ
Monday, March 2, 2009
Investing in the Obama Economy
Whether we voted for him or not, we must realize that Barack Obama is going to change the face of the United States and its economy. Radical changes in numerous areas of our economy are causing upheaval in the stock market and investment portfolios. To make the best investment choices, we should look at what Obama plans to do and the likely effects of his policies.
A big question on the minds of most investors is whether to ride out the crashing market or to try and salvage what remains of their portfolios. Since the financial crisis began in September 2008, the Dow Jones Industrial Average has fallen from a high above 13,000 to below 6,800 in trading today (3/2/09). If you are still in the market, you have probably seen a loss of approximately half the value of your portfolio.
A good strategy depends on the length of time that you have to recoup your losses. Historically, the stock market always shows a profit over time. Even in the stock market crash of 1929, when the Dow fell from 380 to 42 as the US entered the Great Depression, the stocks eventually regained their value. The down side is that this takes time. The market did not recover to its pre-1929 values until the late 1950s.
President Obama is following a set of policies that is very similar to those enacted by President Roosevelt in the 1930s and the government of Japan in the 1990s. In both cases, the increased government spending, higher taxes, and increased regulation led to a deeper recession and a slow recovery that took in excess of ten years. What we can learn from this is that, in all likelihood, we may not recover our past losses until 2030.
President Obama’s stimulus and bailouts have not stopped Wall Street’s freefall. With every new bailout and nationalization, the market falls further. Since there is no end in sight to government dabbling in the economy, there is also no bottom in sight to market losses.
If you are someone who needs your investment money in the short term, up to ten years from now, my recommendation is that you consider cutting your losses and get out of the stock market. Your current losses will become permanent, but you will preserve what you have left.
On the other hand, if you will not need your money for twenty to thirty years and are somewhat risk tolerant, you should consider staying in the market. The economy is cyclical and, in spite of everything that we can throw against it, it will recover in time. If a substantial change in government policy occurs over the next few years, the recovery might be sooner and sharper than anyone imagines.
For investors with a middle range outlook, from ten to twenty years, you should talk with your investment advisor about moving at least part of your portfolio to more conservative, less risky investments. You will lock in some losses, but you will also preserve more of your cash in the event of a long recovery.
The next question is what does constitute a safe and conservative investment in this economic climate. To answer this, we should look at what President Obama has announced as his intentions as well as what he has already done in his first six weeks in office. His banking polices, including government purchases of bank stock, have caused the value of bank stocks to crash. Auto stocks have fallen amid government bailouts and increased government control of the industry. Obama’s cap-and-trade energy tax will likely hurt traditional energy companies as well as the many businesses whose operations require energy to produce and transport their products. Health care is likely to be a target for nationalization or price controls in the near future. All of these sectors are likely to be poor investments for the next few years.
In past recessions, investors were able to invest in foreign markets when the domestic economy slowed. The current crisis, however, is worldwide. In spite of the poor performance of the US economy, it still leads that of most of other nations. Russia, Venezuela, and other oil producers have been hit hard by the collapse of oil prices. European nations have banking problems similar to ours and many are constructing their own bailout plans. Countries that depend heavily on US imports, such as China, are suffering from diminished US consumer demand.
On the other hand, a slowing economy does offer some opportunities. As more Americans make do with less, discount retailers are likely to do well. Family Dollar (FDO) is currently trading near its 52 week high, as is Dollar Tree (DLTR). McDonalds (MCD) is another company that has thus far done well in the crisis as people forgo expensive restaurants for the dollar menu.
Another likely growth sector is green energy. Obama’s energy policy will be to force a change from traditional sources of energy to new ones such as wind and solar. Carbon based energy, such as coal and oil, will be targeted by the federal government. During the campaign, Obama himself predicted that his policies would bankrupt companies that try to operate coal power plants. Similarly, companies that focus on ethanol, fuel cells, and hybrid technologies will be good bets. Even if they are not profitable on their own terms, they will be likely to receive substantial government subsidies and contracts.
To make wise investment choices, we must also consider the likelihood of either deflation or inflation. Currently, with a backlog of production, rising unemployment, and flagging consumer confidence, deflation is a threat. Increased government spending can also cause deflation since the government is competing with the private sector for money and, in effect, reducing the money supply.
Deflation occurs when people stop spending, causing the value of goods and services to decline. This may seem like a good thing when prices start to decline until you realize that the value of your property and your savings is declining as well. As goods pile up, companies cut production and lay off workers. Since consumers have less money to spend, they buy even less and more goods pile up. The cycle is a vicious one that can be hard to break. Deflation plagued both the US under the New Deal and Japan in the 1990s.
If the economy does slide into deflation, the values of almost all investments will decline. In a deflationary economy, real estate, commodities, stocks, and bonds are all poor investments. The best investment choice for a deflationary economy is to hold on to your cash.
On the other hand, inflation occurs when prices rise. Many economists believe that inflation is likely in the long term due to large government spending programs funded by debt. To service the interest on this massive debt, the government is likely to have problems generating enough revenue from the sale of government bonds. Other countries, such as China, that buy our debt have their own financial problems. Likewise, US citizens are also saddled with debt and have little left over to invest. If the government cannot raise cash through the sale of bonds, they will be left with little choice but to print more money or default on their loans.
When the government prints more money, basic economics tells us that as the money supply increases, the price (value) of the dollar will decrease. A dollar will buy less and the price of goods will increase. In our recent history, the 1970s was a time of rising inflation and, due to the high cost of capital, stagnant growth. The combination was referred to as “stagflation.” Inflation and unemployment figures were combined into a “misery index” that topped 20% by the time President Carter left office.
While deflation is likely in the short term, it is likely that we will face inflation in the long term. While an inflated dollar might make it easier to repay loans, it also erodes the value of savings and investments. People on fixed incomes are also hurt because their cash flow stream may not be indexed for the real rate of inflation.
In times of inflation, since prices tend to rise, the best investment strategy is to buy things. This strategy works from household items to real estate and commodities. For example, if you know that prices are going to rise and you know that your children will need new clothes and shoes for school next year, you would be better off to buy now before the price rises. Similarly, buying a house at the onset of an inflationary period will see an increase in the value of the house due to the inflationary decline of the dollar.
Commodities, particularly gold, are a traditional refuge during times of inflation. Gold is touted as a hedge against inflation, but because it is a high profile commodity often carries an extra expense. The price of gold is also sometimes manipulated by governments because it is often seen as a referendum on the economy.
Oil is another commodity that traditionally does well during times of inflation. Oil is currently trading at $44 per barrel, down from a high of nearly $150 per barrel in the summer of 2008. A big part of oil’s collapse was due to declining demand as the world’s economy began grinding to a halt. As the recovery eventually begins, demand will increase and the price of oil will recover. Regardless of Obama’s push for alternate energy, most of the world will run on oil for a long time to come.
One final consideration for investing during Obama’s tenure is taxes. Obama has been open about his plans to raise taxes on upper-income taxpayers and it is extremely likely that middle-income families will soon face an increased tax burden as well. Investors should take this into account. Individual Retirement Accounts (IRAs) offer a common means of deferring taxes. Investors should also keep in mind that there are likely to be drastic changes to the tax code. Many tax shelters and deductions are likely to be eliminated as the government tries to increase revenue.
