The World's Ruined: A disturbance in the land of Goldilocks...

Thursday, August 9, 2007

A disturbance in the land of Goldilocks...

What a bear... things are starting to get real nasty as the troubles in the mortgage sectors have now moved up the food chain from the sub-prime lenders to United States' largest mortgage company. The Dow down almost 400 points. After several years of unprecedented easy credit and lowering of credit standards, the chickens coming home to roost... or is that "bears" coming home for a visit?

Countrywide is down about 12% so far in after hours trading.

From the Wall Street Journal:
Countrywide Hit by Credit Market Woes
By JAMES R. HAGERTY
August 9, 2007 7:31 p.m.

Countrywide Financial Corp. faces "unprecedented disruptions" in debt and mortgage-finance markets that could hurt earnings and the company's financial condition, the Calabasas, Calif., lender said in a regulatory filing. (Read the SEC filing)

The company, the largest U.S. home mortgage lender in terms of loan volume, said reduced demand from investors is prompting it to retain more of its loans rather than selling them. The company also has been shoring up its finances. "While we believe we have adequate funding liquidity," it said in a quarterly filing with the Securities and Exchange Commission, "the situation is rapidly evolving and the impact on the company is unknown."

And from Bloomberg.com:
The ECB said today it provided the largest amount ever in a single so-called “fine-tuning” operation, exceeding the 69.3 billion euros given on Sept. 12, 2001, the day after the terror attacks on New York.

“This is an old-fashioned credit crunch,” Chris Low, the chief economist at FTN Financial in New York, said in a report today. “This is not a small thing. A credit crunch, when the short-term credit markets seize up, is extraordinarily serious, almost always the precursor of a significant recession.”

“Somewhere out there, there are several people that are in trouble — it’s hard to put your finger on it,” said Andrew Busch, global foreign-exchange strategist at BMO Capital Markets in Chicago. “I cannot name names. We know BNP has issues with three funds. But you do not see a movement in overnight rates like that unless there is a huge concern about liquidity and funding.” Full article HERE.

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The Mere Mercy of God

This calling of Abram is a signal instance of the gratuitous mercy of God. Had Abram been beforehand with God by any merit of works? Had Abram come to him, or conciliated his favour? Nay, we must ever recall to mind that he was plunged in the filth of idolatry; and God freely stretches forth his hand to bring back the wanderer. He deigns to open his sacred mouth, that he may show to one, deceived by Satan's wiles, the way of salvation.

But this is done designedly, in order that the manifestation of the grace of God might become the more conspicuous in his person. For he is an example of the vocation of us all; for in him we perceive, that, by the mere mercy of God, those things that are not are raised from nothing, in order that they may begin to be something.

-John Calvin, Genesis, (Banner of Truth), p. 343

"Nor the faith also does not shut out the justice of our good works, necessarily to be done afterwards of duty towards GOD (for we are most bounden to serve GOD, in doing good deeds, commanded by him in his holy Scripture, all the days of our life): But it excludes them, so that we may not do them to this intent, to be made good by doing of them. For all the good works that we can do, be imperfect, and therefore not able to deserve our justification: but our justification doth come freely by the mere mercy of God..." (Thomas Cranmer - Homily of Justification)

Justification-Sanctification/Law-Gospel

In short, I affirm, that not by our own merit but by faith alone, are both our persons and works justified; and that the justification of works depends on the justification of the person, as the effect on the cause. (John Calvin, Acts of the Council of Trent with the Antidote)

The law guides, directs, commands, all things that are against the interest and rule of sin. It judgeth and condemneth both the things that promote it and the persons that do them; it frightens and terrifies the consciences of those who are under its dominion. But if you shall say unto it, “What then shall we do? this tyrant, this enemy, is too hard for us. What aid and assistance against it will you afford unto us? what power will you communicate unto its destruction?” Here the law is utterly silent, or says that nothing of this nature is committed unto it of God: nay, the strength it hath it gives unto sin for the condemnation of the sinner: “The strength of sin is the law.” But the gospel, or the grace of it, is the means and instrument of God for the communication of internal spiritual strength unto believers. By it do they receive supplies of the Spirit or aids of grace for the subduing of sin and the destruction of its dominion… (John Owen, A Treatise of the Dominion of Sin and Grace)

Thursday, August 9, 2007

A disturbance in the land of Goldilocks...

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