Wisdom With Wealth News

What is the most common financial mistake that Christians make? Answer: Following popular advice while ignoring biblical principles. Biblical principles are amazing. They work. Always. Let’s look at five.

Since the 2008 stock market downturn, major countries around the globe have been avoiding fiscal restraint and engaging in currency wars. Essentially, they have been trying to outdo one another in printing money to generate wealth, but really, it’s the illusion of wealth. I like the way Drummond Brodeur, Senior VP and Global Strategist of CI Investments, put it: “Without tough reforms in both the Eurozone and Japan, Quantitative Easing is just a palliative monetary drug that eases the pain of decline, but does not fix the problem.” Multiple central banks now have negative interest rates. I don’t know how this coping method will end, but it won’t end well. I believe we are slowly and steadily moving towards a global currency made up of a basket of the world’s major currencies plus a portion of gold. Canada has zero gold reserves, thereby making it weaker in a global currency crisis. The use of gold makes me think of the “shekel of the sanctuary” described in Leviticus 27:25 NIV: “Every value is to be set according to the sanctuary shekel, twenty gerahs (approx. 12 grams) to the shekel.”

Work is a four-letter word. I’ve never liked it. The only things I seem to like are immoral, illegal, or fattening, but their pay is lousy. Good pay takes real effort. A Calgary saint, now-in-glory, by the name of Henry Esau used to attend Crossroads Community Church. During downturn of the mid 80s he said many people were looking for a job, but not many were looking for work. Jobs with no work? Sign me up. Yet, I also remember my dad saying that during WW2, in the prisoner-of-war camps, he saw men going crazy from boredom. They said to their captors, “Give us some work to do.” Why is this four-letter word so unpopular and yet so necessary? We hate it, and love it at the same time!

What do you add to your coffee? And I don’t mean cream or sugar.

Although not a coffee connoisseur, I do enjoy a cup of good coffee. Have you noticed that when you buy coffee, and many other consumer items, they often come with “extras?” By this I mean customer loyalty promotions. At McDonald’s you get one sticker for every hot drink, and when you have collected seven you get one free drink. At Tim Horton’s you get to play Rollup the Rim for a chance to win. So what? I know the different tactics seem insignificant, but the underlying principles are highly important. These two loyalty promos reflect radically different strategies for improving your financial well-being. One strategy fosters an attitude of steady plodding, and the other a spirit of speculation. One works for gain and the other plays for gain. Which is better? McDonald’s has the better plan based on Proverbs 13:11: “Wealth gained hastily will dwindle, but whoever gathers little by little will increase it.” (ESV)

Hard times in Alberta call for a financial refocus back to the Bible. Some Bible passages I find difficult to understand. For example, when God led the children of Israel out of Egypt, it soon became apparent that the desert vegetation and wildlife could not sustain them. God supplied manna, the sweet cookie-like food, six days a week. Obviously, this was miraculous. We find the full account in Exodus 16. There was enough for over two million people. The manna that came on the sixth day lasted for two days, while all other days’ manna spoiled in one day. Personal effort was required to collect this miracle food; it did not just crystallize in their baskets.

Recently, I took a two-day refresher course in Calgary on Personal Income Tax. Two full days of painful, technical details, but the lunches were good. Quoting from the teaching professional, our taxes, and especially the sequencing of tax credits, is “insanely difficult.” Did you know that from 2015 to 2016 the top marginal rate in Alberta rose from 39% to 48%? The number of tax brackets increased from five to nine. The future looks even worse. As governments continue overspending to “stimulate” the economy, they push the financial burden onto our children and grandchildren. We are to blame. Where did this love of taxation come from?

Are we being fooled about money? In this short article, Tom talks about the three biggest money myths we are often led to believe, and why it’s dangerous to believe them.

1. You must have a lot of money to be a good money manager: FALSE.

How did the great money managers develop their skills? They all started small. Skill and amount differs like a pianist and a piano. Some say, “Just let me win the lottery and I’ll show you how good I am at managing money.” Dream on. Jesus said, “He who is faithful with little is also faithful with much,” (Luke 16:10). The skill of money management is more important and valuable than the money itself. God says in Proverbs 8:11, “Wisdom is better than jewels and all that you desire cannot compare with her.” Let me go on to say that good money skills usually attracts more money, but not always. The key is to focus on skill development, not on quantity.

Recently, I read an article in the Financial Post saying that some States in America (15 to be specific) are aggressively looking at establishing their own local currencies based on a gold standard. The Colorado Honest Money Act, the Vermont Dollars bill, and the Georgia Constitutional Tender Act among others exemplify the deep frustration with the massive printing of U.S. dollars during the past four years. Quoting from the Post: “Once the domain of crackpots and wingnuts, a growing number of Americans believe returning to the gold standard or bringing gold coins back into circulation, is the only way to restore sanity to the fiscal system that is out of control.” In Utah, a law went into effect in May making gold and silver coins legal tender and exempting the exchange of coins from income or sales tax liability.” Imagine that, the establishment of new local currencies. It makes me remember the Master’s words: “A kingdom divided against itself cannot stand,” Mark 3:24.

Something for nothing. We all want it, but where can we get it? Is it even realistic? Recently I read a quote from Mark Mobius, Executive Chairman of the Templeton Asset Management’s Emerging Markets Group, that another financial crisis is inevitable because causes of the previous one haven’t been resolved.

Mobius was addressing the Foreign Correspondent’s club of Japan in Tokyo in response to a question about price swings: “Are derivatives regulated? No. Are you still getting growth in derivatives? Yes.”

Recently the value of gold hit an all-time high of $1,556.33 US per ounce. That’s an increase of over 400% since I last wrote about precious metals (City Light News October 2003) when gold was $370. Why the huge jump?

In a nutshell, the financial confidence in the US dollar fell through the floor. Across the globe, but especially in the US, paper currency was being printed like monopoly money in an attempt to stimulate (aka quantitative easing, a banking euphemism) the economy which suffered its worst crash since the Great Depression of the 1930’s.