Regardless of how the economy performs, one smart use of your money is to get yourself out of debt. With fewer monthly obligations to meet, you will have more disposable income with which to handle whatever life throws at you. Instead of paying interest to a lender, you’ll either be able to collect interest on investments or buy goods that will appreciate in value. In a time of uncertainty, preparation and savings is the smartest investment.
Disclaimer: I am not a licensed financial advisor. Consult your professional financial advisor before making changes to your portfolio.
Sources:
www.Inflationdata.com
3/2/09
Newark NJ
A big question on the minds of most investors is whether to ride out the crashing market or to try and salvage what remains of their portfolios. Since the financial crisis began in September 2008, the Dow Jones Industrial Average has fallen from a high above 13,000 to below 6,800 in trading today (3/2/09). If you are still in the market, you have probably seen a loss of approximately half the value of your portfolio.
A good strategy depends on the length of time that you have to recoup your losses. Historically, the stock market always shows a profit over time. Even in the stock market crash of 1929, when the Dow fell from 380 to 42 as the US entered the Great Depression, the stocks eventually regained their value. The down side is that this takes time. The market did not recover to its pre-1929 values until the late 1950s.
President Obama is following a set of policies that is very similar to those enacted by President Roosevelt in the 1930s and the government of Japan in the 1990s. In both cases, the increased government spending, higher taxes, and increased regulation led to a deeper recession and a slow recovery that took in excess of ten years. What we can learn from this is that, in all likelihood, we may not recover our past losses until 2030.
President Obama’s stimulus and bailouts have not stopped Wall Street’s freefall. With every new bailout and nationalization, the market falls further. Since there is no end in sight to government dabbling in the economy, there is also no bottom in sight to market losses.
If you are someone who needs your investment money in the short term, up to ten years from now, my recommendation is that you consider cutting your losses and get out of the stock market. Your current losses will become permanent, but you will preserve what you have left.
On the other hand, if you will not need your money for twenty to thirty years and are somewhat risk tolerant, you should consider staying in the market. The economy is cyclical and, in spite of everything that we can throw against it, it will recover in time. If a substantial change in government policy occurs over the next few years, the recovery might be sooner and sharper than anyone imagines.
For investors with a middle range outlook, from ten to twenty years, you should talk with your investment advisor about moving at least part of your portfolio to more conservative, less risky investments. You will lock in some losses, but you will also preserve more of your cash in the event of a long recovery.
The next question is what does constitute a safe and conservative investment in this economic climate. To answer this, we should look at what President Obama has announced as his intentions as well as what he has already done in his first six weeks in office. His banking polices, including government purchases of bank stock, have caused the value of bank stocks to crash. Auto stocks have fallen amid government bailouts and increased government control of the industry. Obama’s cap-and-trade energy tax will likely hurt traditional energy companies as well as the many businesses whose operations require energy to produce and transport their products. Health care is likely to be a target for nationalization or price controls in the near future. All of these sectors are likely to be poor investments for the next few years.
In past recessions, investors were able to invest in foreign markets when the domestic economy slowed. The current crisis, however, is worldwide. In spite of the poor performance of the US economy, it still leads that of most of other nations. Russia, Venezuela, and other oil producers have been hit hard by the collapse of oil prices. European nations have banking problems similar to ours and many are constructing their own bailout plans. Countries that depend heavily on US imports, such as China, are suffering from diminished US consumer demand.
On the other hand, a slowing economy does offer some opportunities. As more Americans make do with less, discount retailers are likely to do well. Family Dollar (FDO) is currently trading near its 52 week high, as is Dollar Tree (DLTR). McDonalds (MCD) is another company that has thus far done well in the crisis as people forgo expensive restaurants for the dollar menu.
Another likely growth sector is green energy. Obama’s energy policy will be to force a change from traditional sources of energy to new ones such as wind and solar. Carbon based energy, such as coal and oil, will be targeted by the federal government. During the campaign, Obama himself predicted that his policies would bankrupt companies that try to operate coal power plants. Similarly, companies that focus on ethanol, fuel cells, and hybrid technologies will be good bets. Even if they are not profitable on their own terms, they will be likely to receive substantial government subsidies and contracts.
To make wise investment choices, we must also consider the likelihood of either deflation or inflation. Currently, with a backlog of production, rising unemployment, and flagging consumer confidence, deflation is a threat. Increased government spending can also cause deflation since the government is competing with the private sector for money and, in effect, reducing the money supply.
Deflation occurs when people stop spending, causing the value of goods and services to decline. This may seem like a good thing when prices start to decline until you realize that the value of your property and your savings is declining as well. As goods pile up, companies cut production and lay off workers. Since consumers have less money to spend, they buy even less and more goods pile up. The cycle is a vicious one that can be hard to break. Deflation plagued both the US under the New Deal and Japan in the 1990s.
If the economy does slide into deflation, the values of almost all investments will decline. In a deflationary economy, real estate, commodities, stocks, and bonds are all poor investments. The best investment choice for a deflationary economy is to hold on to your cash.
On the other hand, inflation occurs when prices rise. Many economists believe that inflation is likely in the long term due to large government spending programs funded by debt. To service the interest on this massive debt, the government is likely to have problems generating enough revenue from the sale of government bonds. Other countries, such as China, that buy our debt have their own financial problems. Likewise, US citizens are also saddled with debt and have little left over to invest. If the government cannot raise cash through the sale of bonds, they will be left with little choice but to print more money or default on their loans.
When the government prints more money, basic economics tells us that as the money supply increases, the price (value) of the dollar will decrease. A dollar will buy less and the price of goods will increase. In our recent history, the 1970s was a time of rising inflation and, due to the high cost of capital, stagnant growth. The combination was referred to as “stagflation.” Inflation and unemployment figures were combined into a “misery index” that topped 20% by the time President Carter left office.
While deflation is likely in the short term, it is likely that we will face inflation in the long term. While an inflated dollar might make it easier to repay loans, it also erodes the value of savings and investments. People on fixed incomes are also hurt because their cash flow stream may not be indexed for the real rate of inflation.
In times of inflation, since prices tend to rise, the best investment strategy is to buy things. This strategy works from household items to real estate and commodities. For example, if you know that prices are going to rise and you know that your children will need new clothes and shoes for school next year, you would be better off to buy now before the price rises. Similarly, buying a house at the onset of an inflationary period will see an increase in the value of the house due to the inflationary decline of the dollar.
Commodities, particularly gold, are a traditional refuge during times of inflation. Gold is touted as a hedge against inflation, but because it is a high profile commodity often carries an extra expense. The price of gold is also sometimes manipulated by governments because it is often seen as a referendum on the economy.
Oil is another commodity that traditionally does well during times of inflation. Oil is currently trading at $44 per barrel, down from a high of nearly $150 per barrel in the summer of 2008. A big part of oil’s collapse was due to declining demand as the world’s economy began grinding to a halt. As the recovery eventually begins, demand will increase and the price of oil will recover. Regardless of Obama’s push for alternate energy, most of the world will run on oil for a long time to come.
