I am not an alarmist nor a pessimist. But the bad news is that the fast unfolding global financial crisis is so bad that it’s going to be apocalyptic.

Mention the word Apocalypse and we see doomsday coming. The word itself comes from Revelation, the last book in the Bible which in Greek, “apokalupsis,” means a glimpse of things to come.

The crisis may have started in the U.S but it has spread round the world. Already 20 million are out of work in China. And it’s coming nearer and nearer to us.

My friend’s son in Melbourne is getting married next month. In the midst of preparing for the wedding, his future bride was retrenched on one day’s notice. Now the bank he’s working for has announced 400 jobs are on the chopping block. Make no mistakes about it. No one can possibly escape.

My daugther, Ping, has just given birth to her third child. She has left her job to become a homemaker since her first child. Her husband, Jern, works in a bank, and banks are retrenching. We really don’t know what the future holds for them. We cannot discount the fact that a young family of five with a huge mortgage loan to pay may suddenly end up without any income through no fault of their own.

I have just received an email from a former HF member:

Got back to work just 2 days ago to bad news. Both my bosses have been retrenched – our corporate HQ has decided to pave the way and lead the pack by taking the first hit so 20% reduction in overhead is the way to go. To borrow a cliche, the only constant is change so yes, there will be a few changes. Personally I don’t know how this will affect me so I will just wait and see, and trust God…

Now, coming back to the Apocalypse, there’s not enough money or political will left to attend to global warming, poverty eradication, exploitation and social injustice. Millions of the poorest of the poor in the world will continue to die and in greater numbers now.

It’s going to be apocalyptic. It’s both fatalistic and futuristic at the same time. If at all the end will come, it would undoubtedly be with fire and brimstone. Then the future will come in all its glory. Therein lies our hope. But we cannot carry on with business as usual. We need to understand the fundamental notion money. We need to transform our global financial architecture. Only then will the future come.

The reason why we got ourselves into this black hole is that modern economics together with the American, and by extension, the global financial system, is essentially a con game conjured by bankers, economists and the men of Davos. It’s an unholy congregation of the greedy. Unless they turn back on their evil ways, we will all be sucked into the coming Apocalypse.

The International Monetary Fund has warned: “Problems are spreading to other financial sectors including insurance companies, pension funds, and hedge funds. And in addition to U.S. assets, the deterioration is affecting assets in Europe and in emerging market countries.”

But the IMF has always been part of the problem. Speaking on the sidelines of the Davos Forum during the Lunar New Year holidays, British Prime Minister Gordon Brown said the IMF is out of date.

Rightly so President Barack Obama has blasted hefty bonuses paid to U.S. financial executives as “outrageous, the height of irresponsibility and shameful.”

There’s where the rhetoric ends. Already, Obama is taking the easy way out. He has mooted the idea of setting up what is now called a Bad Bank. A clever idea but really it’s just another sleight of hand. It does not take rocket science to understand that the only bank that works has to be a good bank, not a bad one.

The hope is that once defaulting banks get rid of their bad loans by selling them off to the Bad Bank, they can attract private investors, get back to the business of lending, and help revive the economy.

This sounds like a wonderful idea. But in classical economics, this is called throwing good money after bad ones.

The question is who is going to provide the money to set up the Bad Bank? Congress, of course. Where is the money coming from? The U.S. Treasury will no doubt allow the banking system to print more money or I.O.U’s, as always. How much will they print? Now that’s the problem. No one knows.Not even the experts. Initially, the Obama’s boys thought the mess is about US$1 trillion.

The International Monetary Fund said over the Lunar New Year that worldwide losses on U.S.-originated loans may hit $2.2 trillion, well above its October estimate of $1.4 trillion.

Then the experts say it may rise above US$4 trillion. Now, we hear it’s double that amount. No one has a clue how bottomless the black hole is. There was a time we know how much $1 million is. If they are stacked up in $1 bills and one person counts them one by one, it may take five days to count all of it non-stop. For one billion, it would take one person 15 years to count the whole pile non-stop. Now increase that by another thousand times and we get $1 trillion – the digit 1 followed by 12 zeroes. It would take one person 15,000 years to count it. That’s what I mean by apocalyptic.

On top of all that, the U.S. is now bankrupt and is entering its deepest recession ever. Before George W Bush left the White House, he signed away US$700 billion to bail out the banks, half of which has already been used up. Now President Obama has asked for an extra US$700 billion or so to jump start the American economy. Probably much more would be required. And not forgetting that the Iraq War has cost the U.S. some US1 trillion so far and the war is not over yet.

The genesis of the mess is what is called the sub-prime crisis in the U.S. In plain language this means American banks are willing to lend sub-prime or sub-standard borrowers. They have a record of defaulting on loans or have no means repaying. No hope case.

But banks are happy to lend to them. Why? Because they can charge higher interest rates; much higher than the prime rates they charge to prime or creditworthy borrowers. In this way, such rogue banks (and many of them are bigs names) can show big profits in their cooked-up books. To protect themselves, these banks then recycle the risky or dodgy loans into some fancy sounding financial papers like “enhanced financial products” or “restructured investment instruments” and the like to be sold off to other greedy financial intermediaries both at home and abroad. The vicious cycle goes on and on and everyone keep recycling the so-called financial papers until there are no more suckers left and everyone suddenly realise they are caught with debt instruments not worth even the weight of the paper they were printed on. This then, is the sub-prime crisis or the big black hole in the world’s financial system.

Meanwhile, fat cat bankers get paid bonuses for their fraudulent lending or what Obama calls “outrageous, the height of irresponsibility and shameful.”

The end will surely be apocalyptic. It’s both fatalistic and futuristic at the same time. We need a sound financial architecture. But first we need to understand the fundamental notion of money.

The Bible puts it this way:

People who want to get rich fall into temptation and a trap and into many foolish and harmful desires that plunge men into ruin and destruction. For the love of money is a root of all kinds of evil. Some people, eager for money, have wandered from the faith and pierced themselves with many griefs. (1 Timothy 6:9-16 New International Version)

Putting it in context, money is not the root of all kinds of evil but the lust for money or insatiable greed is. Sub-prime credit is but the tip of the iceberg of such obscene greed. We too can become enmesh in the root of all kinds of evil if we borrow when we know we have no means or intention of repaying even if the banks are offering 0% loans. Yes, the Apocalypse will come. So too will the future .

What do we do? It’s too late for some of us. But there’s still hope.

Psalm 121
A song for pilgrims ascending to Jerusalem.

I look up to the mountains—
does my help come from there?

My help comes from the Lord,
who made heaven and earth!

Many are still looking up to the mountain of money, of Mammon. No Help comes from there rest assured.

For some of us, there may be some time left to re-organise our debts. But for all of us, there is more than ample time to re-organise our spirituality and look in the right direction.

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