Interest rates to rise? Short and long term ramifications

Janet Yellen, Federal Reserve Chair

There are two events this week that the Wall Street Journal believes may have significant economic impact:

September 15, 2014

Enough of the quiet data weeks. This one could be a blockbuster, with two major events dominating headlines. On Wednesday all eyes turn to Federal Reserve Chairwoman Janet Yellen’s bimonthly press conference, where her language will be watched closely for clues on the timing of a rate hike. On Thursday, Scots go to the polls to vote on independence from the U.K. …

This meeting is important because we get to hear Ms. Yellen speak again at her bimonthly press conference and because FOMC members can provide an update to their forecasts for short-term interest rates. Before this meeting, we had an especially disappointing jobs report, which is expected to underpin Ms. Yellen’s hesitance to rush toward a rate increase next year. But other indicators are showing signs of relatively robust growth, so there’s a chance the Fed could firm up its signal on that. Significantly, it’s expected that the Fed statement could remove the phrase “considerable time” to describe the expected lag between the end of bond-buying at the end of this year and the subsequent first rate hike. http://blogs.wsj.com/moneybeat/2014/09/15/what-matters-for-global-markets-in-the-week-ahead-31/

Related to the vote in Scotland–the major banks based in that area have already said that they would relocate out of Scotland if it votes for independence. There will also be a lot of other economic ramifications for the UK if Scotland does actually vote to leave.

As far as the Federal Reserve meeting, notice the following that came out in anticipation of Wednesday’s meeting:

September 15, 2014

(Reuters) – Major commodity markets, many already trading near multi-year lows, could face more pressure should the U.S. Federal Reserve fuel fresh gains in the U.S. currency this week, weighing on dollar-priced raw materials.

The mere prospect of a climb in U.S. interest rates has lifted the dollar to multi-month highs, and it may rise further if the Fed confirms on Wednesday after its policy meeting that a rate hike may come sooner rather than later.

This would be bad news for commodities, analysts and investors said, due to their strong negative correlation with the U.S. dollar.

Precious metals may be the most susceptible, as gold prices in recent days have shown their strongest negative correlation with the dollar in two years, at over minus 0.94, indicating a nearly matching fall in gold as the dollar rises.

Silver and platinum have also displayed strong negative correlations, suggesting the precious arena could suffer as a whole if the dollar gains. http://www.reuters.com/article/2014/09/15/us-commodities-markets-dollar-idUSKBN0HA0WV20140915

So, many are wondering how quickly the US Federal Reserve will raise interest rates, and some of the financial markets are reacting in anticipation.

Several years ago, the US Federal Reserve created a series of programs called quantitative easing (they have been numbered as QE1, QE2, and QE3). These programs have made USA interest rates artificially low by, instead of just borrowing from regular creditors, the US Federal Reserve essentially pretended to borrow money by electronically printing it up and at the same time getting US Treasury notes to supposedly back up what it printed. While other countries could not get away with this for long, because the US dollar remains the world’s reserve currency, it has, for now, appeared to have gotten away with it.

Eventually interest rates will rise. At first, as this will increase the rates savers will get for cash, this will tend to draw some money away from other investments such as commodities and probably stocks.

Yet, because of massive USA debt, the debt will increase faster as the USA will owe more money from increased interest obligations on its debt.

Eventually, this will feed more into itself and result in hyperinflation and severe economic problems. Commodities will sometimes drop in value as the economy worsens while they will also tend to rise in value as the USA dollar faces inflationary pressures.

Hyperinflation has hit others in the past, and despite what some may wish to think, the USA itself is not immune from it. Its debt policies seem determined to cause it some day. The time will likely come when USA interest rates will rise so much that this will ultimately cause a crisis of intense magnitude. The admitted US federal debt (not counting the money created through the quantitative easing programs) is so large that if interest rates rise to the place that they were in the USA in the early 1980s, the USA will have difficulty even paying the interest on the debt it has been accumulating. This will tend to cause interest rates to further rise and contribute to hyperinflation.

