I hesitate to write this because of the risky nature of the content, but offer it to the reader for your prayer and discernment.

Many have written about the coming economic collapse. As an economist, I agree whole-heartly with them. No one that I know of however, seems to offer specific practical advice on how to prepare. I agree with the advice of those who say pray, trust God, obey Him, follow His directions, and I believe the Lord will lead multitudes like this and provide miraculously for them. I also howver, offer these practical comments with fear and trepidation and tell you to take it to the Lord for his guidance.

Most markets are cyclical, over time they tend repeat cycles. At present the stock market is very high (despite the last 2 years), gold and silver by contrast are at historic lows and have been for much of the last 20 years. They also tend to rise exponentially in times of depression, war or stock-market collapse. Knowing this from my own knowledge, I was praying about investing in gold in January, and God gave me Ps 48:7 " You destroyed them like ships of Tarshish shattered by an east wind." Knowing that ships of Tarshish were merchant ships I looked it up. Ezekiel 27:12 & 25-27 speak of the ships of Tarshish and carrying silver, iron, tin and lead, and also being destroyed by an east wind in judgement. 1Kings 10:22 speaks of Solomon having ships of Tarshish carrying silver and gold. At first I was perplexed by the Scriptures apparently not giving much hope for gold and seemingly saying gold and silver carriers were to be destroyed.

With a little research, I suddenly gained a totally new picture. As I previously said, the price of gold and silver are at historic lows. The reasons for this are the selling of gold by central banks, but more importantly the leasing of gold from central banks by bullion banks. These banks are in what is known as the ‘gold carry trade’. Central banks, instead of receiving no interest on the gold sat in their vaults, lease it out to bullion banks, such as JP Morgan, Chase Manhattan, Deutsche Bank etc. These bullion banks sell the gold on the open market and ‘short sell’ it via futures contracts. The bullion banks buy from mining companies via hedge contracts that allow them to buy gold in the future at set prices from gold mining companies. With this gold they can pay back the central banks. The net result of this triangle is a huge amount of gold selling that has hugely depressed the gold price. If the price of gold were to rise, the bullion banks who owe the central banks huge amounts of gold and have also massively short sold gold would be in deep trouble. They would be forced to buy gold at higher prices to fill contracts at lower prices. Because of their huge positions, this would send many of them bankrupt. Mining companies who have also sold forward many years of production may also be sent bankrupt if they cannot supply all the gold already sold and have to buy at higher market prices.

In other words, after a 20 year bear market in gold, the price is incredibly low, and ready to soar. The ‘east wind’ from the scriptures which destroys the ‘ships of tarshish’ (carriers of gold and silver – ie the bullion banks), I suddenly understood was Japan and China. Daily reports are coming out about Japanese buying more and more gold and demand from China is also increasing greatly. As demand from the East increases, it puts great upward pressure on the price of gold, which will ultimately shatter the bullion banks who have massively manipulated and depressed the gold markets. The banks will be shattered by their debt to central banks for sold gold, and by their ‘short’ selling of gold, which means they will owe huge sums if gold goes up. ( A ‘short’ is selling a commodity or stock today and hoping to pay it back at a set date in the future at lower prices. If prices rise however, purchase must be made at higher prices. These future contracts are highly leveraged so that a small change in price results in big gains or losses.)

The bottom line is, I believe God was saying the demand from the east will shatter the carriers of gold who have manipulated the market for their gain for so long. It will result in economic collapse as banks go bankrupt and sharemarkets plunge. With economic collapse and being free from price supression, gold will soar.

Silver is an even more manipulated market than gold, and without going into too much detail, it is also set to soar, possibly even more than gold.

I believe God will care for his people supernaturally in days of economic collapse, but I also believe he wants his kingdom to continue advancing, and missions and such like to be supported. I believe buying of physical gold and silver, and of gold and silver shares of UNHEDGED mining companies, will be huge protection in the coming days. (Unhedged means a mining company which does not sell forward its gold and silver but sells them at spot or current prices.)

Physical gold or silver is the safest investment, mining shares are more leveraged and so a 1% increase in the price of gold or silver can mean a 5-10% increase in the mining share price.

I have sat on this for a while waiting for God to confirm that it is to be posted. I have been looking for other posts saying the same thing. Suddenly, this week, Peter George posted ‘Visions of a Banking Nightmare’ saying exactly the same things.

Again, the purpose of this is not for Christians to hide in the hills with guns and stores of food and gold, but so that Christians are able to bless others in coming times of great need, and so that all the financial resources for the work of the kingdom are with God’s people.

Pray about this, get confirmation from God, do your own research on the subject, and if God so directs you, be a good steward of his resources, by putting a portion of your wealth into the form of physical silver and gold and/or unhedged silver or gold mining stocks.

Darren Lawson (26^th March 2002)