Applying Christian Principles to Modern Political and Social Problems

How can we solve the credit crisis?

This section is applied Christianity. It is the result of applying some of God's principles to the banking system and its regulation or lack thereof. It is also a further example of the wonderful principle proven by the journalist Clive James (on his Saturday Night Clive show) that for every problem mankind has, there are academics or business people who know the solution and then there are politicians who are too incompetent or self interested or corrupt to implement that solution. Clive showed that democracy does not work. It puts people in charge of areas of mankind's activity which they are not qualified to manage. President Bush for example.

The Black Hole caused by the Derivative Casino

The left wingers say that capitalism is failing or has failed because many banks and governments are essentially insolvent. But capitalism has 'succeeded' for 6,000 years. So it is not under test any more. Rather it is this generation that is under test. The most greedy and corrupt generation mankind has ever produced. The derivative markets are not 'markets' they are casinos. They are temple to greed. The writer knows this having played the wheat market since 2004 (betting biblically of course in accordance with his understanding of Revelation6, 1Kings18, Genesis41 etc). 

The banks have carried out a massive fraud on mankind. The GDP of the world is around 55 trillion dollars and the worldwide derivative debt to the casino was perhaps 1.5 Quadrillion dollars in 2009 and is now even more.

It would therefore take the whole world 30 years to pay off this debt if all the money every country makes went to the casino and we all starved and purchased nothing. This is not going to happen. Instead the casino will suck all the money out of the real production economy into its virtual gambling economy. The fix for this is to close down the casino and annul the debt. This is what president Hoover did in 1936 (having tried a freeze in 1931-1932) to prevent another great depression. But Ronald Reagan re-opened the casino in 1983. 

Here is how it works for a typical young banker with 10 million to invest. He has two choices...

[1]. Invest it in the real economy. Perhaps funding a car manufacturer in Birmingham. He might be able to get 7% interest on his money for 3 years - assuming the manufacturer does not go bust. So he would make 2,225,000 compounded over 3 years for the bank at best. And he might get a 22,000 bonus for that.

[2]. Put the money in the casino with 100:1 leverage and control 1 billion in the game. There is a good chance that he might make 100 million is 6 months. There is just as good a chance that he might loose 100 million in 6 months. If he makes 100 million in 6 months then he gets a 1,000,000 bonus in 6 months rather than the 22,000 bonus after 3 years. Which route would you take?

These young men and women are being bribed to destroy the economy of the world! The banks know this but do not care about the economy of the world. They just want to have a larger stake in the game. Because the larger your stake is the better the odds are for you. This game would actually destroy all banks except one if it were not for the fact that it will destroy all our economies before it reaches that point.

Putting this another way, if there are two banks playing each other in this casino then one will make a billion and the other will lose a billion. The one that loses a billion says: Oh no, rogue trader! And finds a way to suck the billion that it has lost out of the real production economy, from which we all eat. The bank that makes a billion should put that money back into the real economy. But they do not do that because there is no house limit in this casino. They put it back into the game and control another 100 billion in that game giving themselves better odds in the fight to the death for all banks that the casino has become.

Obviously the fix is to put a house limit in place that is at most the GDP of the world, not 30x the GDP of the world. But governments have not done that either because they are incompetent, or because they owe the banks so much money that they cannot afford to upset them - who knows? But we now have enough nuclear bombs to destroy the world many many times over and enough derivative debt to destroy the world many many times over as well.

The House that is built on sand 

The UK banking system over the last 25 years has become more and more property focussed. They have been given the power to throw women and children out of their homes and they have abused that power to invest massively in residential property and have neglected to invest in the economy in which that property is based. The fundamental flaw in western banking strategy over the last generation has been the misconception that residential property is secure, that it in itself is a security. It was believed to be secure because people really do not want their children to be thrown out of their homes. But in truth it is only as secure as the economy in which it is located. So if banks fail to lend effectively to businesses in the economies where their 'mortgage securities' are located, they actually have no security. 

To set the scene from a biblical standpoint please consider the following scripture...