One final consideration for investing during Obama’s tenure is taxes. Obama has been open about his plans to raise taxes on upper-income taxpayers and it is extremely likely that middle-income families will soon face an increased tax burden as well. Investors should take this into account. Individual Retirement Accounts (IRAs) offer a common means of deferring taxes. Investors should also keep in mind that there are likely to be drastic changes to the tax code. Many tax shelters and deductions are likely to be eliminated as the government tries to increase revenue.
Regardless of how the economy performs, one smart use of your money is to get yourself out of debt. With fewer monthly obligations to meet, you will have more disposable income with which to handle whatever life throws at you. Instead of paying interest to a lender, you’ll either be able to collect interest on investments or buy goods that will appreciate in value. In a time of uncertainty, preparation and savings is the smartest investment.
Disclaimer: I am not a licensed financial advisor. Consult your professional financial advisor before making changes to your portfolio.
Sources:
www.Inflationdata.com
3/2/09
Newark NJ
Saturday, February 28, 2009
Why Is This Happening?
Much has been written over the past several months about the causes of the financial crisis. Estimates of blame have ranged from government interference with mortgage markets to lack of oversight by federal regulators to old-fashioned greed run amok. Fewer have looked deeper, however, to explore just why the financial crisis struck when it did, as our nation faced an external threat from a loose alliance of Islamic radicals who aim to spread their religion around the world as well as an election in which the country was asked to choose between a traditional moderate and a charismatic newcomer who aimed to remake America in the image of the European social democracies.
A key to understanding the full significance of the challenge before us is to look beyond the economic and geopolitical realities that are all that most people ever see. Author Joel Rosenberg refers to this as looking through a “third lens,” one that allows us to see the world in terms of scriptural and prophetic realities. The fact that these realities are not as readily apparent as economic and political concerns does not make them any less real.
Without full awareness of the fact, I have been looking through the third lens for most of my life. I was raised in a Christian family where discussions of faith were neither pressured nor discouraged. As I grew older, I did question the validity of the Bible and was able to confirm its authenticity to my satisfaction through books such as Lee Strobel’s The Case for Christ and Werner Keller’s The Bible As History among others. The fundamental truths of the Bible, such as the fact that there is an unseen war between good and evil that rages around us, are not in doubt for me.
My study of the Bible included a look at Biblical prophecies, since, if the prophecies were inaccurate, I reasoned, the Bible’s validity would be suspect. In the course of reading the prophetic books of the Bible, I read the Revelation, the last book of the Bible. To me, it seemed that the book was nearly incomprehensible as it was filled with apocryphal (symbolic) language. In effect, much of the Revelation was written in code. As I read other books on the subject, I learned that much of the code could be broken by reading other parts of the Bible. Along the way, I prayed for enlightenment.
Over the past few years, I have incorporated much of what I have learned into my blog articles. As I studied, it seemed that many of the prophecies of Revelation, as well as other books of the Bible, seemed to be on the cusp of being fulfilled. A key prophecy was given by Jesus Himself in Matthew 24:34 when seemed to say that the generation that saw the rebirth of the nation of Israel would see the end of the age (http://captainkudzu.blogspot.com/2007/12/signs-of-times.html). I also noticed that many of the Bible’s prophecies of the end-times seemed to point toward a prominent Muslim role in the latter days (http://captainkudzu.blogspot.com/2007/10/islam-and-revelation.html).
About the same time, I became aware of Joel Rosenberg. Rosenberg wrote a series of novels, beginning with The Last Jihad that contained remarkably accurate predictions of events that happened in the real world almost simultaneously with the publication of his books. His predictions had included a terrorist attack on the US using hijacked airplanes, the death of Yasir Arafat, and a second war with Iraq. Rosenberg soon published a nonfiction book, Epicenter: How the Rumblings in the Middle East Affect Your Future that detailed where he got the inspiration for his fictional works (http://captainkudzu.blogspot.com/2007/10/joel-c.html).
It turned out that Rosenberg’s inspiration was a little known prophecy from the book of Ezekiel. In chapters 38-39 of Ezekiel, the Bible foretells a future war against Israel by a coalition led by Magog and Persia. While the identity of Persia is certainly Iran, most theologians believe that Magog is Russia (http://captainkudzu.blogspot.com/2008/11/who-is-gog-of-magog.html).
Over the past few years, we have seen the pieces for the Magog war fall into place. A few years ago, Russia was written off as a second-rate power. Now it is resurgent as military and economic power. Vladimir Putin has strengthened his control over the country and is now a de facto dictator, if not a latter day tsar, ruling from the behind the scenes. Russia’s desire for imperial expansion can be seen in its recent dealings with the Ukraine and its 2008 invasion of Georgia.
Iran has been in the news as well. Iran’s nuclear ambitions have been a source of international concern for years now. In February 2009, the UN acknowledged that Iran probably has enough uranium to create a nuclear weapon. Additionally, Iran has tested rockets capable of boosting satellites, or nuclear warheads, into orbit. Iran’s rulers have left little doubt that, if they acquire a nuclear weapon, their goal would be to eliminate Israel and the United States. Their belief in the Twelfth Imam calls for them to create chaos in order to have the Mahdi appear to usher in a worldwide Islamic caliphate.
The two nations have already begun forging ties. Russia is supplying reactors for Iran’s nuclear program as well as sophisticated air defense systems to protect them from Israeli or American attack. Russia has also used its position on the UN Security Council to prevent meaningful UN action against Iran.
The list of nations that Ezekiel tells us will join the coalition against Israel is long, but there are two notable absences: Iraq and Egypt. Both nations have taken part in the other major wars against Israel, but both have legitimate reasons for opting out of this future conflict. Egypt and Israel have been at peace since Egypt’s President Anwar Sadat and Israeli Prime Minister Menachem Begin signed the Camp David Accords in 1979. On the other hand, Iraq is still hostile to Israel, but its military was destroyed in the 2003 US invasion. It is currently more concerned with internal security than with liberating Jerusalem. Incidentally, Babylon, mentioned in Revelation as the seat of power of a demonic world ruler, is in Iraq and is currently being rebuilt.
Other factors that may point toward a prophetic event include a spiritual awakening occurring in Muslim countries in which people who have never heard of Jesus experience supernatural dreams and visions that convince them that Isa, the Arabic name for Jesus, is the Son of God (http://captainkudzu.blogspot.com/2008/10/visions-of-isa-muslim-converts-to.html). Although missionaries have preached the Gospel to Muslims for hundreds of years, it is only in the last twenty to thirty years that Christianity has seen explosive growth in these countries.
More circumstantial is the fact that the Magog prophecy is sandwiched between prophecies of the rebirth of Israel (Ezekiel 37) and the construction of a new Jewish temple (Ezekiel 40-48). There is currently no Jewish temple because its traditional site is located on the same spot as the Dome of the Rock mosque in Jerusalem. To dismantle this mosque would touch off a holy war of worldwide proportions. If, however, the mosque faced divine destruction, the path would open for the Jews to rebuild their temple. Though Israel has controlled Jerusalem since 1967, the Temple Mount remains in Arab hands. A group of Israeli Jews, the Temple Mount Faithful, believes this will change one day soon and is prepared to start construction on a new temple in short order.
