Authoritative and Familiar

By Doug Cook

I watched a movie recently that was a true story about the 2008 financial crisis.  I will not name the movie as it was rated R due to the atrocious language used and a few scenes in a stripper club which was just being true to life of where the Wall Street boys hang out and the language they use to express themselves. I normally will not watch R rated movies, but was given prior knowledge of some of the insights on the fraud this movie exposed.  So I watched it and, even though some “Christians” will judge me anyway, I ignored the bad stuff and focused on the revelatory aspects of the film. 

The picture was almost like a documentary on an insider’s look at what actually happened to create this worldwide crisis and collapse the markets of many nations around the world.  The big banks were creating bonds made from thousands of home mortgages put together in MBS’s (mortgage backed security bonds) and then these bonds were packaged together in CDO’s (collateralized debt obligations) and allowed multiple side bets on these packages.  They made deals with the rating agencies to rate these CDO’s as triple A yet they packaged these CDO’s with a few triple A mortgages, but most of the mortgages in these bonds were sub-prime loans rated at triple B to junk and doomed to failure which in turn would cause the Triple A rated CDO containing these bonds to fail.  Most all of the Wall Street boys were talking CDO’s but hardly any of them actually read the prospectus of what was in them or really understood what they were or how they worked as they were making money on buying and selling them so that’s all they cared about.  I know I heard these terms in the news many times back in 2007 and, even though I had done some investing myself, had no idea what they were talking about so I stayed away from them.  The big banks created them to be confusing so most people wouldn’t understand the underlying trading game they were playing on an unsuspecting public.

The film’s focus was on four authentic traders at the time that actually figured out what was going on, and the fraud the to-big-to-fail banks were perpetrating on the American people as early as the fall of 2005, and began shorting (profiting from failure of stocks or bonds called “credit default swaps”) the mortgage bonds.  After being scorned and ridiculed for telling the truth for about two years these guys ended up making a few billion dollars for the investors in their hedge funds while other hedge funds went bankrupt when the mortgage bonds and the economy finally did collapse.  When all the dust had settled, over 5 trillion dollars in pension money, real estate value, 401K, savings and bonds had disappeared.  8 million people lost their jobs and 6 million lost their homes and that is just in the United States.  All this was caused by the big banks, rating agencies and people in the government deceiving the markets with fraudulent products designed to make big profits for the to-big-to-fail banks which in the end were bailed out by the government when they themselves failed.  So it was the average American taxpayer who lost all this money and then had to bail out the very banks that defrauded them.

The person who made the most profit for his hedge fund was Michael Burry.  His fund had approximately 555 million dollars in deposits from clients.  In 2005 he studied some of the prospectuses of some of the CDO’s and discovered how many non-performing junk rated mortgages were packed in these bonds and realized that eventually they had to fail.  Against the desires of his clients in mid 2005 he began shorting these bonds so his fund could profit from their eventual collapse.  He was looked upon as a lunatic and out of his mind by most of the people closest to him he respected because they couldn’t believe the truth.  Over the course of the next two years before the collapse he had to pay out over 100 million dollars out of his fund to maintain his short positions. This caused his fund to show a loss in profits for those two years and most of his clients turned against him and a few sued him, but he wouldn’t waver because he knew the bonds would eventually fail.  In 2008 when the CDO’s and economy failed he closed out his short positions and ended up making 2.69 billion dollars profit and a 489% gain for all the clients in his hedge fund.  However, because of all the ill feelings of his clients and damage to relationships he decided to close down his hedge fund.  The last e-mail he sent to all his clients informing them of the decision to close the fund stated, “Making money is not like I thought it would be.  This business kills the part of life that is essential, the part that has nothing to do with business.  All the people I respected won’t talk to me any more except through lawyers.  People want an authority to tell them how to value things but they choose this authority not based on facts or results. They choose it because it seems authoritative and familiar and I’m not and never have been familiar.”  He realized the fact that most people can’t deal with truth and have a very hard time stepping outside their comfort zone no matter how much profit there is in doing so.

“Truth is like poetry and most people hate poetry.”