6 No one should seize a hand mill or its upper grindstone as a pledge, because it is a soul that he is seizing as a pledge.
7 In case a man is found kidnapping a soul of his brothers of the sons of Israel, and he has dealt tyrannically with him and sold him, that kidnapper must also die. And you must clear away what is bad from your midst...

10 In case you lend your fellowman a loan of any sort, you must not enter into his house to take from him what he has pledged.
11 You should stand on the outside, and the man to whom you are making a loan should bring the pledge outside to you.
12 And if the man is in trouble, you must not go to bed with his pledge.
13 You should by all means return the pledge to him as soon as the sun sets, and he must go to bed in his garment, and he must bless you; and it will mean righteousness for you before Jehovah your God (Deuteronomy 24).

So of course you should not actually take his whole house as a pledge!! Neither could you take a soul as a pledge. And if you took anything essential such as an only garment or an only mattress, then since it was pledged, the debtor should certainly give it to you. But since you love your brother, you should certainly return it to him before the sun set. This was very proper behaviour. The law did not say that the debtor could just not bother to give the pledge back and just presume upon the kindness of the lender. No he must give what he pledged so long as it was not a soul or his means of living (such as his house and land necessary for feeding his family or the tools of his trade). But if the pledge was necessary for the basic existence of the debtor then the lender should return it before the sun set.

Anyone could choose to sell his house or his children or his wife or himself into slavery in Israel. But no one could be forced into that position by any creditor or any judge or any bailiff. Slavery was a family run social services network back then. And on every 7th year, all Hebrew slaves were to be set free unless for some reason they did not want to be set free in which case they became lifetime slaves. 

So the whole western banking system has become based upon usury. It is centred on the extortion that banks have the power to throw defaulter's families onto the street. Whereas the law of Moses provided that even a debtor's overcoat should be returned the day it was seized by the lender. Now Sir Isaac Newton discovered that action and reaction are equal and opposite in his Newtonian Dynamics. That is how the physical universe is created. We have all experienced this law with every physical collision in our lives. But the physical is a tutor to the spiritual. And as regards human interactions Newton's 3rd law becomes...

7 Do not be misled: God is not one to be mocked. For whatever a man is sowing, this he will also reap (Galatians 6)

The reaping and the sowing may be separated in time but the one will lead to the other in the end. So bankers who live off this usury will one day be thrown out of their homes and offices.

So really Deuteronomy24 and Galatians6 are the biblical principles behind the fix that we now propose. Although the writer also has extensive experience in both the property market and the derivatives markets which he uses to define the specific form of the fix.

Why do property crashes last 5 years?

The answer is simple. When property values start to fall, banks start repossessing at an accelerating rate. Northern Rock, the government owned bank in the UK, is now responsible for 25% of all UK repossessions. How sick that the public should be forced support a bank with that kind of morality! These repossessions have to be sold very cheaply at distressed sale values, which brings the property market down more. This begins a negative feedback loop in property prices, a vicious circle, where the lower the price goes the more repossessions occur and the more repossessions occur the lower the price goes. In fact banks repossess so aggressively that they produce a backlog of unsold repossessions. It is this backlog the extends the property crash for several years rather than the thing being over within a few months or quarters as it is with other commodity crashes.

The way to stop property crashes continuing is to effectively stop repossessions. Now one could just propose a moratorium on repossessions - Hillary Clinton proposed this in February 2008. She comes from a family that knows how to run an economy and pay off national debt. But that would scare the banks into total selfish mode so perhaps a better idea is to let them repossess but not let them remarket the repossessions until the market has recovered. We could then use the backlog of repossessions to moderate the upmarket and prevent the next property bubble. In the meantime the government would pay the interest on the repossession so that the bank loses no money, and the mortgagor would stay in the property with his family paying whatever he could to the government, as determined by a judge if necessary. This would be a kind of government housing association. This would stop the property market declining or at least slow it substantially. Then the law might say that families could not be thrown out of repossessed homes until 3 years after the recession ended. That would give each family a chance to get back upon their feet again. If the family was unable to get its act together after 3 years of non recession it is reasonable to assume that they never will and then they could be evicted. The buy to let repossessions could be marketed 6 months after the recession ended. In this way the length of the recession is minimized and the repossession sales rather than deepening the bust would moderate the next boom.