The Bible teaches the following:

13 “Behold, therefore, I beat My fists at the dishonest profit which you have made, and at the bloodshed which has been in your midst. 14 Can your heart endure, or can your hands remain strong, in the days when I shall deal with you? I, the Lord, have spoken, and will do it. 15 I will scatter you among the nations, disperse you throughout the countries, and remove your filthiness completely from you. 16 You shall defile yourself in the sight of the nations; then you shall know that I am the Lord. (Ezekiel 22:13-16)

43 The alien who is among you shall rise higher and higher above you, and you shall come down lower and lower. 44 He shall lend to you, but you shall not lend to him; he shall be the head, and you shall be the tail. 45 Moreover all these curses shall come upon you and pursue and overtake you, until you are destroyed because you did not obey the voice of the LORD your God, to keep His commandments and His statutes which He commanded you…47 “Because you did not serve the LORD your God with joy and gladness of heart, for the abundance of everything, 48 therefore you shall serve your enemies, whom the LORD will send against you, in hunger, in thirst, in nakedness, and in need of everything; and He will put a yoke of iron on your neck until He has destroyed you. 49 The LORD will bring a nation against you from afar, from the end of the earth, as swift as the eagle flies, a nation whose language you will not understand, 50 a nation of fierce countenance, which does not respect the elderly nor show favor to the young. 51 And they shall eat the increase of your livestock and the produce of your land, until you are destroyed; they shall not leave you grain or new wine or oil, or the increase of your cattle or the offspring of your flocks, until they have destroyed you. 52 They shall besiege you at all your gates until your high and fortified walls, in which you trust, come down throughout all your land; and they shall besiege you at all your gates throughout all your land which the LORD your God has given you (Deuteronomy 28:42-45,47-52)

3 For the vision is yet for an appointed time; But at the end it will speak, and it will not lie. Though it tarries, wait for it; Because it will surely come, It will not tarry…5 Indeed, because he transgresses by wine, He is a proud man… 6 “Will not all these take up a proverb against him, And a taunting riddle against him, and say, ‘Woe to him who increases What is not his–how long? And to him who loads himself with many pledges’? 7 Will not your creditors rise up suddenly? Will they not awaken who oppress you? And you will become their booty. 8 Because you have plundered many nations, All the remnant of the people shall plunder you (Habakkuk 2:3,5,6-8).

The United States is the most indebted nation of all time and the UK is one of the most indebted on a per capita basis. In that respect they have recently plundered many nations. And while much is owed to nations such as China, Japan, and the Arab World, the Europeans have trillions of dollars invested in the USA–money they may be disappointed to have devalued. Enough so that they may divide the land among themselves and other creditors (cf. Daniel 11:39; Habakkuk 2:6-8).

Many will dismiss this and says conclude that since the USA has been able to increase its debts that this will be able to go on forever, despite what the Bible says. Those who doubt the Bible will be proven wrong. That being said, it is likely, because of the USA dollar’s position in the world, that it will take a combination of events for creditors to rise up.

Once interest rates get too high, the USA will have an economic crisis of unbelievable magnitude. Worse than I believe that Janet Yellen has considered.

While the Federal Reserve meeting and the Scottish vote this week are not the true cause of the problems that will happen, they are also not the solution. Monetary policies in the USA and UK are setting both up for a major fall in the future.

Federal Reserve officials, Scottish residents, and others may wish to consider studying the following prophetically-oriented information:

