Iyar/Sivan  5774    May 2014



Two Jewish holidays – Yom HaAtzmaut (Israel Independence Day) and Yom Yerushalayim (Jerusalem Day) – occur in May. They’re not Biblical holidays but their significance should not be discounted. Every child of God should rejoice that in these Last Days, many of the Jewish people have been regathered to our ancient land and the state of Israel has been reborn! Likewise every follower of the King Messiah should yearn for the peace of Jerusalem (see Psalm 122:6). Nevertheless, over the past 10 years there has been a shift away from support of Israel among some Christians. At the same time, there has been a shift away from recognizing the authority of the Bible among some Christians. In our opinion, the two go hand in hand. Increasing disregard for Scripture and what it states about Israel in the Last Days, and the growing worldwide hostility toward Israel, fulfilling the words of the prophets and apostles, should come as no surprise. But we are grateful that this doesn’t describe Shema’s friends and supporters. Thank you for remaining steadfast to the Word of God and the well-being of the state of Israel, and being supportive of bringing the life-saving Message about the Messiah to the Jewish people and the peoples of the nations. May the Three-In-One God of Israel bless you in a special way!



It was said of the sons of Issachar, that they were men who understood the times, with knowledge of what Israel should do. I think I understand our times and what we should do.
Blessed is the nation whose God is the Lord

The United States had a good beginning. The first European settlers had a Biblical world view. Protestant Christianity was the dominant religion. Religion, morals, virtues, good character, personal responsibility, hard work and saving were emphasized.

The United States had a good beginning, but it wasn’t perfect. It was marred by our national sins of slavery and taking advantage of the native population.

After the War of Independence, the framers of the Constitution created a limited government. The money was gold and silver. Agriculture, natural resources and simple manufacturing formed the backbone of the economy.

For the next 150 years, the nation expanded geographically and economically. From time to time spiritual renewals occurred.

In 1913, the Federal Reserve was created. It is neither federal, nor is it a reserve, since it is close to being bankrupt. It is owned by the banks and exists primarily for the benefit of the banks, not the general population.

After World War Two, the United States became the world’s sole superpower. The nation was strong and prosperous. We had the strongest military. We had the atomic bomb. We had the only undamaged economy. Our manufacturing was preeminent. Our agriculture was flourishing. Technology was advancing. There were lots of good-paying jobs. The average man who worked could support a family and buy a house and a car. The dollar was considered to be as good as gold and replaced gold as the world’s reserve currency. Detroit of the 1950s was one of the wealthiest cities in the world and a symbol of our national prosperity.

The wicked will return to Sheol, even all the nations who forget God
When it goes well with the righteous, the city rejoices. Righteousness exalts a nation. God, true religion and Biblical morality can’t be separated from freedom and prosperity. Things began changing for the worse in the 1960s. The multiplying secularists began eliminating religion from our public institutions. We got involved in the Vietnam War, which was costly in blood, treasure and national unity. At the same time, the Great Society was instituted, adding more major government spending programs to the budget. This combination of “guns and butter” caused the nation to begin running chronic deficits.

In 1971, Nixon stopped allowing other nations to exchange their dollars for gold. The dollar became completely detached from any gold backing, which allowed the government to create more unbacked dollars and run bigger deficits. By the end of the 1970s, gold went from $35 an ounce to $800 an ounce. Inflation, which is primarily caused by printing money not backed by gold, increased dramatically.

During the ‘60s, ‘70s and ‘80s, the economies of the other nations were recovering from the devastation of World War Two. Technological innovations and global trade increased. Starting in the ‘70s, US manufacturers began building factories in other nations where the cost of labor was cheaper. Millions of manufacturing jobs, which pay more and create more wealth, were exported. More service jobs, which pay less, were created. Over the past decades we have gone from an agriculture/manufacturing-based economy to a service/financial economy to a highly indebted, financial/ponzi-scheme economy. We have gone from a strong, healthy economy to a weak, unhealthy, distorted economy.

The government has grown immensely. It has become pervasive and expensive. It is interfering in almost every area of our life, and it is interfering in the economy. We have gone from free-market capitalism to crony capitalism – a corrupted capitalism in which big money and government collude. The big money buys the politicians, who then legislate for the benefit of the banks and corporations. Big media cooperates with big money and big government. Over the past 30 years, the financial system has been skewed to favor the wealthy. For example, the bailouts in response to the 2008 financial crisis enriched Wall Street, not Main Street. Around 1980, the salary of the average CEO of a large corporation was 40 times the salary of the lowest-paid worker. Now, it’s closer to 350 times the salary of the lowest-paid worker.

The government has interfered in the economy and prevented true capitalism from taking place. It has prevented bankruptcies and recessions from taking place – which are necessary to cleanse the economy from bad investments. It’s like fire fighters who prevent small fires from taking place in a forest, allowing the buildup of dead brush and wood, so that under the right conditions, a massive fire occurs that destroys everything.

Our national debt is $17.5 trillion, more than 100 percent of our GDP. Besides that debt, we have another $200 trillion in social promises. Most nations that far in debt never climb out of that hole. What they tend to do is print money to pay off the debt, which is a kind of theft. It steals the buying power from those who hold their currencies and bonds. Once a government begins printing money to pay its debt, it enters a downward spiral that is almost impossible to pull out of. We are far along that highly indebted money-printing path. We will never pay off our debt with dollars that are worth what they are today.