Now the banks are all in big trouble because they have purchased leveraged mortgage backed securities and have not imagined that these things could go down in value. The US property market is a $10 trillion market. Derivative leveraging can be anywhere from 10x to 50x. The main game has been the selling to each other of the next 25 years of mortgage interest payments. The trouble now is that in a lot of cases these payments will never exist. So do the maths and you see the magnitude of the problem. Worries about being able to meet the margin calls for these derivatives in a falling property market have led to the bank liquidity crisis.

When Paulson deliberately choose to permit Lehman brothers to fail, at that point, all banks thought - wait a minute, which bank can we trust? Which bank will Paulson abandon next? Hence they stopped lending to each other and the credit freeze began. In fact we should call this disaster the Paulson-Bernanke Depression since Paulson triggered it and Bernanke is throwing money at it in a way that we shall now prove cannot fix it.

Bernanke, Paulson, and Brown have proposed giving huge amounts of money to banks to solve their liquidity problems. This seems from a superficial evaluation to be a good idea but it is fundamentally flawed for the following reason.

The credit crunch is not the primary tumour here. The primary tumour is falling house prices and the leveraged effect that has on the future viability of banks. If we fix the secondary tumour of banking liquidity but fail to address the primary tumour of housing price collapse, the patient will still die. So we can be certain that injecting billions into banks but permitting the housing market to continue falling will not work.

On Sunday October15th, 2008, at the economic club of New York, a Harvard Economics professor asked Bernanke the following loaded question: Do you think that it is possible to avoid a depression and fix the credit crunch without enacting a policy which stops house prices falling?

Bernanke gave the classic power hungry status seeking bureaucratic response: Ha ha ha, yes I am aware of your theories and representations professor - ha ha ha ha. But I am more than satisfied that the measures which I, Ben Bernanke, the Fed Chairman, Yes the Chair-man of the Federal-Reserve, Ben Berrrrrrrnanke, have taken in setting up committees and spending billions and then setting up bigger more international committees and spending trillions and then planning in the future to set up even bigger more galactic committees inviting all the aliens from the delta quadrant and spending quadrillions will be sufficient to deal with this matter. And in any event the last time I looked at the door of the Fed Chairman's office the sign said: Bernanke, that is Ber-Nan-Ke - OK? So who is the the fed chairman professor? What is his name professor? (This is obviously a caricature of his response but has the substance of it).

It was the classic Clive James situation where the academic had the solution. A solution which had also been proposed by the Clintons and even attempted by McCain. But the bureaucrat was more interested in his own status than he was in solving the problem - which could not be more critical to mankind's prosperity or security.

Now it is relatively cheap for governments to pay the interest on all the repossessions in their respective economies. 100,000 repossessions in the UK would cost around 150 million per month and 500,000 repossessions in the US would cost around $750 million per month. These figures are tiny compared to the trillions now being wasted. The governments are trying to solve the problem in the secondary leveraged space, at the banking level, when they should be solving it in the primary non leveraged space, at the housing market level. 

The solution is this simple. STOP HOUSE PRICES FALLING. That is it. If you stop the rot, then banks know they have no further exposure and all the worry disappears. Now if taking all the repossessions off the market does slow down the price crash but does not stop it, then the government should remove from the market and pay the interest on the mortgages of all houses and flats that have been on the market for more than 6 months and put them in the housing association until the market recovers. And if that does not cause prices to start rising then they should do the same thing with houses and flats that have been on the market for 5 months etc etc. Until the market recovers which it will do when demand exceeds supply like any other market.

They must also ensure that there is a reasonable supply of residential mortgages at sensible income multiples whilst this goes on. They must understand that banks will not provide said supply because they are institutionally selfish and are incapable of acting in the common interest. So the government will have to fund a new bank with no bad debt to do this job in the short term. Let the banks watch their mortgage market disappear to this new bank in front of their eyes. That is the best way to kick their butts into lending again. 

