Christianity and Banking VI.


You shall not steal (Ex.20:15).

You shall not covet… (Ex.20:17).

These commandments prohibiting theft and covetousness makes it abundantly clear: the Bible is the document of free-market capitalism, NOT government intervention.

“Behold, the days are coming,” declares the Lord, “when I will raise up  for David a righteous Branch; and He will reign as king and act wisely and do justice and righteousness in the land” (Jer.23:5).

A Christian concern for justice and righteousness within the banking system is an aspect of the furtherance of the kingdom of God; the Lordship of Jesus Christ. Christians must see this as both legitimate and necessary. “Justice and righteousness in the land,” is not some nebulous, abstract concept; it clearly involves finance and banking.

How do we know this? Because the Bible tells us that “a just balance and scales belong to the Lord; all the weights of the bag are His concern” (Prov.16:11). The Bible has much to say about gold and silver, and about borrowing, lending and interest rates, all of which are aspects of a free-market economy. For Christians to think they have no need to consider the legitimacy of banking practices indicates that there are aspects of life not subject to the law of God and the Lordship of Christ. But “all the weights of the bag…,” means just that.

A. Banks and Government:

1. The control of banking by government is a hang-over from Marxism. Marx wanted total control of banking by government; a central bank. Ask anyone today do they believe in Marxism, and they would probably say “of course not.” Little do we know just how much we are still affected by Marxist dogma in the west, in Education, Health, Welfare and Banking.

People sometimes say, “its nice to have friends in high places.” Indeed it is. But if having friends in high places means that an individual or group has an unwarranted influence, this can lead to overt or covert corruption. God’s law is the only guarantee for justice within any community, and legislators must ensure that they are subject to the law of God.

It is always potentially dangerous when a certain group or industry in a community is consistently very close to those who make legislation; they may develop an unwholesome level of influence, to the detriment of justice. This can be any group: a particular religious denomination, or unionists or environmentalists, or the poor, or a group of employers, or doctors; any influential group in the community. Many groups hope that they can extract a special deal from the government in their favour, but this invariably means the supplanting of righteousness.

Historically, banks have tended to seek some form of special relationship with governments. The more corrupt the government, the more likely that some form of “special relationship” will eventuate. Corrupt governments convince themselves that this will be beneficial for them, and they ignore the fact that justice is then deprived from the community.

“Special relationships” between banks and governments can be overtly or covertly constructed. Banks like a semblance of formality wherever possible: it gives them the protection of legality, and thus security. Thus they generally seek some kind of formal structure that grants this relationship a measure of both legality and legitimacy in the community.

Almost every nation in the world has some form of Reserve Bank. They represent a “special relationship” between government with banks. They frequently permit banks to benefit from national economic manipulation, but with legality, and thus legitimacy. Thus a subtle (or not so subtle) form of corruption and nepotism develops. In the United States,

the Federal Reserve system virtually controls the nation’s monetary system, yet it is accountable to no one. It has no budget, it is subject to no audit, and no Congressional committee knows of, or can truly supervise its operations. Murray Rothbard.

The Chairman of the Federal Reserve is appointed by the U.S. President, so the Chairman knows who will be renewing his contract in the future. Would he really want to make a decision displeasing his boss, who also seeks  re-election? The Chairman is an unelected banker/bureaucrat, but he has more economic power than the President, and his decisions have great impact not just on his nation, but on others as well.

The United States claims to be the “land of the free and home of the brave,” but the reality is far different. Its banking system has not been free, since the nation’s biggest bankers conspired with politicians to structure the Federal Reserve in 1913, which someone called “The Hideous Creature from Jekyll Island.”[1] The bankers effectively said to the nation’s political leaders, “we’ll look after you, if you’ll look after us.”

This is effectively a fascist system, where banks and government collude to get the results that suit them both, to the detriment of justice and the community. Thus (as others have suggested), the bankers on Wall St can be pocketing vast bonuses, while Main St U.S.A. is going bust.

Since 1913, the U.S. Federal Reserve has inflated the U.S. money supply so much, that the dollar has lost 96% of its value. An item costing 4c in 1913, now (in 2011) is worth $1.00.

How does this happen? Reserve banks are able to manipulate the money supply, by printing money. What individuals cannot legally do without being charged with counterfeiting, Reserve Banks do constantly. A loose monetary policy with low interest rates means there is plenty of money around in the economy to be lent and spent. This generally creates demand and therefore jobs, and pushes up prices. This is “helping the economy,” if you are a banker, but leads to the “boom-bust” scenario which the western world has known now for a hundred years.

How does this happen? When inflation is getting “too high,” even for bankers, the Fed will tighten monetary policy by raising interest rates. Borrowers say, “I won’t borrow at those rates.” Business demand drops off, prices fall, and unemployment rises.

Inflation is commonly seen as an increase in the prices of commodities, but this is really a result of inflation. A true definition of inflation is an increase in the money supply. “There is one cause, and only one cause, of depressions: prior inflations.”[2] The elite manipulate, and call it “good policy.”

It is significant that in the period from the Napoleonic wars to the First World War, when the gold-standard was used internationally, prices remained substantially the same. Yes, governments printed money as a form of currency, but only in relation to the amount of gold they possessed. With the coming of the First Word War, governments threw caution and sound money policies out the window in the haste to get, spend and borrow money. As Ron Paul explained,

It is no coincidence that the century of total war coincided with the century of central banking. When governments had to fund their own wars without a paper money machine to rely upon, they economized on resources. They found diplomatic solutions to prevent war, and after they started a war they ended it as soon as possible. [3]

The final connection between the U.S. dollar and gold, was dissolved in 1971, by President Nixon. From then on, it has had no backing of any kind. It floats on a sea of nothingness.

What about the gold in Fort Knox? How do we know how much there is, or even if there is any there at all? There has not been an audit of the gold there since 1953, and that was only a partial one. The Federal Reserve has consistently resisted an audit, which tells anyone: does the Fed have something to hide? Funny things sometimes happen to extremely valuable[4] and easily transportable commodities when no one is looking.

When men reject God, they must choose something (or somebody) in His place. As North explains,

Ethically rebellious men refuse to live under the dominion of randomness. Yet they also refuse to live with the idea of a sovereign personal God. Therefore, they have adopted the only intellectual alternative: dominion by elite planners... Most men want to live in a universe with meaning and purpose, but this requires the concept of predestination… it is never a question of predestination or no predestination. It is always a question of whose predestination.[5]

[1] The U.S. Federal Reserve was set up as a result of a secret meeting between bankers and politicians at Jekyll Island off New York, just before Christmas in 1910.

[2] North, G., “Honest Money,” 1986, p.85.

[3] Paul, R., “End the Fed,” 2008, p.63.

[4] Gold is worth A$49,000/kg in February, 2011.

[5] North, G., “The Dominion Covenant,” 1987, p.22, 23.

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