The last person I will mention from the movie and real life is Mark Baum.  He was head of a smaller hedge fund and found out from a wrong phone number received at his office that a few investors were shorting the CDO’s.  Being a person from his childhood who would not believe anything from anyone unless he could prove it to himself, he began researching the mortgage bonds and eventually discovered for himself how corrupt the mortgage bonds were and how much fraud and deception was going on from the big banks and decided to invest in short positions for his own fund.  From his 50 million dollar short investment he made almost 1 billion dollars profit for his fund when the economy collapsed.  When Mark had made the investment and before the collapse he spoke at an investor meeting.  He was so incensed over the corruption he had discovered in the system he made this statement, “We live in an era of fraud in America not just in banking, but in government, education, religion, food, even baseball.  What bothers me isn’t that fraud is not nice or that fraud is mean, it’s that for 15,000 years fraud and short sided thinking have never, ever worked.  Not once.  Eventually it’ll get caught and things go south.  When did we forget all that?  I thought we were better than this, I really did, and the fact that we’re not doesn’t make me feel all right and superior, it makes me feel sad.  I just know that at the end of the day, average people are going to be the ones that are going to have to pay for all this because they always, always do.”  This was the most insightful statement in the movie that was actually delivered in real life and what inspired my critique.

In Mark’s statement he mentioned everywhere he discovered fraud in his life.  He expanded on all the fraud in banking and government and I think we all could expand on the fraud in food with all the GMO and preservatives used today.  As a boy he was enrolled in a Jewish school and the Rabbis noticed he was a very studious child in the Talmud, not because he wanted to learn but because he was trying to find out whether they were teaching him truth or untruths.  So Mark’s statement was from years of experience and the part that really peaked my interest was the statement about fraud in religion.  After considering his statement I had to agree with him in that big religions are as fraudulent in the area of religious “markets” as the big banks are in the financial markets.  We do live in an era of fraud and I would like to expound on the fraud in religion.

Religious Fraud

To begin with, Michael Burry’s statement very much applies to most people in every circumstance especially religion.  “People want an authority to tell them how to value things but they choose this authority not based on facts or results. They choose it because it seems authoritative and familiar…”  The populace will naturally form attachments to someone or some assemblage who has leadership abilities and gives the impression of knowing what they are talking about, yet have not strayed too far from the recognizable traditions and attitudes they have grown up with (the familiar).  Most of them are like sheep.  A good number are followers and they are like herd animals always following the pack.  They won’t admit it but they choose someone they perceive to be an authority to make their decisions for them, thereby, in their own mind, absolving themselves of any responsibility if anything goes wrong evidenced by the mass of humanity perpetually attempting to blame someone else for their own predicaments and deficiencies they find themselves entangled in. 

For most pious people adhering to the familiar is the easy way out because the majority is too slothful to take the high road and take full responsibility for their own decisions and lifestyles.  They want to stay in “the familiar” since it’s comfortable to them and keeps them from having to contend with their fear of the unknown.  It also guards them from the fear of discovering how far from God’s truth their religions and denominations in Christendom have become that they have been practicing and have been passed down to them from previous generations through family bloodlines.  Just like the financial markets of 2008, these different “triple A rated” religions and denominations contain some “triple A rated” truth but are also packed with “sub-prime” fraud and deception that will eventually fail in the end, yet most choose to turn a blind eye to these errors because deliberately dissecting these religions and denominations in an attempt to discover some existence of error would involve stepping outside their comfort zones (the familiar).  Just like the deceived financial investors, hardly any of them actually “read the prospectus” (in dept study) of what is in these religions and denominations or really understand what they are or how they work.  And when anyone decides to follow the truth based on biblical facts and results (not familiar religious practices and man-made rules) God guarantees us persecution (Yea, and all that will live godly in Christ Jesus shall suffer persecution.) and like Michael Burry discovered, the cost of relationships is enormous and it comes from the people you most respected who will no longer talk to you.  The herd of submissive sheep you were a part of will reject you along with your own blood family.  Yet Jesus tells us this is the price His sheep need to pay, “If any man come to me, and hate not his father, and mother, and wife, and children, and brethren, and sisters, yea, and his own life also, he cannot be my disciple.”  So, if you posses any minuscule desire to be truly honest about your beliefs, evaluate these very simple truths and see if your religious decisions are based on true facts or the familiar fraud.  If you’re not being despised and rejected by your own family and those in your sacred affiliation, you’re still very much entrenched in the deceived and are so blind to this truth it will sound like foolishness to you so you won’t be able to receive it.  “But the natural man receiveth not the things of the Spirit of God: for they are foolishness unto him: neither can he know them, because they are spiritually discerned.”