Banks must understand that if they repossess in a property recession they will not be permitted to market their 'security' until the recession is over and neither will they be permitted to throw families out of homes in their usury. It is OK to repossess a second home or an investment property, but not a family home. That will moderate their absurd lending practices in the future. Ideally in the future no lender should have the power to evict families from their homes. This will force banks to lend on businesses rather than pushing house prices up to the level where a nice detached family home in London is 20x a doctor's salary in 2008 whereas it was 1x a doctor's salary in 1968. That really shows how banks have destroyed the moral values of our society. They are guilty of financial genocide in the hundreds of billions and the only sentence so far passed upon them is that they say sorry before a committee in Westminster for a couple of hours and get a somewhat smaller annual bonus. Whereas if a bank robber steals 10,000 from a bank he gets 5 years in jail. 

But we cannot blame only the banks. For they are the sheep and the government, the FSA, the treasury and the Bank of England, are the shepherd. This world, and its media, normally blame the sheep when they go astray and suck up to the shepherd. But the true villains of this piece are the governments and their regulators over these last 25 years and especially the over the last 10 years. They have permitted encouraged and profited from bank usury. All their mortgage market regulation has been a pointless charade. Banks may go bust, but governments and regulators are the ones who have really failed us.

More recently Gordon Brown has lead the way in betting a whole nation's economy on this rescue plan for banks which ignores the primary tumour of house prices. Is this not the height of irresponsibility? If house prices continue to fall then not only will banks go bust but whole countries which underwrite those banks will be following Iceland, the Northern Rock (literally) of national economies, under water.

The sad case of the 3 children incorrectly taken by social services

In the UK a couple had 3 children and one of them was found to have hairline fractures in his leg. Social services claimed that these could only have arisen from parental abuse and confiscated all 3 children and had them adopted by 3 other families whilst the court case into the abuse was delayed. 

By the time the case was heard all 3 children were irreversibly adopted. The parents were cleared of abuse, it was discovered that the child with the fractures had a genetic condition.

Social services then used the law to say that the adoptions were irreversible and so the children were now lost. The government position is, well no system is perfect we do the best we can, we are sorry we failed in this instance.

God's position is that the children are owned by the parents and were kidnapped by the government through their incompetent social services. What should happen now is that the court should give the parents the power to decide whether to retake their children or to leave them where they are or to operate a joint custody for a period until the children can either decide for themselves or until the children are comfortable enough to be returned to their parents. The adopting parents could then become 'uncle and auntie'. The point is that God gave the children to the parents not to the government. Even today these children are still kidnapped. 

4 But if any widow has children or grandchildren, let these learn first to practice godly devotion in their own household and to keep paying a due compensation to their parents and grandparents, for this is acceptable in God's sight (1Timothy 5).

To God wives are owned by husbands and children are owned by wives and husbands. So the social services have acted as a thief. Why were the children not given to relatives during the court case? Why were the parents assumed guilty until proven innocent? Even now the children are owned by the parents not the government. So the government is an unrepentant kidnapper of children. The penalty for kidnapping under the law of Moses was death. Just to give you an idea of how unjust and destructive to society the behaviour of social services is. 

More recently a Lords' Witness couple was acting as parents to a grand child from one of their daughters, since the child's mother had mental problems and the child's father had abandoned the mother. Social services suggested that the grand parents should apply to adopt the kid. They followed that suggestion and made the application. Then a new young and inexperienced social worker replaced the one that recommended the adoption. This new one abused the adoption process to make a false accusation of paedophilia against the grandfather. The grandfather then understandably felt like committing suicide. Fortunately he did not and various tests were performed on the children which found no evidence of paedophilia. But the social services did not return the child after the tests were negative. Instead they made a second false accusation of incest. This was of course easy to disprove. In December 2011, over a year after the court sanctioned kidnapping, the legal process is still ongoing. The children have not been returned. The judge who made the initial custody order promised that if the grandfather was found innocent of paedophilia the children would be returned immediately. He said that was his top priority. He was replaced by another judge at the next hearing who had other priorities. When the grandparents visit the child (which is a 4 hour round trip for them), the child repeatedly hits them. Presumably because she feels abandoned by them.