Project Prophecy: Economic Collapse Starting in 2015? Jim Rickards once worked for the CIA and also was once part of a a USA government program called called ‘Project Prophecy.’ He has a video were he claims that starting in 2015, the USA may have economic collapse resulting in a 25-Year Great Depression. He mainly cites debt figures and claims advises alternatives to the USA dollar which he says will collapse? What did Rand Paul state? Can the USA dollar collapse? This is a video.
Anglo – America in Prophecy & the Lost Tribes of Israel Are the Americans, Canadians, English, Scottish, Welsh, Australians, Anglo-Saxon (non-Dutch) Southern Africans, and New Zealanders descendants of Joseph? Where are the lost ten-tribes of Israel? Who are the lost tribes of Israel? What will happen to Jerusalem and the Jews in Israel? Will God punish the U.S.A., Canada, United Kingdom, and other Anglo-Saxon nations? Why might God allow them to be punished first? Here is a link to the Spanish version of this article: Anglo-América & las Tribus Perdidas de Israel. Information is also in the YouTube sermons titled Where are the Ten Lost Tribes? Why does it matter? and British are the Covenant People. A short YouTube of prophetic interest may be Barack Obama and the State of the Apocalypse.
Will the Anglo-Saxon Nations be Divided and Have People Taken as Slaves? Will the lands of the United States, United Kingdom, Canada, Australia, and New Zealand be divided? What about Jerusalem? What does Bible prophecy teach? Are there non-biblical prophecies that support this idea? Who will divide those lands? Who will end up with the lands and the people? Here is a link to a video titled Will the USA and other Anglo-nations be Divided and Their People Made Slaves? Here is a related item in the Spanish language ¿Serán divididas las naciones anglosajonas?
British are the Covenant People What do ‘British’ and ‘Britain’ mean in Hebrew? Are the descendants of the Anglo-Saxons people of the covenant? Does the British royal family connect to the throne of David? What does the Bible teach? What does history show us? Is there any DNA evidence related to British-Israelism? When did Christianity make it to the British Isles? Could Jeremiah have made it to the British Isles? What type of Christians made it to the British Isles? Did the last King of England believe in British Israelism?
Hillary Clinton in Prophecy Prophecy, Hillary Clinton? Are there prophecies that Hillary Clinton may fulfill? Are there any prophecies that she has already helped fulfill? Could Hillary Clinton be apocalyptic? Could Hillary Clinton be the final Antichrist?
Canada in Prophecy: What Does Bible Prophecy, Catholic Prophecy, and other Predictions Suggest About the Future of Canada? There are prophecies that suggest involvement with Canada. And many are not positive about its future.
Protestant and Church of God views of the United States in Bible Prophecy Is the USA mentioned in Bible prophecy? Some Protestants say yes, while others say no. What does the Bible really teach? Learn the truth about this. There is also a video available: Is The United States Mentioned In Bible Prophecy?
Physical Preparation Scriptures for Christians. We all know the Bible prophecies famines. Should we do something? Here is a version in the Spanish language Escrituras sobre Preparación física para los Cristianos.
The Plain Truth About Gold in Prophecy. How Should a Christian View Gold? What do economists and the Bible teach about gold? Gold and silver may drop in value. Inflation/deflation? What do Christians need to know about gold?
Who is the King of the North? Is there one? Do biblical and Roman Catholic prophecies for the Great Monarch point to the same leader? Should he be followed? Who will be the King of the North discussed in Daniel 11? Is a nuclear attack prophesied to happen to the English-speaking peoples of the United States, Great Britain, Canada, Australia, and New Zealand? When do the 1335 days, 1290 days, and 1260 days (the time, times, and half a time) of Daniel 12 begin? When does the Bible show that economic collapse will affect the United States? Here is a link to a video titled: The Future King of the North.
The Gospel of the Kingdom of God was the Emphasis of Jesus and the Early Church Did you know that? Do you even know what the gospel of the kingdom is all about? You can also see a YouTube video sermon The Gospel of the Kingdom.
Just What Do You Mean the Kingdom of God? A booklet that was written by Herbert Armstrong answers questions about the Kingdom.
Who is the King of the West? Why is there no End-Time King of the West in Bible Prophecy? Is the United States the King of the West?
Barack Obama, Prophecy, and the Destruction of the United States-Second Edition for Second Obama Term This is a 160 page book for people truly interested in prophecies related to Barack Obama and the United States, including learning about many that have already been fulfilled (which the book documents in detail) and those that will be fulfilled in the future. It also has a chapter about a Republican choice. This book is available to order at www.barackobamaprophecy.com. The physical book can also be purchased at Amazon from the following link: Barack Obama, Prophecy, and the Destruction of the United States: Is Barack Obama Fulfilling Biblical, Islamic Catholic, Kenyan, and other America-Related Prophecies? What About Republican Leaders? Second Edition for Second Obama Term.
Barack Obama, Prophecy, and the Destruction of the United States-Second Term-Amazon Kindle edition. This electronic version is available for only US$2.99. And you do not need an actual Kindle device to read it. Why? Amazon will allow you to download it to almost any device: Please click HERE to download one of Amazon s Free Reader Apps. After you go to for your free Kindle reader and then go to Barack Obama, Prophecy, and the Destruction of the United States-Second Term-Amazon Kindle edition.