The other nations know that the United States has been printing dollars to live beyond our means and sustain our military. They understand that the dollars and bonds they hold as the reserve currency are being debased and their buying power is being diminished. China, Russia, India, Brazil and others have been working to replace the dollar as the world’s reserve currency, since they don’t want their dollar holdings used to prop up what they consider to be a profligate, imperialist nation. If the dollar is replaced as the reserve currency, dollars will not be accepted by as many nations and the price of things we import (think oil) will go up dramatically. That can devastate our economy.

Government statistics can no longer be trusted. The real unemployment rate is close to 23 percent, not 6.5 percent. The real inflation rate is close to 9 percent, not 2 percent. Prices for the basics are rising significantly: food, gas, electricity, housing, education, insurance. Fifty million Americans are on food stamps. The middle class, which is essential to a healthy democracy, is getting destroyed. It now takes both a man and a woman to make ends meet – which adds extra stress on the family.

In response to the 2008 crisis, the governments of the world lowered interest rates and printed trillions of dollars, euros, yen and yuan to prop up banks and corporations. While the stock market has gone up, and the price of houses has gone up, and bonds have gone up, we are not in a real recovery. It’s an artificial recovery induced by money printing and suppressed interest rates, which helps zombie banks and corporations survive and speculators to continue speculating. However, that artificial stimulus has worn off and the world economy is heading down again – more in debt than ever, highly leveraged and with more unbacked money than ever. The economy is like a junkie who needs more and more stimulants just to maintain, but gets progressively sicker. As the acceleration downward intensifies, governments will need to print trillions more dollars, yen, yuan and euros (think hyper-inflation) or let the economy collapse into a deflationary depression.

The Chinese economy created a colossal credit bubble that may have started collapsing. Japan is hugely in debt and will never pay off its debt. The nations of the European Union are hugely in debt. The world economy is heavily indebted, highly leveraged, distorted, fragile, brittle and interconnected. Since it is interconnected, a problem in one nation can set off a chain reaction everywhere.

Overhanging everything, like the sword of Damocles, are more than a quadrillion dollars (a thousand trillions!) of derivatives, which are financial insurance contracts. Many of these derivatives are not backed by anything, so a failure with a key institution or bank, or a government default, can set off a financial chain reaction that destroys the world economy.

We have a highly complex, interconnected system that is prone to collapse. It is vulnerable to a sudden economic shock from a cyber-attack; a spike in the price of oil or interest rates; a terrorist attack using a nuclear bomb, a dirty bomb or a chemical or biological weapon, or an attack against the electric grid; a war; a decision by the alliance of BRICS nations to replace the dollar as the world’s reserve currency; or simply a general loss of confidence. The world economy is a series of bubbles in search of a pin, a house of cards getting ready to collapse.

There is no way to grow ourselves out of this economic black hole. We are past the point of no return. More debt creation and artificial stimulus will not generate a sustainable recovery. We have been living beyond our means for decades. We are living on borrowed money and borrowed time.

Since the 1960s, along with our financial decay, we have been experiencing political, social, religious and moral decline. An explosion of divorce, suicides, senseless acts of violence and sexual promiscuity has taken place. Fifty-five million babies have been killed in their mothers’ wombs. The culture is not only post-Christian, it is aggressively anti-Christian. Most of its thought leaders, cultural leaders and political leaders are hostile to God, God’s values, God’s people and God’s institutions.

You have been weighed on the scales and found deficient

We are like the Babylonian nobles who partied and mocked the God of Israel while the army of the Medes and Persians was besieging the city, diverting the river that flowed through the city. The invaders used the river bed to walk under the walls, conquer Babylon and end the Babylonian empire. We are at the end of an era. Things are about to radically change. Since the 1960s we have sown the wind, and I expect, at any time, but within the next year or two, to reap the whirlwind of financial disaster, and possible social and political chaos. In a novel by Ernest Hemingway, a character asked: “How did you go bankrupt?” The response: “Two ways. Gradually, then suddenly.” We have been going bankrupt gradually, and I expect that soon we will go bankrupt suddenly.
The prudent see danger and take refuge, 
but the simple keep going and pay the penalty

Be aware of “normalcy bias” – the tendency to think that tomorrow will be like today, with only small variations of change. “Come,” they say, “let us get wine, and let us drink heavily of strong drink; and tomorrow will be like today, only more so.” Having a Biblical perspective enables us to understand that bubbles in stocks, bonds, real estate, currencies, economies and even governments can collapse quickly. Think of the sudden collapse of the Babylonian Empire. A year before the Soviet Union collapsed, almost no one could imagine that it would fail a year later. We need to be careful about taking on long-term projects or financial obligations, assuming that present conditions will continue into the future.

We should be prepared. We don’t want to panic when the world does. We should be calm in the storm. Have a month’s worth of food. Have some cash on hand. Use the banking system only for current and basic financial needs. Banks and ATMs may be shut down for an extended period. Bank deposits may be taken (“bail-ins”). IRAs and 401Ks may be replaced with worthless government bonds. The dollar may very rapidly lose its value. Store the majority of your excess wealth in the best kind of money – gold and silver. It’s my opinion that silver is the best investment on the planet. Don’t go into debt. I used to think that if the currency is being inflated, it’s good to borrow money and buy something like a house, and pay the house off with increasingly worthless dollars. Banks are aware of this, and in a hyper-inflationary collapse, they use their influence with government to rewrite contracts so that debts are paid off in the new currency.

Balancing Our Perspective: Blessed Are The Poor

I know this sounds dreadful. We need to balance this bad news by giving people a Biblical perspective on trials. God can use suffering and poverty to redirect an individual or a nation back to Himself and the Good News. In fact, the Gospel tends to thrive under duress. As people lose faith in this world, they become more receptive to God and His world. And Messiah’s Community can be purified, unite and grow – and that would be a tremendous blessing!


Rabbi Loren