So what social services have done in this case is kidnap the child and hold it to ransom for the legal costs as regards society and for the emotional costs as regard the grand parents. The problem that the parents of government kidnapped children have is this. How much abuse from the social services and the family courts are they prepared to take in order to perhaps get their grand daughter back. God's answer is zero. The governments answer appears to be more than any family should bear. They have many times felt like saying: Just keep our grand child.

Public Sector Profiteering

In the UK, local councils and government departments are no longer satisfied with their guaranteed tax revenue stream. They all choose to compete unfairly with the private sector and abuse their positions to make charges for many of their services which have in theory already been paid for by our tax dollars. For example they charge for property searches, passport applications, drinks licences etc. etc.

In fact the view of the public sector has now become - well thanks for your tax money, that is in our back pocket. Now what can we do to make some more money? So instead of spending 100% of their time providing the services free of charge which your tax dollars have already paid for, they spend almost no time serving the public and instead sit around dreaming up new ways to take advantage of their market position as regulator or planning decision maker in the regions under their control in order to make more money for themselves. This is monopoly abuse, it is unfair competition, it is theft. They also set fine traps and pocket the fines which result from 'criminal' activities it their areas of jurisdiction. So the more criminality there is, the more money they make! 

The bible legislated against any profiteering by the public sector as follows...

24 For the tenth part of the sons of Israel, which they will contribute to Jehovah as a contribution, I have given to the Levites
as an inheritance. That is why I have said to them, 'In the midst of the sons of Israel they should not get possession of an
inheritance (Numbers 18).

The public sector in Israel consisted of the tribe of Levi. Levi was one 12th of the population. They got a tenth of the net produce of the country as a tax. They were not permitted themselves to have any inheritance (any land or property). So they could not carry out any business for themselves in what was an agrarian economy. This provision was to ensure that the public sector spend 100% of their time giving public services for free and 0% of their time trying to run some sort of a business.

The public sector was prohibited by law from doing any private sector type activity and therefore from making any addition revenue over and above their guaranteed tax revenue. In the UK this part of the law of God has been completely overlooked and the public sector spend most of the day it seems to the writer dreaming up new revenue earning schemes.

Take a drive around the London borough of Islington for example (a liberal democrat borough) and if your suspension is not ruined by the speed humps and if you can park outside any residential house or any business premises without getting a 120 fine then you will see that nearly every single property development is done in partnership with Islington council. In other words, Islington council has become the major property developer in the borough.

So why don't they become the major grocers as well and have all vegetables sold in partnership with Islington council? Or perhaps they could become the major hamburger supplier in the borough (for the good of the islingtonians of course you understand since the government is so much more trustworthy than a hard working businessman) and then all hamburgers could be sold in partnership with Islington council too!

This is public sector corruption and a violation of the principles behind the law of Moses. If you are a public sector outfit you should not indulge in any private sector activity.

So this simple one verse principle of the law of Moses, if applied, would wipe out a lot of public sector corruption in the UK. 

Every Football Team Manager needs to know how to play football

Every reader will know that every manager of every premier league football club knows how to play football. Most of them have actually been professional football players. We all know that is Chelsea or Manchester United hired a manager who could not play football, they would drop straight out of the premier league. So that would never happen.

Why can we not apply that principle to the public sector? The UK National Health Service has 700,000 Doctors and Nurses working for it. These people are managed by 750,000 NHS bureaucrats, the vast majority of whom have never been trained either as doctors or nurses and therefore cannot cure the sick. This is a diabolical corruption that has directly lead to the 10,000 unnecessary deaths each year in the health service, mainly from MRSA and C. Difficile. But don't worry too much about all the deaths because the pensions of the bureaucrats are safe and that is what matters right? 

The UK now has an NHS which is several hundred times more lethal than the Taleban to our citizens. It is not just that the managers do not know how to cure the sick. It is that instead of having 50 men managed by 5 men as was the case under the law of Moses, or instead of having 50 men managed by 20 men as was the case at the height of Eastern European Communism, we now have 50 men managed by 55 bureaucrats, which is extreme communism. It is extreme corrupt communism.

