A Biblical View of What is Happening to Gold :: by Wilfred Hahn

Like most worldly perspectives, opinions about the role of gold today are in conflict with what the Bible says. Just what role(s) does Scripture outline for gold? As we will briefly lay out, there are least five distinct phases mentioned for gold, each being linked to a different dispensation.

Mostly, however, we want to focus on the current developments involving the price and functions of gold.

As we have pointed out in other articles (for example, please see the Signs of the Times column in this issue of EVR), we know that a “corrosion of gold” (James 5:3) will manifest in the last days. We concluded that indeed, the corrosion of gold and silver has already been underway for quite some time (at least two centuries or more), pretty much in an inverse relationship to the rise of a globalized central banking system.

Without question, the precious metals of gold and silver have played special and vital roles throughout human history. Not only did these metals prove to be fairly reliable stores of savings and wealth, they also frequently had a monetary function. Along with some secondary metals, they served as the intrinsic value for money or as a guarantee for other types of currency, especially paper currency.

Gold (less so silver) was an ideal candidate for this anchor role for money. Besides being an attractive and lustrous material, it was a substance that did not corrode and was easily divisible, transportable, and above all, sufficiently rare. It could not be produced in unlimited quantities as could paper or other kinds of currency. Its supply was limited by the pace and costs of mining production. And so, for several millennia at least, gold served as an effective limit to fiat money creation (fiat  meaning “declared” forms of money like paper bills, for example, without any direct support of real wealth).

Gold has played some form of monetary role right up to the middle of the 20th century. Vestiges of this “moneyness” still linger, particularly so in the minds of historians. Since gold played such a major role in maintaining money systems throughout past history, they reason that today’s paper money systems must eventually return to a gold standard. “Gold is money” is a common refrain. That may well prove true again someday, but not in this current age. We will explain why.

The sudden advent of an integrated, closed, global financial system is a most pivotal development. Consider that as late as the year 1900, there were only 18 central banks in the world. At the time, all of these were located in Europe with the single exception being the Bank of Japan. The prosperity gospel of central banking had not yet spread very far.

However, it did not take long for it to spread far and wide after the Great Depression period. By 1980, over 100 or so were in operation. After the rapid spread of globalization (1970s to 2000 period) over 170 were in operation. And increasingly, these banks (starting with the major OECD country members) began to coordinate their policies. Even former and presently Communist countries followed suit. Consider that China’s central bank is today the second largest in the world! Today, we observe a highly integrated and globalized central banking system in the world.

But just what made the central banking system (itself largely based on debt assets and fractional reserve banking theory) become so endemic? This is because it allowed the flexibility for man-based institutions to manipulate the affairs of wealth accretion … to escape the chains of discipline and natural laws.

All central banks have adopted the same basic operating policies. For example, it is claimed that central banks can regulate the ebb and flow of inflation as well as debt growth in the commercial banking system. They do so through various means (or so they may believe), the details of which we will spare the reader. Some central banks may be more constrained than others due to different country statutes and laws.

All central banks have one most-powerful ability. Technically, they can “create” money out of thin air. Think about this for a moment: You the reader, and this writer, can only accumulate money through earnings and investment gains. We cannot lawfully create money, perhaps by adding zeros to our bank account or printing counterfeit notes. However, a central bank can effectively redistribute the existing savings of an entire country (and, we should add, this can also be done to the whole world) by creating more money with pen strokes. They alone have the franchise to do so.

Readers must realize that the world’s policymakers do not want gold to have a money role, nor do they want it to operate as a reliable hedge against inflation and/or the debasement of money. Remember what’s different today. Political Economy — around the world — is unanimously supportive of the world’s central banking systems. Money is the domain of Political Economy. Money is what it is decreed to be, no matter what its intrinsic value might be. Therefore, this is a fact that must not be ignored or forgotten: The value and role of gold is entirely in the hands of Political Economy.

If gold or some other medium of exchange rises up as a challenge or alternative to the current fiat money system, it cannot be tolerated. Eventually, it will be outlawed. There is no reason why this cannot happen to gold. It has happened before. Therefore, while gold may be an attractive investment from time to time, the globalized monetary system, fraudulent and fiat as it may be, does have sufficient power to disenfranchise gold as a money form at least until late in the Tribulation period. At that point, the entire global financial system collapses.

In the meantime, the leaders of the world do not want to have standards or shackles of any kind constraining their plans and conspiracies, whether morally or otherwise. If the Bible should say that, “The kings of the earth rise up and the rulers band together against the Lord and against his anointed, saying, ‘Let us break their chains and throw off their shackles’” (Psalm 2:2-3), then debasing money and defrauding citizens of their wealth is really only a small thing to them. Such actions, according to the Bible’s definition, are most certainly considered immoral. (Please see the 2-part series entitled Shamans Shamed: A Lost World of Political Economy – Part I and II.)

We already live in a day where it is impossible to live outside of a banking system. We must repeat this as some still do not realize this: It is impossible to survive outside of the banking system. Without belaboring the point further, we point out that with the advent of Anti-Money Laundering laws, access to a bank account is essential. Without a bank account (whatever its future form) you will not be able to buy or sell. You cannot participate in any type of sanctioned commerce.

Political Economy demands that the financial system must preserve itself. Actions such as these fall into the amoral world of Political Economy. And, morality is not a concept that holds any influence over the accepted rules of play in geopolitics. Today, policymakers primarily only represent a world of materialism and its most powerful constituencies. Therefore, a monetary role for gold or silver could not be tolerated. A number of scriptures align with this view. For one, the Bible tells us that the world will be marked by great deception and materialistic idolatry. A monetary “sentinel” like gold would be highly inconvenient during this time for this and other reasons.