Because the preponderance of pious people follows the familiar it’s seemingly a very lonely lifestyle to pursue truths based on facts and results.  Yet the reality is the closer you get to the real truth, Christ, the less dependence we have on the desperate need for others to fill the voids in our hearts from loss of relationships.

Jesus himself said, “Many are called but few are chosen.” He also told us, “Enter ye in at the strait gate: for wide is the gate, and broad is the way, that leadeth to destruction, and many there be which go in thereat:  Because strait is the gate, and narrow is the way, which leadeth unto life, and few there be that find it.”  Not many of those that essentially have an ongoing personal relationship with Jesus Christ have a full comprehension how infinitesimal the number “few” really is.  Those that have grasped the truth of the number can attend any spiritual meeting anywhere, including their favorite denomination, and recognize that out of all the devout pious people practicing their religion in the meeting there will be at most ten to twenty percent that are of the “few,” including those in leadership.  The remainder of those in attendance are living in religious fraud and deception.  If you’re one of those hordes that believe that most of those in your denomination are of the “few,” you are deceived, living in fraud, blinded by your pride and I pray God open your eyes to the truth because you have rejected His truth.   And like Mark Baum in the 2008 financial crisis found out, even though the “few” are going to profit tremendously in the Kingdom of heaven, it doesn’t make us feel right or superior; it makes us feel very, very sad even to the point of tears.  We know that at the end of it all, average religious people are going to have to pay a terrible price because “they always, always do.”  Even though the profit for the “few” who know the truth will be immeasurable, the vast number of the religious denominational herds “after their own lusts shall they heap to themselves (authoritative) teachers, having itching ears;” that con them into believing they will profit just as much remaining in their comfort zones of their familiar religions and man-made rules, “And they shall turn away their ears from the truth, and shall be turned unto fables.”

All religions weaving their webs of fraud is a long slow gradual process which makes the transition from any form of relationship with Christ to practicing a familiar fabled religion scarcely noticeable, “giving heed to seducing spirits, and doctrines of devils;” they eventually depart so far from the truth “God gives them over to a reprobate mind” rendering them incapable of ever returning to a true relationship with Christ again.  Trying to reach any of these holy sounding religious reprobates is an effort in futility, like casting pearls before swine.  We can only reject God’s truths so many times before He will eventually say, “because thou hast rejected knowledge, I will also reject thee, that thou shalt be no priest to me.”

For 6000 years religious short sided thinking and denominational fraud have never, ever worked, not once.  When did God’s people forget all that?   The only thing “Christians” learn from history is that Christians never learn from history!  “There is no remembrance of former things.” And similar to Mark Baum, for years after receiving Christ, I thought we were better than this, I really did, but we’re not and this doesn’t make me feel right and superior it makes me feel very sad, because in the end it’s the average believer that is going to have to pay a great eternal cost for their belief in the fraudulent religions.  ”My people are destroyed for lack of knowledge: because thou hast rejected knowledge,” not because it was never given to them.  And just like the crash of 2008 destroyed millions of deceived people’s lives, the coming religious market crash will destroy millions of deceived denominational religious people’s eternal lives.

Relating to what Michael Burry stated, this religious business kills the part of life that is essential, the part that has nothing to do with the business of religion.

Wherefore come out from among the authoritative and familiar, and be ye separate, says the Lord, and touch not the unclean religions and factious denominations; and I will receive you.

Your Servant in Christ.