The bible teaches that the one with the most experience should be the leader not the one with absolutely no experience or training! That is why congregations are to be run by elders, not by youngers, or worse still by people outside the church! The NHS administration philosophy would have the faithless managing the faithful! 

The reality in the health service is that doctors with 20 years of training behind them are prohibited by the Department of Health from making a decision without consulting a school leaver who has a government manufactured job as a health service manager. This is why we lose 10,000 patients a year to preventable causes in the UK. All the decisions are therefore made by people who do not have the medical training that the tax payer has funded. It is lunacy in action.

32 And [gifts of] the spirit of the prophets are to be controlled by the prophets.
33 For God is [a God], not of disorder, but of peace. As in all the congregations of the holy ones (1 Corinthians14)

The NHS has the gifts of curing the sick controlled by people who would not know a pyloric sphincter from a hole in the backside.

The writer's father was the professor surgery at what is now the Royal London NHS Trust Hospital or something more grandiose perhaps. When he first became a professor at that hospital there was one administrator. The bursar - whom the writer met on several occasions! The whole place was run by the doctors and the nurses in those days. There were no waiting lists. The nurses were not ludicrously overworked. Now that hospital most likely has more bureaucrats running it than it has doctors and nurses working in it. 

Education in Finland

Finland presently has the best education results in the EU, according to a documentary screened in April 2010. Yet its children do less hours in school than most other countries. How does it achieve this? Well according to a Finish headmaster in this documentary: "The Government trusts us". They do not interfere. The elders are permitted to run the church. People trained to be teachers are making the decisions about education - not politicians who have no training as teachers. The more the government interferes, the worse the education becomes. Because the government is absolutely the worst headmaster in any country.

Racism and the Football Association

In late 2011 the Liverpool football player Suarez was accused of racially abusing Evra, a French and black Manchester united player. The case was one man's word against another's as far as the writer is aware. Furthermore Evra has a history of making false claims of racism against competing footballers. In 2006 the police investigated one such complaint and found it to be false. In any event the football association found Suarez to be guilty of 'racism' in much the same way that Americans in the McCarthy era used to find their countrymen guilty of 'communism'. Governments love to police people's thoughts. Now the law of Moses sets the most brutal punishment for crimes of conflict. The penalties under that law were unarguably just, but devoid of all mercy. Moses prescribed eye for eye, tooth for tooth, blow for blow, branding for branding, soul for soul, and insult for insult. However the plaintiff could show mercy and accept a ransom for his lost body part if he desired. The law of Moses empowered the plaintiff, not the government.

So under the law of God, Evra should have been given the opportunity to insult Suarez in the manner that Suarez insulted him, no more and no less. But instead the FA fined Suarez 40,000 and banned him for 8 matches. To the extent that this penalty exceeded a comparable insult, it was unjust. Such a huge injustice must carry with it the accusation that the FA gave the penalty on pro black racist grounds or anti hispanic racist grounds (Suarez is from Uruguay).

Ironically the writer's experience of law enforcement in the UK is that you can be as derogatory as you like to the French (so long as the Frenchman is not black) and they can be as derogatory as they like to the English (so long as the Englishman is not black). For example the English call a condom a French letter (and vice versa). That is plainly a racist insult. But it has gone unpunished since racism became a crime. Incidentally the bible does not legislate against racism directly but does legislate that we should all behave as if we are in the same family. Well brothers do insult each other from time to time! 11 of the 12 apostles were from the North of Israel and all 12 were Jews. The 12 apostles were not hired by positive discrimination or enforced racial diversity.

Finally, the law of God only permits a conviction if there were two witnesses. The FA say Suarez was unreliable and Evra was credible. The law of Moses re-iterated by Jesus was not to admit an accusation save on the evidence of two witnesses. 

16 But if he does not listen, take along with you one or two more, in order that at the mouth of 2 or 3 witnesses every matter may be established (Matthew 18)

In fact the UK police will not prosecute in most conflict cases where there are no independent witnesses. There was no independent witness in Suarez vs Evra. So the FA should not even have considered the case. 

If FIFA and the FA were to be abolished then we would be half way to the Kingdom of God from a footballing standpoint (is the opinion of the writer)