Here is an analogy of where the world is at today:
Airline captain to passengers:
“Passengers, I have some bad news and some good news. The bad news is that we have flown off the map! We have no idea where we are or where we are headed. But the good news is that we are going faster than any aircraft has ever flown!”
I am sending out this blog to talk about the coronavirus and what I believe will be long term impacts on our collective futures. I will try to be as brief as I can, and will break my thoughts into four sections: Health impacts, economic impacts, social impacts and spiritual impacts, all from a Christian perspective.
With all the wailing and gnashing of teeth now flooding the worlds media, there is an dawning awareness in most people’s minds of how badly this virus will affect millions in your country, and your family. Western leaders were intellectually lazy and slow in waking up to the fact of an exponential disease curve and how it devastates a country. Asian leader had seen this play out before so were quicker off the mark. However, western leaders are finally on board and locking down their people en mass to protect them. If the 3% death rate is going to be the average moving forward then this disease will be the event of our lifetimes, if we survive it.
Let’s run the figures: Three percent means 0.75 million Australians, 10 million Americans, 1.8 million Italians, 40 million Indians and 6 million Pakistani’s dead. Got the picture now? We are all hoping for a lower death rate, but even if you slash the rate to 1% we are still talking horrific numbers. Vaccines will be available in around 12 months at the earliest. In the meantime some anti-malaria drugs are helping. This event will leave us all emotionally scarred for the rest of our lives. It is a culling of the old, the obese and the sick on a monumental scale. Even among young people the death rate is one in 500 while leaving many more with lung impairments as this disease basically pours “concrete” into your lung’s air sacks in the acute stage.
The impacts on the global economy are many, much longer lasting and equally horrific for all of us. The world is about to become much poorer. Permanently! The whole world has been bingeing on debt for fifty years, deluding us with the lie of endless economic growth. Financial collapse was finally supposed to happen in 2008. We came within hours of a global banking collapse but more debt came to the rescue and we delayed the day of reckoning by 12 years. We are now paying the price and the coronavirus was just the pin (shotgun?) that popped a ludicrous financial bubble that should never have existed. In fact there were bubbles in global stocks, global bonds and global real estate, all built on debt. Debt robs the future to enjoy the present. It rots society. This is why the Bible speaks against it over 70 times. We were living beyond our means and now we must live below our means for quite a while.
The US Federal Reserve is expecting up to a 50% contraction of the US economy in Quarter Two (April-June) 2020. This is 2.5 times the contraction at the height of the Great Depression, and 10 times the contraction in 2008! Think about that for a minute. Now extrapolate this figure out to the whole world and to the unthinkable unemployment levels, the millions of bankruptcies and the end of millions of careers, dreams and futures. The experts are all hoping for a V shaped economic recovery. But with 10 months to go till a vaccine is found, and millions of deaths to come, the V will actually be an L.
The reality of this economic event is that the entire global fiat monetary architecture: The central banking system, the IMF, World Bank, never-ending and now exploding US deficit budgets, international trade, just-in-time finely tuned global supply chains and confidence in the US$ as THE global currency backed by the global oil trade…JUST BROKE!!! March 2020 will be looked back upon as the month the global elites lost control, forever. An entire generation will now grow up without much in the way of career or employment prospects, money or material hope, thanks to the collapse of their system. Personal and economic survival will be paramount. We are entering a global economic depression. Get ready for it.
Another long term economic impact will be the eventual return of rampant consumer inflation, something we have almost forgotten about since the 1970’s. Financial inflation has been ongoing in stocks, bonds and housing, making the baby boomers very happy (but with the virus decimating them and their savings collapsing, their era just ended). With the many trillions of Dollars, Yen, Yuan, Rupees and Euros now being helicoptered to us and, and with more promised to us almost daily, inflation is already being baked into the global cake.
