A Gold-Hating Christian Investment Adviser Advises Against Buying Gold, as Always.
Dec. 3, 2009
Yesterday, someone posted a link on one of my site's forums, a link to a Christian investment adviser who says that gold's price is too high.
My first response to all such statements about gold's high price is to search the Web to see when the critic told people to buy gold. I usually find that he never did. Sometimes, he bad-mouthed gold all the way up.
Once in a while I find a professional gold-hater. The man did not just miss the boat. He warned people not to climb in. Such a man is Wilfred Hahn.
I had never heard of Wilfred Hahn until yesterday.
First, he promotes himself as an expert in Bible prophecy. He is not. I have spent 50 years studying this topic. I have written a book on this, Rapture Fever, which you can download free. I have published others' books on it. Let me say, as someone who has spent a lot of time on this, he does not know what he is talking about.
He begins as follows:
Crucially, gold also plays a significant role in prophecy. Today's world, with its fiat and corrupt monetary systems, will want to heed what the Scriptures say about gold, especially its "last day" roles and possibly also its use during the Millennial period.
Gold plays no role at all in biblical prophecy regarding contemporary events. Neither does silver. Neither does fiat money.
If you look up "gold" or "silver" in a Bible concordance, you will find many passages praising both metals. Gold and silver are used as standards of high value -- something that wisdom is worth more than (Proverbs 3:13-14; 8:10). You will also find warnings against trusting in wealth, with gold or silver used as the best examples of wealth.
Unfortunately, there exist some serious misconceptions and false hopes about gold today. Not only do we want to tackle these issues. We also will direct our inquiry to the future role of gold -- a very big one, indeed.
He sets people up for a double-whammy: bad theology and bad economics. It's a package deal.
This "late, great" era of human history -- from a commercial point of view, we can call it the Age of Global Capital -- is marked by world-wide fiat money and sophisticated forms of monetary corruption and theft.Because of these conditions, many people seek a safe haven for their savings. Investors therefore value gold for what they believe is its property of "real money." Come hyperinflation, perhaps a massive economic depression, monetary debasement by corrupt governments or any other form of economic theft, gold will reliably hold its value "in season and out of season" they reason. Is this really the case? No … at least not reliably. We could cite reams of supporting economic and financial history on this point, both ancient and modern.
Gold has preserved economic value longer and better than any other asset. Roy Jastram's book, The Golden Constant, proved this over 30 years ago. Mr. Hahn has obviously not read it.
Now he raises the issue of wealth in general, but he wants to fool his ill-informed Christian readers. I call this "putting the shuck on the rubes." He takes Jesus' words about wealth in general, which Jesus categorized as gold, and targets gold alone. The reason why Jesus used gold as the surrogate for all wealth is because the Old Testament did, too. Gold is universally regarded as wealth, so Jesus used it as a surrogate term.
Before going any further, it is therefore important to settle this point of "false hope." In this present age, gold -- as alluring and hopeful as it may appear -- does not offer a sure escape from monetary corruption nor judgment. It may be a promising investment from time to time. It may even provide protection from the ravages of inflation during certain periods. But it will not provide assurance against a world "where moth and rust destroy, and where thieves break in and steal." (Matthew 6: 20) It cannot. In the first place, we must remember that Jesus Christ still remains in heaven and that therefore this world still remains thoroughly corrupted. "He must remain in heaven until the time comes for God to restore everything, as he promised long ago through his holy prophets." (Acts 3:21)
"In this present age, gold -- as alluring and hopeful as it may appear -- does not offer a sure escape from monetary corruption nor judgment. It may be a promising investment from time to time." What Christian ever said that gold so serves, today or at any time? This is a classic stick-man argument. It is so blatantly fallacious that only a man unskilled at rhetoric would use it. (I am a man who appreciates good rhetoric.)
"We also have already commented on the evolution of gold's role in the last days." First, "we" did no such thing. He did. (I hate the "editorial we.") Second, he asserted it. He offered no proof. He tries to provide proof. He fails.
That is our time -- the period during which the "spirit of the antichrist" (1 John 4:3) and the Great Deceiver is working furiously. Gold plays a relatively minor part of what becomes a highly sophisticated and advanced Babylonian system. James, in fact, prophesies, "Your gold and silver are corroded. Their corrosion will testify against you and eat your flesh like fire. You have hoarded wealth in the last days." (James 5:3) While there is much debate as to whom he is referring and to what exact period this prophecy applies, we can safely conclude that this process of "corrosion" is well advanced if not near complete. The judgment aspect of James' prophecy (James 5:1-6) likely occurs during the Tribulation period (or perhaps also before the Bema Seat).