As I watched Rosenberg’s books come true in the pages of the newspaper, I made a few predictions of my own. Well before the Democratic primary was settled, I predicted that Barack Obama would become president, that the US economy would soon be in severe trouble, and that Iraq would become relatively peaceful and stable with the help of US troops, which would remain well into Obama’s presidency (http://captainkudzu.blogspot.com/2008/03/speculating-on-end-of-world-as-we-know.html). The basis for these predictions was a spiritual worldview that seemed to indicate that the stage was being set for a fulfillment of Ezekiel’s prophecy. (To be fair, I also believed that either Israel or the US would attack Iran before Obama took office. I based this prediction on an assessment of George W. Bush’s character, rather than scripture, however) (http://captainkudzu.blogspot.com/2008/08/coming-war-with-iran.html).
My predictions were based on the belief that it was possible that God was preparing for fulfillment of Ezekiel’s prophecy. Ezekiel indicates that Israel will stand alone against the coalition in order to show His power to the world (Ezekiel 38:22). The question then became one of what would prevent the United States, Israel’s most trusted ally, from either taking action in the United Nations to halt the attack or from providing military aid. The most likely answers were a shift in the US position to one that was less favorable to Israel or the possibility that the US was pre-occupied with some other problem.
In recent years, the public mood of the US has started to shift away from Israel, especially on the left. For example, news reports focus on the accidental deaths of Arab civilians while all but ignoring the terror bombings and a steady stream of rocket attacks that kill and maim Israelis, both Jewish and Muslim. This shift culminated in the election of Barack Obama, who claimed during the campaign to support Israel’s right to defend herself, but who nevertheless is rumored to have strongly pro-Arab sympathies and who is unlikely to commit more US troops to defend Israel in another Middle East war.
Additionally, the current deteriorating state of the financial system of the US and the world makes it likely that the US would be too inwardly focused to respond to a rapidly escalating crisis in Israel. The situation is similar to how the US focus on the Great Depression distracted us from the rise of Nazi Germany and Imperial Japan. With federal deficit ballooning under emergency stimulus spending, cuts in the defense budget are likely under Democratic rule. When the crisis comes, the US may have little support left to give.
An additional reason to believe that the United States has a difficult future is that we, as a nation, have been courting God’s judgment for years. The Bible says to flee from sexual immorality (I Corinthians 6:18), but in America we have embraced almost every sexual perversion imaginable from pornography to infidelity to homosexuality. Jesus said that the kingdom of heaven belongs to the little children (Matthew 19:14), yet in America we kill hundreds of thousands of unborn babies each year. In many ways, modern abortion is akin to the ancient practice of sacrificing children in the fires of pagan gods. Finally, even though statistics show that a majority of Americans believe in some sort of God, we allow a vocal minority to force the removal of nearly all aspects of Christianity and God from public life. This is tantamount to a national rejection of God.
Throughout our history, Americans have typically believed that God was instrumental in our founding and that God had a special plan for the United States. From our nation’s inception, we saw ourselves as the possessors of a manifest destiny to spread the gospels of Christ and democracy around the world. Because of our special national relationship with God, many fail to believe that God will punish our nation. Such beliefs fly in the face of history. The ancient Jews of Israel and Judah believed that since they were God’s chosen people, the nation that watched over His temple, that they were immune from God’s judgment. In the end, however, both nations were annihilated by pagan powers, Israel by the Assyrians in 720 BC and Judah by the Babylonians in 586 BC. Israel then ceased to exist as a nation until AD 1947. The Bible repeats that God is slow to anger, but also states that He is unable to ignore sin and rebellion indefinitely (Numbers 14:18). As someone once said, if God fails to judge America, He owes Sodom and Gomorra an apology.
While it is by no means certain that my theories about God’s judgment on America and the fulfillment of the Magog prophecy are accurate, many of the details seem to fit together extremely well. Coincidences do happen, but at some point, it takes more faith to believe in coincidence than in God’s divine plan coming to fruition. With prophecies and signs from all three of the world’s major religions pointing toward a worldwide upheaval, the notion of a string of coincidences becomes harder to accept. If the theory of prophetic judgment is correct, what action should we take?
First, I do believe that God is forgiving. A passage of scripture that has become popular in recent years is 2 Chronicles 7:14 which states that “if My people who are called by My name will humble themselves, and pray and seek My face, and turn from their wicked ways, then I will hear from heaven, and will forgive their sin and heal their land.”
This belief is supported by the story of Josiah, one of the last godly kings of Judah. During Josiah’s reign, a lost copy of the scriptures was discovered in the temple (2 Kings 22-23). When Josiah read the scripture, he learned that much of what he thought he knew was wrong. He inquired of the Lord through a prophetess and learned that destruction of his country was imminent. Josiah went about removing the pagan cults from Judah and returning his people to worship of God. In the end, Josiah was successful in staving off God’s judgment temporarily. Tragically, after Josiah’s death, Judah returned to its idolatrous and evil ways.
On an individual basis, the most important thing is to entrust your life to Jesus Christ. Whether judgment comes tonight or a thousand years from now, we all must answer for our sins. My life has not been bad by human standards. I don’t have a history of crime, drug abuse, or some other sordid past like many who testify to how Christ changed their lives. However, in God’s eyes, even little sins are punishable by death if we do not choose to accept His forgiveness.
Additionally, another change that I have made as I realized the possibility of dramatic changes to come, is to move to a church that is more interested in evangelical outreach than my former church. (Incidentally, I don’t believe that I’ve heard my pastor preach on end-time prophecies at all. Hear his sermons on your Ipod at http://peachtreecc.org/). Regardless of whether we are living in the last days or not, people in this country and around the world can benefit from a relationship with Jesus Christ. The fact is that one of the few commandments that Christians face is the Great Commission to “go and make disciples of all nations, baptizing them in the name of the Father and of the Son and of the Holy Spirit,” given by Jesus Himself (Matthew 28:19-20). This doesn’t mean to go out and beat people over the head with a Bible. It does mean to share the Gospel and what it means to us so that they can make their own decision.
If fulfillment of Ezekiel’s prophecy does come to pass, the Russian-Iranian coalition will be destroyed as God intervenes to save Israel from certain destruction (Ezekiel 38:19-23). Following a great earthquake, fire and hailstones from heaven will destroy the attacking army. It will be apparent to the entire world that God not only exists, but is in total control. I hope that people reading this who choose not to accept Christ will remember reading this and remember that the entire event was written down almost three thousand years ago by a prophet of God.
2/27/09
Scottsdale AZ
A key to understanding the full significance of the challenge before us is to look beyond the economic and geopolitical realities that are all that most people ever see. Author Joel Rosenberg refers to this as looking through a “third lens,” one that allows us to see the world in terms of scriptural and prophetic realities. The fact that these realities are not as readily apparent as economic and political concerns does not make them any less real.
Without full awareness of the fact, I have been looking through the third lens for most of my life. I was raised in a Christian family where discussions of faith were neither pressured nor discouraged. As I grew older, I did question the validity of the Bible and was able to confirm its authenticity to my satisfaction through books such as Lee Strobel’s The Case for Christ and Werner Keller’s The Bible As History among others. The fundamental truths of the Bible, such as the fact that there is an unseen war between good and evil that rages around us, are not in doubt for me.