All those extra units of currency will eventually come out of their bunkers and get spent. So expect uncomfortably rising prices for many years to come once the initial deflationary supply and demand shocks are over. Let’s hope it does not morph into hyper-inflation as it did in Weimer Germany, Zimbabwe and Venezuela. Sadly, for the last 800 years, this inflating away of financial problems has been the tried and true method of all European and colonial governments. Inflation is coming but it may eventually blow up in everyone’s faces if we keep trusting fiat currencies. Sound money, that is gold, will eventually come back as the basis of our financial system. The cause of this mess is our abandonment of sound money over the course of the 20th century as we walked away from God.
Choices will shrink, luxuries will disappear. I predict here and now that the world has just passed peak prosperity in 2019 and we will never see that level of affluence again. The reason is twofold. First, the world needs ever more oil production to have increasing affluence. This is simply because machines free us from manual labour in a million subtle ways. Machines mostly run on oil. Less oil; less machines; less global GDP. Conventional oil production actually peaked in 2005 and has remained basically steady ever since. Therefore the only reason we did not see a globally stagnating economy for the last 15 years after the peak of conventional oil production was because of the invention of fracking in the US. Even with the inclusion of US unconventional oil, the world was still going to hit total peak oil around 2021 anyway because of the imminent demise of those US shale oil reserves. That has now been brought forward because they, and many other global producers will all soon be going broke! The shale oil producers gave us an extra ten years of the good times. Second, we just hit peak fiat currency (I won’t use the word money for anything else but gold). Debt liquidation destroys currency because in the fiat system all the worlds currency is simply someone else’s debt. Less currency is like less oil. It can no longer grease the wheels of international trade and commerce. Liquidity has been seizing up for over six months in the US repo market, but now it has been completely frozen globally. The plane just flew off the map.
The double whammy of less currency and less oil will destroy the global elite’s global financial architecture. Banks will fail by the hundreds and businesses fail by the millions. Savings will evaporate if left in the bank. Trust in the god-like status of central bankers will be destroyed. They know there was a mess coming and started preparing some years ago. To this end bail in laws are already in place in all Western countries to confiscate depositors savings so they can recapitalise the banks in case of an emergency. This process began in earnest at the 2014 at the Brisbane G20 leaders conference, which by the way is just down the road from where I am writing! Australia’s bail in legislation was passed in 2018.
This is where we begin to look beyond the immediate medical and economic future and imagine a different world longer term. I see a very low global birth rate for at least a decade as people fear their economic future and put off having families. Abortions will sky rocket at the same time as a baby bump!. Existing families will pull together, back each other up, and provide the support that families have always done for each other throughout history. We will learn to cook again! More people will live in each home for longer. Gardening and localised food supply will become much more popular and important, as will fresh air, bushwalking and sunshine instead of screen time. Neighbours will actually meet (if from a safe distance) and start to look after each other. This is exactly what happened in crisis past and in Cuba during the Special Period from 1991 to 2000. It will happen again globally.
At the same time capitalism will be increasingly seen as an evil and the cause of our coming economic depression. This is not true. The real cause was the fiat monetary system created by the worlds banks and the colossal amount of greedy debt they allowed the world to accumulate. The blame for this can be laid at the feet of the global fractional reserve banking system, greedy governments who spent more than they earned and global central banks that would not let zombie businesses, especially reckless banks and other financial institutions, go broke. Everything got propped up when debt could have been flushed out in 1987, 1998, and 2008. Socialism will become the norm for the next generation of voters in the west. Fascism will also become increasingly popular as strong men tell their people they have the answers. Last time this led to WWII. Let’s hope it doesn’t this time.
Localised learning will skyrocket. Digital schooling, digital parliaments, digital universities, working from home. Already entire newspapers have been designed and published from a thousand homes. The list of localisation events will be endless. This will compound the emptying out of CBD office space and revolutionise education, lifestyles and employment. I can see China collapsing as industries by the thousands re-localise back to their home regions and their debt-riddled economy implodes. The localisation revolution has already begun. Here’s a sample of an online philharmonic orchestra and an online choir.
