Sunday, October 9, 2011

“The Borrower is Slave to the Lender.” - Proverbs 22:7 -

“The Borrower is Slave to the Lender.”
- Proverbs 22:7 -

By Keith Bunn Jr.
October 9, 2011

Well, if this whole recession deal doesn’t make you think that Proverbs 22:7 is real, then maybe what China is recently doing might. It was reported on September 14th by that China will be buying up some of the European debt. If they haven’t done it yet, they plan to take their  $3.2 trillion of reserves and help out Greece and Italy by buying up there debt to help stabilize the Euro. This is only a temporary fix. They (Greece and Italy) still have to pay that money back, but instead of owing to several different lenders, they just owe China now. That would be like you and I getting a debt consolidation loan where we wrap up all our credit cards, car loans, mortgage, etc… and put it into one giant loan. That doesn’t solve anything, you just moved the debt, you didn’t pay it off and then you just keep doing what you’ve been doing that got you in the mess in the first place. As Larry Burkett said, “Debt is not the problem, it is the symptom.” The countries of the world (U.S. included) are going to have to pull their heads out of the sand and actually deal with their over spending and debt problems. The Keynesian (see Aug. 21st blog, ‘Then and Now’ ) way of thinking DOESN’T WORK!! It doesn’t matter who they borrow the money from.
As of right now, this puts China in the power seat when it comes to a financial power for the simple fact they don’t over spend, they have money for emergencies, and they’re able to invest in other country's bonds, but this also leaves them in a vulnerable spot too because if the countries they have put billions of dollars into go bankrupt, then they just lost their money. It will be interesting to see how these events unfold.

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