When the Global Economy Gets the Flu…

(Note to readers: This testimony was written before the lockdown occurred)

In light of the current threat and the potential consequences of the corona virus, I was asked to share my story about the effects of the recession in 2008.

The 2008 financial crisis started as a result of a sub-prime mortgage crisis which had to do with irresponsible lending by banks in the USA. We are part of a global financial market. If one market gets the flu, the repercussions are felt throughout the world. Banks throughout the world started looking at their lending criteria which led to various other issues and the financial pressure was on.

How did it affect Rustenburg? (the town where I live). Rustenburg, South Africa, is considered to be the platinum mining capital of the world. On 28 July 2008 Platinum was soaring at an all-time high of $1992 per ounce and by 25 October 2008 it was down to $813 per ounce. Capital expansion projects on the mines were cancelled and Rustenburg got the flu.

How did it affect my business? My monthly turnover became my annual turnover and the fight for survival was on. In an attempt to keep the business, my personal debt sky rocketed totally out of proportion. We found ourselves at the bottom of a very deep pit. It was a long gradual recovery after that with many ups and downs and many testimonies, but God was faithful. He was faithful then, He will be faithful again.

March 2020.
So, we stand now with a different crisis and the markets have the flu again. In the past month we have seen the price of Platinum drop from $1009 per ounce to $627 per ounce. Global markets have been crazy. Most mine share prices have dropped by 50% or more in the last month.

How are things different this time around with a physical Virus?
Social media has boomed since then and everyone has an opinion regarding everything. We see this creating panic and people lending their ears to all sorts of unsubstantiated media. Can we ignore the threat, of course not. Practice social distancing, wash your hands etc. buy hand sanitizer if you can find and do what is needed. Don’t get involved in the panic but rather hold on to the One who offers peace that surpasses all understanding.

One of my favourite passages is Psalm 23: 2 “He leads me beside still waters.” We can be calm in the midst of the crazy. Psalm 23:4 “Even though I walk through the valley of the shadow of death, I will fear no evil, for you are with me; your rod and your staff, they comfort me.” He is with us and we need not fear, He is the good shepherd. Furthermore, as Christian believers, we are called to be “…. the light of the world. A city set on a hill cannot be hidden.” (Matt 5:14.) We should not be spreading panic nor fear but rather be the hope and assurance that others are looking for.

So what Financial lessons did I learn from 2008 that I think are relevant to us today.
Be frugal (matig; sober; spaarsaam) with your personal and business finance. For those in business, the recovery could be slow and gradual. Interrogate all your expenses in this season. Cut out any excess and rather save for a bit later.

Be transparent with friends and your connect group. The value of church friends during the 2008 financial crunch was invaluable. I had a close friend who called me daily to check up on me. It was so helpful as the struggle was not only financial but became an internal struggle which led to a diagnosis of depression. I had depression which I had never quite believed in before. We are here for each other so don’t isolate yourself. Seek out the ones who are struggling and be the friend that I had and still do have.

With financial matters seek advice. Prov 15:22. “Without counsel, plans go awry, but in the multitude of counsellors they are established.”

Pursue Him more in this season, pray more, fill yourself with the Word and reach out to others around you. Taking time to spend with those less fortunate than you is an antidote for this season.

Let’s be the church.

Love you all.
Ian

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