Cities may lose population, reversing the trend of the last two centuries. Small towns could boom as people choose to be more connected to their food supply and can now work remotely. This social frugality will also extend to attitudes towards finances. Saving for a rainy day will skyrocket so people will live more humbly. Travel, tourism and entertainment will shrink dramatically as a social influence on our lives.
If hyperinflation sets in then social unrest could be widespread, especially in the USA with its culture of guns. The social contract with our leaders depends on them looking after us while we give them power. The first round of “stimulus” in the USA has already demonstrated a strong bias toward crony capitalists and lack of commitment to small America. This could turn very ugly very quickly.
The European Union may collapse. Northern countries resent the money they had to send to the irresponsible south to bail them out last time. They may refuse to do so again. The eastern members increasingly refuse to bow to the politically correct atheism of Western Europe and its rejection of Christian values. The euro is already in big trouble from the 2012 crisis and is on its last legs. This crisis will tip it over the edge. The European Central Bank will stupidly make sure of that. if that happens its game over for the European experiment and England will look like the smartest nation in Europe.
There will be many other long term social impacts. Many cannot be seen from this side of the viral divide. Some will be fantastic technological breakthroughs, others could be sinister. Another long term impact will be less climate change because of the massively reduced carbon emissions and pollution levels. That’s the silver lining nobody has yet talked about. Who knows where our brave new world will lead us, but it is us who decide our long term future. We house both good and evil within us, we will see both the best and worst of these two traits in the future.
Now for some good news! We played God and lost!
Millions will come to Christ their maker as their idols fall one by one. Jesus talked about money more than any other topic except the Kingdom of God. This is because the worship of money is the number on religion in the world. That’s why he called it mammon, the only inanimate object to which he gave spiritual power. We cannot serve God and money (Matthew 6:24). The idol of mammon is now being smashed. The other idol being smashed is the cult of individualism fuelled by full employment. People will now stick together. Family will rise above the individual. Political correctness, collective selfishness, demanding one’s rights and various sexually political agendas will give way to love thy neighbour. As an example, Cuba’s church doubled in size during their Special Period. The same will happen all over the world as people realise the now need to trust in God rather than self.
The lockdowns could go on for months, not weeks. If they do then traditional Sunday church services may never be the same again. Traditional churches are rapidly organising their members into house churches or family churches. House churches and family churches will soon begin to find their feet and grow as time goes on. The coronavirus is creating the biggest shift back to the original New Testament church model in modern history. It will have many positive outcomes as western Christians begin to localise their thinking and outreach. Neighbours will be reached, targeted practical services will go to the needy and Christian social engagement will rise significantly. This was our experience when we did house church 10 years ago.
These two affects are a potent combination that will result in large but as yet unknown numbers of people coming to Jesus. Let’s hope the changes leave a lasting impact on church culture this is the only possible way of winning back the western nations. Jesus showed us exactly what to do when he started a small discipleship movement and won most of Galilee in just three years! The coronavirus will accelerate a global trend toward this same model of small scale discipleship as the means of winning the whole world. It has proved to be incredibly effective in other parts of the world and now it can begin in the West.
The church has the answer to this sinfulness of men. The economic principles of the Bible include minimal debt, the 50 year jubilee, gold as sound money, minimal government and minimal taxation. The government was never meant to play God. The family was meant to be the first and primary form of government. Alas, all this has been turned on its head in recent decades. We have the answers, they are in scripture. Spiritual rebellion led to social and moral rebellion, which led to financial and economic rebellion. Now the house of cards is collapsing, people will soon listen to Biblical wisdom.
Finally, NO! This is not the end times. If it was then the world should have finished in 1918-19 with the Spanish Flu, or with the Black Death, or any of the dozens of the plagues of history. This is just the curse in action. The end of the world will only come when the scriptures at this link have been fulfilled. Spoiler alert: God wins! So forget all the spiritual doom and gloom. This is an opportunity, not a loss. The world will keep going and the church will keep growing.
So, back to earth. They say happiness is having something to look forward to. With not much else to do as we are already in self-imposed lockdown, we signed up for the Disney channel yesterday and the whole tone of the house has changed already!