James was commenting on rich men's bad habits in his day. There is no book in the Bible more hostile to rich men. Second, the book of Hebrews specifically identifies the era of the New Testament authors as "these last days" (Heb. 1:2)
The Bible shines additional light upon the Tribulation period. Gold holdings will be of little help at that time. The Lord says, "They will throw their silver into the streets, and their gold will be an unclean thing. Their silver and gold will not be able to save them in the day of the Lord's wrath." (Ezekiel 7:19) Also, people will continue to hold on to their materialistic idolatries and corrupt financial systems despite terrible times. "The rest of mankind that were not killed by these plagues still did not repent of the work of their hands; they did not stop worshiping demons, and idols of gold, silver, bronze, stone and wood--idols that cannot see or hear or walk. Nor did they repent of their murders, their magic arts, their sexual immorality or their thefts". (Revelation 5:20-21)
The Great Tribulation took place at the fall of Jerusalem in A.D. 70. See David Chilton's book on this. It's free. I published it. And, yes, gold was of little help to the Jews trapped by the Roman legions in A.D. 70. Those trying to escape were sometimes caught and cut open by Roman legionnaires to see if they had swallowed gold coins. Then the survivors were crucified.
Next, he offers a guess, based on nothing specific.
Gold may also play a central part of the Millennial economic system. However, this aspect of gold would be more of a deductive conclusion. It seems not to be conclusively mentioned in the Bible. In any case, such interpretations from several prophetic statements involving gold, would depend upon their chronological placement.
In short, he doesn't know.
Then his attack on gold begins in earnest.
Golden Idolatry is MisplacedBack to the present. There is an extreme idolatry -- even a pseudo-religion -- that has grown up around gold, especially so in North America. Indeed, there exists a sizable industry that likes to hock gold bullion and numismatic investments (rare coins) as if gold were God's very own money and the perfect way to run a monetary system. Such claims are surely overstated. Gold is not the be-all-and-end-all to the world's problem of corruption and sin.
This man lives in a mental world inhabited solely by stick men.
Often, the age of the gold-standard of the late 1980s -- when Britain was at the centre of global finance and the kingpin of the Gilded Age as the world's strongest reserve currency--is held up as the great age of money stability. Actually, this era had its problems and accidents, too. The success of this period is heavily mythologized. There were problems, inflations and financial collapses during that period, as there are today. Writes, Guilo Gallarotti, "Widely considered the crowning achievement in the history of international monetary relations, the classical gold standard (1880 -- 1914) has long been treated like a holy relic."
Ah, yes, a relic. And what other "great" economist -- actually, a guy with only a B.A. in math -- also dismissed gold as a relic?
"We must also recognize that it was a different world then." You can see what idea underlies this statement. There is no economic theory that governs all eras. There is only situational ethics, money-wise.
Today given the interconnectedness and explosion of financial wealth, gold only plays a bit actor role in the world's financial shenanigans. The entire value of all existing gold today (a little over $3 trillion in US dollar terms) amounts to only about one-half of 1% of the total financial "position value" of the world today. This is despite the fact that fifty percent of all gold in existence has been mined since 1960.
So, the fact that massive debt and fiat money dominate today is an argument against gold. Why, he does not say. It just is.
This man is a standard, run-of-the-mill Keynesian-by-default.
Then comes another example of "I'll read into the text what isn't there."
Man's monetary systems will collapse. "[…] man will be brought low and mankind humbled. […] The LORD Almighty has a day in store for all the proud and lofty, for all that is exalted and they will be humbled […] for all the towering mountains and all the high hills, for every lofty tower and every fortified wall, for every trading ship. The arrogance of man will be brought low and the pride of men humbled." (Isaiah 2:9, 12-17)
The text does not mention money. He is making this up as he goes along.
"Surely, a world monetary system based upon gold, which many advocate, would be better than the reckless systems that prevail presently." Really? Then why attack gold with stick-man arguments?
"After all, money today is nothing more that a paper or digital electronic figment." No kidding!
Yet, gold would certainly not solve the problems of the world that results from mankind's penchant for the "love of money" (1 Timothy 6:10) and greed. Gold was never the solution to such problems in the past, and neither will be in the future."[ …] the cravings of sinful man, the lust of his eyes and the boasting of what he has and does." (1 John 2:16) remains the key propulsion of history and geopolitics. This hasn't changed and will not until "all things are restored."
