Is there an economic crisis on the near-term horizon? The IMF (International Monetary Fund) is warning of potential wide-spread defaults on the $3 trillion in corporate debt in emerging economies.
Low commodity prices are threatening the world's largest commodity and mining operations. Many Chinese bank loans are unlikely to be repaid. Issues with Volkswagen and Deutsche Bank are impacting Germany—the strongest European economy. Many countries have debts which are unsustainable.
In the U.S., money velocity is near record lows, which results in less effective central bank policy. The proportion of the working age population that is in the labor force is at a 38-year low. The U.S. debt is more than $18 trillion and total unfunded liabilities, which include social security and other obligations, exceed $100 trillion. If interest rates rise, which they will eventually, budget deficits and debt problems will increase. A host of other factors could also cause problems.
Current domestic and global conditions almost ensure a severe recession or worse. Whether the crisis develops next week, this year or within the next five years, it is bound to occur. When it does, government debt in the U.S. and world will limit effective policy to stimulate the economy. Similarly, trillions in quantitative easing and near-zero interest rates limit the ability of central banks to respond to a situations demanding action. The financial and economic crisis is likely to be worst than previous economic downturns.
In the kingdom, we always have hope. The Lord directed Moses to deliver the Israelites from the most powerful and prosperous country in the world. It took 10 plagues to accomplish it, but distinctions were made between the Egyptians and the Israelites. The Egyptians reaped the consequences of the plagues. The people of God were spared. The Israelites plundered the country when the Egyptians voluntarily gave them their gold and silver. The Lord destroyed the most powerful army in the world to protect His people.
Moses had impossible circumstances in the natural. Through the peoples' disobedience, he was to lead 3 million people and their livestock through the wilderness for 40 years. They needed divine guidance, protection and provision to survive.
The Lord did not disappoint. He provided an estimated 100 million gallons of water each week in the scorching heat of the desert. It would have taken more than 4,000 tons of manna each week and the Lord was faithful. Their shoes and clothing did not wear out. The pillar of cloud by day and the pillar of fire by night provided all the guidance needed.
We have no need to worry about the economy. Our God is faithful. But we cannot let our hearts become hardened through unbelief. We need to believe that all things are possible.
Specifically, we need to remember and believe:
1. All that the Lord has said and the testimony of others. "Afterward He appeared to the eleven as they sat at supper, and He reprimanded them for their unbelief and hardness of heart, because they did not believe those who had seen Him after He had risen" (Mark 16:14).
2. All that we have seen the Lord do. "Being aware of it, Jesus said to them, 'Why do you reason that you have no bread? Do you still not perceive or understand? Are your hearts still hardened?'" (Mark 8:17).
3. That the Lord is good and that He will cover our backs, even if there are no scriptural examples or personal experiences of the situation we are facing. "Then He went up to them in the boat and the wind ceased. They were greatly astonished in themselves beyond measure, and wondered. For they had not comprehended the miracle of the loaves, for their hearts were hardened" (Mark 6:51-52).
4. In the impossible. "Jesus said, 'If you can believe, all things are possible to him who believes'" (Mark 9:23).
Dr. James R. Russell is professor of economics and chair of the Undergraduate College of Business at Oral Roberts University in Tulsa, Oklahoma.
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