My study of the Bible included a look at Biblical prophecies, since, if the prophecies were inaccurate, I reasoned, the Bible’s validity would be suspect. In the course of reading the prophetic books of the Bible, I read the Revelation, the last book of the Bible. To me, it seemed that the book was nearly incomprehensible as it was filled with apocryphal (symbolic) language. In effect, much of the Revelation was written in code. As I read other books on the subject, I learned that much of the code could be broken by reading other parts of the Bible. Along the way, I prayed for enlightenment.
Over the past few years, I have incorporated much of what I have learned into my blog articles. As I studied, it seemed that many of the prophecies of Revelation, as well as other books of the Bible, seemed to be on the cusp of being fulfilled. A key prophecy was given by Jesus Himself in Matthew 24:34 when seemed to say that the generation that saw the rebirth of the nation of Israel would see the end of the age (http://captainkudzu.blogspot.com/2007/12/signs-of-times.html). I also noticed that many of the Bible’s prophecies of the end-times seemed to point toward a prominent Muslim role in the latter days (http://captainkudzu.blogspot.com/2007/10/islam-and-revelation.html).
About the same time, I became aware of Joel Rosenberg. Rosenberg wrote a series of novels, beginning with The Last Jihad that contained remarkably accurate predictions of events that happened in the real world almost simultaneously with the publication of his books. His predictions had included a terrorist attack on the US using hijacked airplanes, the death of Yasir Arafat, and a second war with Iraq. Rosenberg soon published a nonfiction book, Epicenter: How the Rumblings in the Middle East Affect Your Future that detailed where he got the inspiration for his fictional works (http://captainkudzu.blogspot.com/2007/10/joel-c.html).
It turned out that Rosenberg’s inspiration was a little known prophecy from the book of Ezekiel. In chapters 38-39 of Ezekiel, the Bible foretells a future war against Israel by a coalition led by Magog and Persia. While the identity of Persia is certainly Iran, most theologians believe that Magog is Russia (http://captainkudzu.blogspot.com/2008/11/who-is-gog-of-magog.html).
Over the past few years, we have seen the pieces for the Magog war fall into place. A few years ago, Russia was written off as a second-rate power. Now it is resurgent as military and economic power. Vladimir Putin has strengthened his control over the country and is now a de facto dictator, if not a latter day tsar, ruling from the behind the scenes. Russia’s desire for imperial expansion can be seen in its recent dealings with the Ukraine and its 2008 invasion of Georgia.
Iran has been in the news as well. Iran’s nuclear ambitions have been a source of international concern for years now. In February 2009, the UN acknowledged that Iran probably has enough uranium to create a nuclear weapon. Additionally, Iran has tested rockets capable of boosting satellites, or nuclear warheads, into orbit. Iran’s rulers have left little doubt that, if they acquire a nuclear weapon, their goal would be to eliminate Israel and the United States. Their belief in the Twelfth Imam calls for them to create chaos in order to have the Mahdi appear to usher in a worldwide Islamic caliphate.
The two nations have already begun forging ties. Russia is supplying reactors for Iran’s nuclear program as well as sophisticated air defense systems to protect them from Israeli or American attack. Russia has also used its position on the UN Security Council to prevent meaningful UN action against Iran.
The list of nations that Ezekiel tells us will join the coalition against Israel is long, but there are two notable absences: Iraq and Egypt. Both nations have taken part in the other major wars against Israel, but both have legitimate reasons for opting out of this future conflict. Egypt and Israel have been at peace since Egypt’s President Anwar Sadat and Israeli Prime Minister Menachem Begin signed the Camp David Accords in 1979. On the other hand, Iraq is still hostile to Israel, but its military was destroyed in the 2003 US invasion. It is currently more concerned with internal security than with liberating Jerusalem. Incidentally, Babylon, mentioned in Revelation as the seat of power of a demonic world ruler, is in Iraq and is currently being rebuilt.
Other factors that may point toward a prophetic event include a spiritual awakening occurring in Muslim countries in which people who have never heard of Jesus experience supernatural dreams and visions that convince them that Isa, the Arabic name for Jesus, is the Son of God (http://captainkudzu.blogspot.com/2008/10/visions-of-isa-muslim-converts-to.html). Although missionaries have preached the Gospel to Muslims for hundreds of years, it is only in the last twenty to thirty years that Christianity has seen explosive growth in these countries.
More circumstantial is the fact that the Magog prophecy is sandwiched between prophecies of the rebirth of Israel (Ezekiel 37) and the construction of a new Jewish temple (Ezekiel 40-48). There is currently no Jewish temple because its traditional site is located on the same spot as the Dome of the Rock mosque in Jerusalem. To dismantle this mosque would touch off a holy war of worldwide proportions. If, however, the mosque faced divine destruction, the path would open for the Jews to rebuild their temple. Though Israel has controlled Jerusalem since 1967, the Temple Mount remains in Arab hands. A group of Israeli Jews, the Temple Mount Faithful, believes this will change one day soon and is prepared to start construction on a new temple in short order.
As I watched Rosenberg’s books come true in the pages of the newspaper, I made a few predictions of my own. Well before the Democratic primary was settled, I predicted that Barack Obama would become president, that the US economy would soon be in severe trouble, and that Iraq would become relatively peaceful and stable with the help of US troops, which would remain well into Obama’s presidency (http://captainkudzu.blogspot.com/2008/03/speculating-on-end-of-world-as-we-know.html). The basis for these predictions was a spiritual worldview that seemed to indicate that the stage was being set for a fulfillment of Ezekiel’s prophecy. (To be fair, I also believed that either Israel or the US would attack Iran before Obama took office. I based this prediction on an assessment of George W. Bush’s character, rather than scripture, however) (http://captainkudzu.blogspot.com/2008/08/coming-war-with-iran.html).
My predictions were based on the belief that it was possible that God was preparing for fulfillment of Ezekiel’s prophecy. Ezekiel indicates that Israel will stand alone against the coalition in order to show His power to the world (Ezekiel 38:22). The question then became one of what would prevent the United States, Israel’s most trusted ally, from either taking action in the United Nations to halt the attack or from providing military aid. The most likely answers were a shift in the US position to one that was less favorable to Israel or the possibility that the US was pre-occupied with some other problem.
In recent years, the public mood of the US has started to shift away from Israel, especially on the left. For example, news reports focus on the accidental deaths of Arab civilians while all but ignoring the terror bombings and a steady stream of rocket attacks that kill and maim Israelis, both Jewish and Muslim. This shift culminated in the election of Barack Obama, who claimed during the campaign to support Israel’s right to defend herself, but who nevertheless is rumored to have strongly pro-Arab sympathies and who is unlikely to commit more US troops to defend Israel in another Middle East war.
Additionally, the current deteriorating state of the financial system of the US and the world makes it likely that the US would be too inwardly focused to respond to a rapidly escalating crisis in Israel. The situation is similar to how the US focus on the Great Depression distracted us from the rise of Nazi Germany and Imperial Japan. With federal deficit ballooning under emergency stimulus spending, cuts in the defense budget are likely under Democratic rule. When the crisis comes, the US may have little support left to give.
