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September 29, 2008 | 4:44 pm

Economy keeps tumbling; what hath God wrought?

Posted by Brad A. Greenberg

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As I tweeted earlier today, the world appears to be coming to end (at least the world as we know it). The House backed out of the bailout; the Dow responded by plummeting ... 777 points—in this case a very unholy number; and Apple stock, which I should have sold at $198 a share tanked 18 percent and Google sank 12 percent.

And yet, today wasn’t even close to as bad as officials close to Treasury Secretary Henry Paulson feared it might be. Or is that day of reckoning still to come?

Let’s hope not. The most frustrating part about this whole mess for most of us is that we are innocent of the avarice that led to this calamitous situation. (I could go on to this point ad nauseam, but instead I’ll just avoid it altogether ...)

In light of what’s happening in our financial market and sending tsunamis into the U.S. economy, the Rev. Al Mohler, president of Southern Baptist Theological Seminary, reflects on a Christian’s moral responsibility during a time of irrational exuberance:

Christians should look at the economy as a test of our values. The Bible values honest labor and dedicated workers, and so should we. The Bible warns against dishonest business practices, and we must be watchful. False valuations are, in effect, lies. Dishonest accounting practices are just sophisticated forms of lying. Insider information is a form of theft.

The Bible honors investment and thrift, and Christians must be wary of the impulse for short-term gains and pressure for instant profit. Over the long-haul, the entire economy must prosper if the vast majority are to do well and realize a responsible gain.

Thus, the current crisis sheds light on what happens when things get out of control, when various pressures distort the proper operation of the markets, and when irrational valuations entice investors to make poor investments. Dishonesty enters the picture at many levels, and the individual investor is too often left in the dark.

When these things happen the economy is threatened by a lack of trust, and trust is the most essential commodity of all when it comes to economic transactions. Without trust, the entire system collapses.

The big debate in Washington is over the extent of government intervention. Prudence would indicate that the less government intervention, the better. Adam Smith was confident that a “hidden hand” within the economy would rectify excesses and punish bad actors. I think he is basically right, but the government is, like it or not, one of the actors in this economic system.

The problem with letting the markets solve this problem and letting the “hidden hand” punish the bad actors and unwise decisions is that, in this situation, the small investor is crushed along with the tycoon. Furthermore, the entire economy could face a crisis of confidence.

I left that last part in there because, on this, George Bush and I agree. I’m not a fan of socialism for the rich—thanks for that, Rhett—but I’ve never cut off my nose to spite my face. Read the rest of Mohler’s article here.

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much like you brad, I am a twenty-something paying the bill for someone else’s sins.  i find myself against the bail-out and almost wishing for the collapse of our current financial system.  a metaphorical ‘reset’ button for our countries finance.  i realize that this will hurt a lot of people…many people will say that my ‘nerf’ life here in orange county is immune to it and i am not thinking of the little people, the poor.

But that would be short sighted.  I made a bad investment 2 years ago, when I purchased a condo that had a highly inflated price.  Now I can afford my home and my mortgage, but I will be the one responsible for my poor decision, and I am okay with that.

Moreover, my parents currently live under the poverty line due to the fact my father lost his entire savings in a stock that froze and was declared worthless due to ‘cooked’ books.  my aunt and uncle suffered the same fate as my uncle was middle management in Enron and had his retirement disappear one day.  I say this because they are living testaments to the fact that life does not end when our money disappears.  Life changes a great deal, and it is not easy; but it is hardly doomsday.  I believe in a sovereign God who I can have trust in, not for money or property, but for peace in my life.

Let wall street crumble.  Wouldn’t that be better than having our taxes artificially pump up our economy, just so I could feel like my bad investment was a good one?  If we bail-out now, won’t we bail-out again in the future?  Will we just be handing an even bigger mess on to our children or maybe right when I am trying to retire?  I would rather deal with the pains now.

Comment by ethan on 9/29/08 at 6:55 pm

I like that ‘Economy keeps tumbling; what hath God wrought?’ Somehow God gets credit for the bad stuff, but (Deut. 8)
11 Beware lest thou forget the LORD thy God, in not keeping His commandments, and His ordinances, and His statutes, which I command thee this day;
12 lest when thou hast eaten and art satisfied, and hast built goodly houses, and dwelt therein;
13 and when thy herds and thy flocks multiply, and thy silver and thy gold is multiplied, and all that thou hast is multiplied;
14 then thy heart be lifted up, and thou forget the LORD thy God, who brought thee forth out of the land of Egypt, out of the house of bondage;
* * *
17 and thou say in thy heart: ‘My power and the might of my hand hath gotten me this wealth.’
18 But thou shalt remember the LORD thy God, for it is He that giveth thee power to get wealth, that He may establish His covenant which He swore unto thy fathers, as it is this day.
19 And it shall be, if thou shalt forget the LORD thy God, and walk after other gods, and serve them, and worship them, I forewarn you this day that ye shall surely perish.

Notice it does not say that God will destroy us, just that we will perish. Oppose God and he will oppose us; forget God and he will forget us, remember God and he will remember us.

Mohler’s next-to-closing lines make sense:
“Today’s crisis in the financial system should not be a threat to the long-term health and vitality of our economic system. There is cause for concern, but no justification for panic.”

I believe all this hurry-up-gimme-a-trillion-this-week-or-else is just someone trying to pull a fast one. Nobody is dead yet. Maybe just a nice little freeze on non- life or death transactions until we all calm down, a little categorizing of the risk levels, a little prioritizing, and I bet the worst could be handled with twenty billion loan guarantees, no more. They are trying to handle this the way Jimmuh Cahtuh handled the Cuban refugees. He said send us your tired, your poor, etc., and Castro emptied his jails and lunatic asylums and sent them all over. Similarly, We the Suckers are supposed to sink under all the crap that the haircut and shoeshine set can unload on us while they dance off with the profitable stuff. Forget it, I say.

If this financial system was a computer system, nobody would use it. Any investigation would not focus on the bad loans, but on the supposed safeguards the system should have against those kinds of things and who were the guardians.

Comment by Ben Plonie on 10/02/08 at 12:45 am

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