So, gold is good but gold will not solve the big problems. Why not? Because, in the outlook of dispensationalists, there is no solution to any social or economic problems until the Millennial era.
This is just one more example of bad Bible exegesis coupled with bad economics to produce a world without hope or recovery -- a world without solutions until Jesus comes in person to reign by means of international, top-down bureaucracy enforced by angels. Maybe we can call this the New World Order.
What is the outlook for gold? According to the Bible, indeed, gold will someday again have a prominent role -- very possibly in the Millennial period, and surely during Eternity.
He has offered no proof.
It seems sure that the gold in existence today will pass into the Millennium, remaining intact. Of course, that information will be of no practical use for Christians living today.
This is the mindset of dispensationalism. Nothing that Christians do today supposedly carries into the post-Rapture, post-Great Tribulation world. This outlook strips today's Christians of all earthly hope. It leads to an intense present-orientation, or what Ludwig von Mises called high time preference. It undermines long-term planning.
For now, it is best to remember this one fact: Gold has not yet assumed its Millennial or Eternal role. Therefore beware. We live in a time of great deception and corruption. And, as such, try as the righteous might to make their way on this earth, the Bible says such conditions will continue to heighten until it meets its judgment. On this side of the Millennium, gold will remain manipulated as is everything else in the financial realm. Continuing as before, "thieves break in and steal." (Matthew 6:19)
Gold will be useful in Jesus' international bureaucracy, with Him as senior bureaucrat, but not today. In short, gold is economically irrelevant today.
Conclusion: we should trust fiat money. He refuses to say this, but this is the inescapable implication of his position. Gold will be for "pie on the earth by and by," seven years after Christians are "raptured" into the sky. Today's Christians must content themselves with fiat money. No stable money for us! No gold standard for us!
We will see that future restoration, probably looking down from above. In the meantime, we turn from all the false idols of gold that the world may flaunt, instead seeking "purses for [ourselves] that will not wear out, a treasure in heaven that will not be exhausted, where no thief comes near and no moth destroys." (Luke 12:33) We, "rejoice, though now for a little while [we] may have had to suffer grief in all kinds of trials. These have come so that [our] faith--of greater worth than gold, which perishes even though refined by fire--may be proved genuine and may result in praise, glory and honor when Jesus Christ is revealed." (1 Peter 1:6-7)
He signed off: Wilfred J. Hahn - August 2007
About the Author: Wilfred J. Hahn is a global economist/strategist. Formerly a top-ranked global analyst and chairman of the country's largest global investment operation his writings focus on the endtime roles of money, economics and globalization. He has been quoted around the world and his writings reproduced in numerous other publications and languages. His most recent book is The Endtime Money Snare: How to live free.
He may have been quoted around the world, but a search on Google reveals that he has not been quoted on the Web -- and not on anything other than Bible prophecy.
He refers us to his site: "For resources on "endtime economics" and to subscribe to the free newsletter, Eternal Value Review, visit Wilfred's website www.eternalvalue.com or contact him at mulberryministry@telus.net."
A subscriber posted a link to the December issue of his newsletter. There we read the same old story, but more irrelevant. For example:
Don't forget that gold bullion does not yield income (for the average investor, in any case). You can't live on income from gold. You must sell it to generate the cash to live on. Investments that yield high-income (i.e. interest or dividend payments) are likely to be just as eagerly sought during these threadbare times of income. In fact, to date in 2009, did you know that high-yield bonds have far outperformed gold? High-yield fixed-income investments year-to-date have faired much better. This fact alone should caution the rampant gold bulls.
The Federal Reserve is holding the federal funds rate at zero to 0.25%. People are paid under 1% on their savings accounts. But gold has gone up. Do think there might be a causal connection? Do you think that, because people get no income on their savings accounts, it does not cost them anything in forfeited income to invest in commodities? This has not occurred to Mr. Hahn -- or else he thinks he can put the shuck on the rubes.
He concludes:
To sum up, why should gold be such an attractive investment right now? Most people, of course, would answer this question quite simply: Because it is going up in price! Well, yes, that has been obviously the case looking in the rear view mirror.
Mr. Hahn's readers do indeed suffer from a rear-view mirror problem. He bad-mouthed gold all the way up. If they took his advice, they bought none.