An additional reason to believe that the United States has a difficult future is that we, as a nation, have been courting God’s judgment for years. The Bible says to flee from sexual immorality (I Corinthians 6:18), but in America we have embraced almost every sexual perversion imaginable from pornography to infidelity to homosexuality. Jesus said that the kingdom of heaven belongs to the little children (Matthew 19:14), yet in America we kill hundreds of thousands of unborn babies each year. In many ways, modern abortion is akin to the ancient practice of sacrificing children in the fires of pagan gods. Finally, even though statistics show that a majority of Americans believe in some sort of God, we allow a vocal minority to force the removal of nearly all aspects of Christianity and God from public life. This is tantamount to a national rejection of God.
Throughout our history, Americans have typically believed that God was instrumental in our founding and that God had a special plan for the United States. From our nation’s inception, we saw ourselves as the possessors of a manifest destiny to spread the gospels of Christ and democracy around the world. Because of our special national relationship with God, many fail to believe that God will punish our nation. Such beliefs fly in the face of history. The ancient Jews of Israel and Judah believed that since they were God’s chosen people, the nation that watched over His temple, that they were immune from God’s judgment. In the end, however, both nations were annihilated by pagan powers, Israel by the Assyrians in 720 BC and Judah by the Babylonians in 586 BC. Israel then ceased to exist as a nation until AD 1947. The Bible repeats that God is slow to anger, but also states that He is unable to ignore sin and rebellion indefinitely (Numbers 14:18). As someone once said, if God fails to judge America, He owes Sodom and Gomorra an apology.
While it is by no means certain that my theories about God’s judgment on America and the fulfillment of the Magog prophecy are accurate, many of the details seem to fit together extremely well. Coincidences do happen, but at some point, it takes more faith to believe in coincidence than in God’s divine plan coming to fruition. With prophecies and signs from all three of the world’s major religions pointing toward a worldwide upheaval, the notion of a string of coincidences becomes harder to accept. If the theory of prophetic judgment is correct, what action should we take?
First, I do believe that God is forgiving. A passage of scripture that has become popular in recent years is 2 Chronicles 7:14 which states that “if My people who are called by My name will humble themselves, and pray and seek My face, and turn from their wicked ways, then I will hear from heaven, and will forgive their sin and heal their land.”
This belief is supported by the story of Josiah, one of the last godly kings of Judah. During Josiah’s reign, a lost copy of the scriptures was discovered in the temple (2 Kings 22-23). When Josiah read the scripture, he learned that much of what he thought he knew was wrong. He inquired of the Lord through a prophetess and learned that destruction of his country was imminent. Josiah went about removing the pagan cults from Judah and returning his people to worship of God. In the end, Josiah was successful in staving off God’s judgment temporarily. Tragically, after Josiah’s death, Judah returned to its idolatrous and evil ways.
On an individual basis, the most important thing is to entrust your life to Jesus Christ. Whether judgment comes tonight or a thousand years from now, we all must answer for our sins. My life has not been bad by human standards. I don’t have a history of crime, drug abuse, or some other sordid past like many who testify to how Christ changed their lives. However, in God’s eyes, even little sins are punishable by death if we do not choose to accept His forgiveness.
Additionally, another change that I have made as I realized the possibility of dramatic changes to come, is to move to a church that is more interested in evangelical outreach than my former church. (Incidentally, I don’t believe that I’ve heard my pastor preach on end-time prophecies at all. Hear his sermons on your Ipod at http://peachtreecc.org/). Regardless of whether we are living in the last days or not, people in this country and around the world can benefit from a relationship with Jesus Christ. The fact is that one of the few commandments that Christians face is the Great Commission to “go and make disciples of all nations, baptizing them in the name of the Father and of the Son and of the Holy Spirit,” given by Jesus Himself (Matthew 28:19-20). This doesn’t mean to go out and beat people over the head with a Bible. It does mean to share the Gospel and what it means to us so that they can make their own decision.
If fulfillment of Ezekiel’s prophecy does come to pass, the Russian-Iranian coalition will be destroyed as God intervenes to save Israel from certain destruction (Ezekiel 38:19-23). Following a great earthquake, fire and hailstones from heaven will destroy the attacking army. It will be apparent to the entire world that God not only exists, but is in total control. I hope that people reading this who choose not to accept Christ will remember reading this and remember that the entire event was written down almost three thousand years ago by a prophet of God.
2/27/09
Scottsdale AZ
Sunday, February 15, 2009
Twenty Predictions for the Next Few Years
After observing Obama and the new Congress for almost a month, I am now ready to make my predictions for the next few years. With a few exceptions, these predictions are based on the history of the United States and other countries that have enacted similar programs. These predictions are mostly brief statements, but some have been or will be elaborated on in my blog (captainkudzu.blogspot.com). So take note and if I’m right, remember it. If not, I’ll probably be even happier than you.
If you disagree, feel free to leave a comment with your own predictions.
1. The current stimulus bill will fail, just as the TARP program and the 2008 stimulus checks failed.
2. When the current stimulus bill fails, the government’s solution will be enact another, probably larger, stimulus bill.
3. Massive government spending will create high inflation as the government prints money to pay its debts.
4. The government will also raise taxes. They may not call it raising taxes. They may call it “allowing the Bush tax cuts to expire,” but most Americans who pay taxes will be keeping less of their own money.
5. The recession will be long and the recovery will be slow.
6. Job creation will be stagnant in most sectors of the economy. Government jobs will be an exception.
7. Unemployment will continue to remain at or above current levels for the next several years.
8. A nationalized healthcare system will be enacted in some form.
9. There will be new restrictions on guns and ammunition.
10. There will be at least one terrorist attack on US soil.
11. Iran will obtain a nuclear weapon.
12. Iran’s announcement may come in the form of an attack on Israel. Even Iran does not attack, it will cause an increase in tensions in the Middle East.
13. The slow economy will keep oil prices fairly low for the next few years unless/until an Iran-Israel war drives prices higher.
14. A federal carbon tax, probably in the form of a cap-and-trade system, will drive energy prices, including electric bills, higher.
15. The carbon tax will also drive the prices of other goods and services higher, due to increased production costs.
16. An attempt will be made to censor conservative media with a revived Fairness Doctrine, although it probably will have a different name.
17. The situation in Pakistan will continue to deteriorate. Militants from Afghanistan will flee across the border to safe havens there.
18. The Republicans will make large gains in the 2010 elections, possibly taking control of one or both houses of Congress.
19. The Democratic Party will become fragmented as moderate Blue Dog Democrats are pressured to support increasingly leftist legislation and their constituents become more and more angry.
20. By the time he leaves office, President Obama will have an approval rating that is equal to or lower than President George W. Bush’s approval rating at that future time.
2/15/09
Orlando FL
If you disagree, feel free to leave a comment with your own predictions.
1. The current stimulus bill will fail, just as the TARP program and the 2008 stimulus checks failed.
2. When the current stimulus bill fails, the government’s solution will be enact another, probably larger, stimulus bill.
3. Massive government spending will create high inflation as the government prints money to pay its debts.
4. The government will also raise taxes. They may not call it raising taxes. They may call it “allowing the Bush tax cuts to expire,” but most Americans who pay taxes will be keeping less of their own money.