The reality is that gold remains a basic, physical element found upon earth. It is not something with eternal qualities or with Biblical certification of real wealth. A study of the role of gold in the monetary systems of the past few hundred years reveals that its reputation as a reliable and solid foundation for security is certainly overstated.

As already pointed out, gold lost its official monetary function some time ago, though many may not realize this fact. It is no longer money (although they are a few places where this is still the case, such as Turkey). The boom in paper money this past century has far outstripped the new supply of gold.

More recently — over the past three decades or so — the value of gold holdings of the world’s central banks has been in a steep decline viewed relative to total stated value of outstanding paper money. In our view, this is the “corrosion” of gold underway that James prophesied about.

The historical role of gold and silver has been turned upon its head. Even if it were possible to return to a monetary system based on gold, as some gold proponents advocate, this would hardly solve the world’s economic and financial problems today. When the hearts of the world are swept up into a frenzy of greed and materialism, no system upon earth is beyond corruption. All the same, it remains valid that a lawless monetary environment can occur much more easily without gold or some other precious and relatively rare item serving a governing monetary role.

As already reviewed, the last days will be marked by an enormous heaping up of wealth. Hoarding of any magnitude can only occur during periods of massive wealth transfers — times of rampant deception and theft. This is not to say that some have not become rich honestly. A fiat money system and volatile, manipulated securities markets are instrumental in bringing about such conditions. In order for money of this type to take over, the monetary worth of more timeless things that are in limited quantity like gold and other rarities must be debased or discredited in some way.

Gold in the Bible

Just what does the Bible say about gold today and its past and future roles, especially at the time that Jesus Christ “restore[s] everything” (Mark 9:12, Matthew 9:28, Revelation 21:5). We note five different dispensations (or ages) in which gold serves differing functions. They are as follows: 1. Old Testament times; 2. the Last Days (beginning with the revealing of the Church); 3. the Tribulation “bust” period; 4. the Millennium, and finally; 5. the Eternal Jerusalem.

The Old Testament role was quite straightforward (the one that historians today still remain fixated upon). Gold served as money or an adornment. Corruption certainly existed; for example, people would shave gold coins until the coins were little more than nubs. Despite this, gold remained physical gold and its value was not systematically destroyed nor manipulated through a fiat financial money system.

The next period is the Church Age, or what is called the last days (meaning the time leading to the Rapture and the Tribulation). That is the time in which we live now—the period during which the “spirit of the antichrist” (1 John 4:3) and the Great Deceiver are working furiously. Gold plays a relatively minor part of what becomes a highly sophisticated and advanced Babylonian system. James prophesies about this time: “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). As we have already concluded, this process of “corrosion” is already well advanced if not near complete.

The Bible mentions actions involving gold in the Tribulation period. At that time, gold holdings will be of little help, proving to be a totally ineffectual hedge against a collapsed monetary system. 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). Nevertheless, people will continue to hold on to their materialistic and financial idolatries despite the 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). Materialistic idolatries will continue even though the entire financial system and gold is bust.

What role will gold next have in the Millennial period? According to Scriptures, we do know that gold will continue as a form of wealth. Several prophetic verses mention that wealth at that time will flow to Israel from the rest of the world. “Surely the islands look to me; in the lead are the ships of Tarshish, bringing your sons from afar, with their silver and gold, to the honor of the LORD your God, the Holy One of Israel, for he has endowed you with splendor” (Isaiah 60:9). (See also Isaiah 60:5, 61:6, 66:12). It would not be unwarranted (though difficult to prove conclusively) to expect a money system based on gold during that time. There are a number of other prophetic statements referring to gold; for example, referring to Israel, “Their land also is full of silver and gold, neither is there any end of their treasures; their land is also full of horses, neither is there any end of their chariots” (Isaiah 2:7).

Finally, after the Millennium, the New Holy City Jerusalem will descend to earth (Revelation 21:10). It is a majestic edifice. “The wall was made of jasper, and the city of pure gold, as pure as glass” (Revelation 21:19). “The great street of the city was of pure gold, like transparent glass” (verse 21). We see that gold will be one of its main structural materials. Given the Holy City’s dimensions—for example, 12,000 stadia (1,400 miles) square and tall, its walls 144 cubits thick (over 200 feet)— it will require perhaps more than a thousand times as much gold as exists above ground today. After all, only a little more than 150,000 tons of gold are known to exist at the present time (barely filling an Olympic size swimming pool!).

Points to Ponder

According to New Testament scripture, one thing is more valuable than gold — our faith. “In this you greatly rejoice, though now for a little while you may have had to suffer grief in all kinds of trials. These have come so that your 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). Our faith, evidenced through the “hearing and doing” of the Word and the “fear of the Lord” is utterly precious for eternity.

In Revelation 3:18, the Church in Laodicea is admonished by the Holy Spirit: “I counsel you to buy from me gold refined in the fire, so you can become rich; and white clothes to wear, so you can cover your shameful nakedness; and salve to put on your eyes, so you can see.”

Many theologians believe that the Laodicean church prefigures the Church in the end times. Whether or not this is so, this verse issues an urgent call that our generation must hear. Even while gold may corrode and financial wealth collapse during the end times, no matter what happens, we can have one treasure that will endure to yield great reward — a faith more worthy than gold.