Gold may indeed get caught in a psychological updraft for no other reason than the hyped and emotional fears of the masses for a time. However, as we have pointed out, it is not a one-way bet as may be popularly presented. Even as gold prices have risen, the very seeds of its future collapse can already be discerned.
The masses are not hyped. The central bank of India is hyped. It just spent $6.7 billion to buy half of the International Monetary Fund's listed sale.
Financial trends are highly deceptive and rarely reward the frenzied masses. What to do? Firstly, stay rational. Being a wise steward means that one must strive to make reasonable, balanced decisions … not emotional ones. No matter how sure one might about any investment or endeavour, it makes sense to diversify one's investments. Why? Absolutely nothing in the world of money is certain.
"Absolutely nothing in the world of money is certain." That, plus $5, will buy you a cup of coffee at Starbucks.
Secondly, do not allow yourself to be swayed by the fact that the person from whom you are receiving advice is a Christian (or may claim to be one). That may seem a harsh warning. There indeed may be good reason to trust your advisor, yet, it remains a fact that Christians are no more accurate predicting future investment market trends than anyone else.
Speak for yourself, Wilfred!
In fact, it would not be surprising if they were worse. Why? Markets are amoral and treacherous. Why should Christians excel in such environments? Keep in mind that the sharpest brains in the investment world are frequently proven wrong. To wit, almost the entire economic and financial community didn't see the Global Financial Crisis coming. Why should the majority of them be right in their prognostications about gold in the future?
Just for the record, I saw it coming and said so repeatedly. Austrian School economists saw it coming, and said so repeatedly. But Mr. Hahn dis not listen.
The bottom line? Don't get carried away by the pitchmen and cheerleaders for gold who want you to take out a mortgage on your house and to load up on gold related investments. That is not prudent. Rest easy.
This man is intellectually unscrupulous. He uses phony rhetoric to criticize people who do not exist: people "want you to take out a mortgage on your house and to load up on gold related investments." This man lies. He lies for rhetorical effect. He lies for Jesus. If he says he is telling the truth, let him post on his website two or three links to people in the gold camp who recommended this strategy. He invents stick men to keep his Christian readers from taking steps that can protect them from central bank policies and government policies that threaten their wealth. They trust him. They shouldn't.
I am indeed a cheerleader for gold. I am therefore not a cheerleader for fiat money. Mr. Hahn inevitably must be a cheerleader for fiat money, because he is a bad-mouther against gold.
Diversify your retirement portfolio, never bet, nor expose yourself to possible losses that you cannot comfortably sustain. Gold frenzy? In time, this too shall pass.
In short, he offers no specifics to his readers. A Christian might ask about the bad times we are facing: "But what should we do?" He answers: "Wait for the Rapture." The Christian asks: "But how should we invest?" He answers: "Diversify." The Christian asks: "But what about gold?" He answers: It's for the millennial era." The Christian asks: "But what about now?" He answers: "It's overpriced." The Christian asks: "But what about in 2000, 2001, 2002, 2003, 2004, 2005, 2006, 2007, 2008, and earlier this year, when I could have bought gold lower?" He answers: "It's too speculative. It's always too speculative. Stick with bonds."
CONCLUSION
This sort of "pie on the earth by and by, seven years after I'm in the sky" has been the curse of fundamentalist Christianity since the 1870's. The mindset is incurable. It deliberately offers no real-world solutions to rulers or the ruled, other than standard opinions from inside the secular world. In Hahn's case, it's "diversify (and don't buy gold)."
I have spent 45 years refuting this theology. While it is still popular in the pews, it has faded in the once-dispensational seminaries. The old Scofield Reference Bible notes are not taught in today's "progressive dispensationalism" seminaries. The donors are not told about this shift. I have watched it take place for over two decades. As the seminaries' founders have died off, their replacements have quietly abandoned the old system. Young men are no longer taught out of Chafer's Systematic Theology. Its publisher, Dallas Theological Seminary, surrendered the printing rights over two decades ago. The movement is fading because it cannot find seminary-trained replacements for the pulpits. Jimmy Swaggart told me in 1986, "I'm the last of the old-time dispensationalists." This was not quite the case, but not too far off the mark. Mr. Hahn seems unaware of this development.
My secular peers may wonder why I spent 36 years writing a 27-volume commentary on the economics of the Bible. Here's one answer: to offer something better to Christians than the anti-gold propaganda served up by men like Mr. Hahn.