5. The recession will be long and the recovery will be slow.
6. Job creation will be stagnant in most sectors of the economy. Government jobs will be an exception.
7. Unemployment will continue to remain at or above current levels for the next several years.
8. A nationalized healthcare system will be enacted in some form.
9. There will be new restrictions on guns and ammunition.
10. There will be at least one terrorist attack on US soil.
11. Iran will obtain a nuclear weapon.
12. Iran’s announcement may come in the form of an attack on Israel. Even Iran does not attack, it will cause an increase in tensions in the Middle East.
13. The slow economy will keep oil prices fairly low for the next few years unless/until an Iran-Israel war drives prices higher.
14. A federal carbon tax, probably in the form of a cap-and-trade system, will drive energy prices, including electric bills, higher.
15. The carbon tax will also drive the prices of other goods and services higher, due to increased production costs.
16. An attempt will be made to censor conservative media with a revived Fairness Doctrine, although it probably will have a different name.
17. The situation in Pakistan will continue to deteriorate. Militants from Afghanistan will flee across the border to safe havens there.
18. The Republicans will make large gains in the 2010 elections, possibly taking control of one or both houses of Congress.
19. The Democratic Party will become fragmented as moderate Blue Dog Democrats are pressured to support increasingly leftist legislation and their constituents become more and more angry.
20. By the time he leaves office, President Obama will have an approval rating that is equal to or lower than President George W. Bush’s approval rating at that future time.
2/15/09
Orlando FL
Friday, February 13, 2009
Who Was Herod?
One of the most famous villains of the Bible is King Herod. Herod was the evil king who felt threatened enough by the news of the birth of the King of the Jews that he ordered the mass murder of male children of his realm (Matthew 2:16-18). As I read the Christmas story recently, I wondered what historians know about Herod outside of the Biblical account.
There was actually more than one King Herod. Herod the Great spawned a dynasty that ruled Jerusalem and its surrounding area for decades. Since the date of Jesus’ birth is not precisely known, there is some doubt as to the identity of the Herod that was in power at the time.
The first Herod, Herod the Great, was a Jew who curried the favor of the Romans. He was named King of Judea by the Roman Senate in 40 BC. Herod the Great reigned until his death in 4 BC and was marked by extensive building programs and cold-blooded killings of people who challenged his rule. Among his construction projects were a rebuilt Jewish temple (called Herod’s Temple), the Fortress Antonia (which was named for Mark Antony), new city walls of Jerusalem, and the port of Caesarea.
Many of Herod’s subjects hated him. Many of the Jews disliked his Greek culture and his violation of Jewish religious laws. Jews and gentiles both probably disliked his heavy-handed taxation.
Herod the Great was ruthless in his suppression of political rivals as well as religious dissidents and other opposition. In one case, two rabbis and their students removed a golden imperial eagle that Herod had placed in the Jewish temple. Herod had the transgressors burned alive. Herod suffered a lingering illness prior to his death in 4 BC, but before he died, Herod had two of his own sons executed in order to prevent their succession to his throne after his death.
Herod’s realm was divided into three areas controlled by three of his surviving sons after his death. Herod Antipas became ruler of Galilee from 4 BC to AD 39. Herod Antipas is most known for his illegal marriage to Herodias, who had been his sister-in-law as well as his niece. John the Baptist denounced the marriage, prompting Herod Antipas to first imprison John and then have him beheaded (Matthew 14:1-12, Mark 6:14-29, Luke 9:7-9). The Bible tells us that Herod Antipas also had his daughter dance for his guests at a dinner for officials and military commanders, a role that most fathers of the day would not subject their daughters to.
While Herod Antipas may not have ruled at Jesus’ birth, there is no doubt that he was in power at the time of Jesus’ ministry and execution. The Bible tells us that Jesus actually appeared before Herod Antipas before His execution (Luke 23:7-12).
Luke references the governor of Syria and Caesar Augustus (2:1-2). Cross-referencing the reigns of these men with that of the Herods might help to determine which Herod was in power. Caesar Augustus ruled the Roman Empire from 63 BC to AD 14. This length of time encompasses long periods alongside both Herod the Great and Herod Antipas.
Quirinius, the governor of Syria mentioned by Luke, is a more difficult case. The problem is that Quirinius was not the governor of Syria until after the exile of Herod Archelaus in AD 6, according to Josephus, an early Jewish historian. The discrepancy is probably best explained by the possibility that Quirinius took the first census before he was governor. Luke referred to him as “governor” because that was how people knew him as Luke wrote. Quirinius was also responsible for a second census that is mentioned in Acts 5:37. The reign of Quirinius does not help to pinpoint the birth of Jesus.
Ultimately, the Herod ruling at the time of Jesus’ birth and the Bethlehem massacre cannot be conclusively determined. The massacre is not found in historical accounts outside of the Bible, but that should not be surprising. Bethlehem at that time was a tiny village with a small population. Therefore, the death toll may have been smaller than typically believed. Additionally, the murder of innocent children is probably something that Herod would have wanted to cover up. Again, the small size of Bethlehem would have helped to hide the crime.
It is easy to believe that either Herod the Great or Herod Antipas would have ordered the killings of children that they believed might have threatened their rule. Herod the Great had a long history of murdering his political opponents. Herod Antipas would have been a new ruler at the time of Jesus’ birth. Ancient kings commonly killed anyone who had a claim to their throne in order to solidify their rule when they assumed power. Herod Antipas’ executions of John the Baptist and Jesus show that he had few qualms about having his opponents killed. Whichever Herod was ultimately responsible for the massacre at Bethlehem; both were rulers with blood on their hands.
Source:
The Archaeological Study Bible, Zondervan, Grand Rapids, MI, 2005.
Barne’s Notes on the New Testament, Bible Explorer 4, WORDsearch, 2006.
The Case for Christ, Lee Strobel, Zondervan, Grand Rapids, MI, 1998.
www.herod.info, The Catholic Encyclopedia Vol. VII, online edition, 2003
http://www.answers.com/topic/herod-the-great
http://www.livius.org/he-hg/herodians/herod_the_great01.html
http://www.livius.org/he-hg/herodians/herod_antipas.html
http://www.bible-history.com/Herod_Antipas/
2/13/09 Orlando FL
There was actually more than one King Herod. Herod the Great spawned a dynasty that ruled Jerusalem and its surrounding area for decades. Since the date of Jesus’ birth is not precisely known, there is some doubt as to the identity of the Herod that was in power at the time.
The first Herod, Herod the Great, was a Jew who curried the favor of the Romans. He was named King of Judea by the Roman Senate in 40 BC. Herod the Great reigned until his death in 4 BC and was marked by extensive building programs and cold-blooded killings of people who challenged his rule. Among his construction projects were a rebuilt Jewish temple (called Herod’s Temple), the Fortress Antonia (which was named for Mark Antony), new city walls of Jerusalem, and the port of Caesarea.
Many of Herod’s subjects hated him. Many of the Jews disliked his Greek culture and his violation of Jewish religious laws. Jews and gentiles both probably disliked his heavy-handed taxation.
Herod the Great was ruthless in his suppression of political rivals as well as religious dissidents and other opposition. In one case, two rabbis and their students removed a golden imperial eagle that Herod had placed in the Jewish temple. Herod had the transgressors burned alive. Herod suffered a lingering illness prior to his death in 4 BC, but before he died, Herod had two of his own sons executed in order to prevent their succession to his throne after his death.
Herod’s realm was divided into three areas controlled by three of his surviving sons after his death. Herod Antipas became ruler of Galilee from 4 BC to AD 39. Herod Antipas is most known for his illegal marriage to Herodias, who had been his sister-in-law as well as his niece. John the Baptist denounced the marriage, prompting Herod Antipas to first imprison John and then have him beheaded (Matthew 14:1-12, Mark 6:14-29, Luke 9:7-9). The Bible tells us that Herod Antipas also had his daughter dance for his guests at a dinner for officials and military commanders, a role that most fathers of the day would not subject their daughters to.
While Herod Antipas may not have ruled at Jesus’ birth, there is no doubt that he was in power at the time of Jesus’ ministry and execution. The Bible tells us that Jesus actually appeared before Herod Antipas before His execution (Luke 23:7-12).
Luke references the governor of Syria and Caesar Augustus (2:1-2). Cross-referencing the reigns of these men with that of the Herods might help to determine which Herod was in power. Caesar Augustus ruled the Roman Empire from 63 BC to AD 14. This length of time encompasses long periods alongside both Herod the Great and Herod Antipas.
Quirinius, the governor of Syria mentioned by Luke, is a more difficult case. The problem is that Quirinius was not the governor of Syria until after the exile of Herod Archelaus in AD 6, according to Josephus, an early Jewish historian. The discrepancy is probably best explained by the possibility that Quirinius took the first census before he was governor. Luke referred to him as “governor” because that was how people knew him as Luke wrote. Quirinius was also responsible for a second census that is mentioned in Acts 5:37. The reign of Quirinius does not help to pinpoint the birth of Jesus.
Ultimately, the Herod ruling at the time of Jesus’ birth and the Bethlehem massacre cannot be conclusively determined. The massacre is not found in historical accounts outside of the Bible, but that should not be surprising. Bethlehem at that time was a tiny village with a small population. Therefore, the death toll may have been smaller than typically believed. Additionally, the murder of innocent children is probably something that Herod would have wanted to cover up. Again, the small size of Bethlehem would have helped to hide the crime.
It is easy to believe that either Herod the Great or Herod Antipas would have ordered the killings of children that they believed might have threatened their rule. Herod the Great had a long history of murdering his political opponents. Herod Antipas would have been a new ruler at the time of Jesus’ birth. Ancient kings commonly killed anyone who had a claim to their throne in order to solidify their rule when they assumed power. Herod Antipas’ executions of John the Baptist and Jesus show that he had few qualms about having his opponents killed. Whichever Herod was ultimately responsible for the massacre at Bethlehem; both were rulers with blood on their hands.
Source:
The Archaeological Study Bible, Zondervan, Grand Rapids, MI, 2005.
Barne’s Notes on the New Testament, Bible Explorer 4, WORDsearch, 2006.
The Case for Christ, Lee Strobel, Zondervan, Grand Rapids, MI, 1998.
www.herod.info, The Catholic Encyclopedia Vol. VII, online edition, 2003
http://www.answers.com/topic/herod-the-great
http://www.livius.org/he-hg/herodians/herod_the_great01.html
http://www.livius.org/he-hg/herodians/herod_antipas.html
http://www.bible-history.com/Herod_Antipas/
2/13/09 Orlando FL
Thursday, February 5, 2009
Georgia FAIR Tax - Open Letter to My State Senator
Sir:
I am aware of the fact that Georgia is among the many states in the nation facing a financial crisis. We have rising unemployment, a mounting deficit, and falling tax revenues. I spoke with someone in your office today about what I believe may be the solution: A Georgia state version of the FAIR Tax.
If you are unfamiliar with the FAIR Tax, you can find the details at www.fairtax.org. In short, it is a consumption-sales tax that would replace all other state taxes. I believe that it has several advantages that could be immediately recognized.
First, it would provide a favorable tax climate that would attract new business to the state. By eliminating the state income tax on corporations, the Georgia FAIR Tax would draw businesses from other states with higher tax rates. The publicity of being the first state to adopt the FAIR Tax would also be a boon to Georgia's economy.
Second, the monthly pre-bate feature of the Georgia FAIR Tax would help families with breadwinners who are unemployed or earning low incomes. The fact that the FAIR Tax is not applied to used items, but only to new products, would also provide much needed breathing room to many families.
Third, the Georgia FAIR Tax would eliminate state income tax withholding and leave more money in the pockets of Georgia consumers. If consumers have more take-home pay, they will be able to spend more, which will ultimately help to restart the economy.
Finally, because the Georgia FAIR Tax would be paid by anyone who shops in Georgia, it would increase the tax base. Out-of-state residents, vistors, illegal aliens, and others who currently do not pay taxes in Georgia would become part of our tax base. This would ease the tax burden on Georgia families.
Since the FAIR Tax is the brainchild of Georgians John Linder and Neal Boortz, it is only logical that Georgia become the first state to adopt it. Experiments in Ireland and the former eastern bloc countries of Europe have shown the power of tax reform in stimulating economies. I hope that you will consider sponsoring this legislation in Georgia, both to revitalize our economy and show the rest of the United States the way.
Sincerely,
David W. Thornton
I am aware of the fact that Georgia is among the many states in the nation facing a financial crisis. We have rising unemployment, a mounting deficit, and falling tax revenues. I spoke with someone in your office today about what I believe may be the solution: A Georgia state version of the FAIR Tax.
If you are unfamiliar with the FAIR Tax, you can find the details at www.fairtax.org. In short, it is a consumption-sales tax that would replace all other state taxes. I believe that it has several advantages that could be immediately recognized.
First, it would provide a favorable tax climate that would attract new business to the state. By eliminating the state income tax on corporations, the Georgia FAIR Tax would draw businesses from other states with higher tax rates. The publicity of being the first state to adopt the FAIR Tax would also be a boon to Georgia's economy.
Second, the monthly pre-bate feature of the Georgia FAIR Tax would help families with breadwinners who are unemployed or earning low incomes. The fact that the FAIR Tax is not applied to used items, but only to new products, would also provide much needed breathing room to many families.
Third, the Georgia FAIR Tax would eliminate state income tax withholding and leave more money in the pockets of Georgia consumers. If consumers have more take-home pay, they will be able to spend more, which will ultimately help to restart the economy.
Finally, because the Georgia FAIR Tax would be paid by anyone who shops in Georgia, it would increase the tax base. Out-of-state residents, vistors, illegal aliens, and others who currently do not pay taxes in Georgia would become part of our tax base. This would ease the tax burden on Georgia families.
Since the FAIR Tax is the brainchild of Georgians John Linder and Neal Boortz, it is only logical that Georgia become the first state to adopt it. Experiments in Ireland and the former eastern bloc countries of Europe have shown the power of tax reform in stimulating economies. I hope that you will consider sponsoring this legislation in Georgia, both to revitalize our economy and show the rest of the United States the way.
Sincerely,
David W. Thornton
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