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  1. Here is my guess. Presuming the Church follows standard accounting practices, before 1997 all of the Church's investment income would show up on its income statement, and all of its commercial assets would show up on its balance sheet. Then in 1997 when EPA was formed, the Church donated most of its for-profit assets to what is, from an accounting point of view, a third-party public charity (i.e. EPA). This caused EPA's assets to be off of the Church's balance sheet, and caused EPA's investment income to be off of the Church's income statement. If you then subsequently only let the apostles see the income statement, they will make spending recommendations and decisions about building temples, building chapels, updating BYU facilities, etc. based on the tithing income it sees on the reports it is given and not on the investment income which is on EPA's financial statements rather than the Church's. The end result is that the Presiding Bishopric and First Presidency can use most of the Church's aggregate income to build up the size of its for-profit asset portfolio rather than anything related to religion or charity, without having to explain themselves to the apostles. It brings to mind the story from 2018 when the vice president of Zimbabwe asked Elder Neil L. Andersen if the Church could develop some clean water wells in remote areas of Zimbabwe. Elder Andersen told him: "We want to help in every way we can. We are not a wealthy people but we are good people, and we share what we have." Elder Andersen meets with Zimbabwe's Vice President Mohadi, pledges support (churchofjesuschrist.org) I don't need to explain why Elder Andersen's comments might seem less than truthful to people who are aware of the rainy day fund. But given the fact that Elder Andersen wasn't authorized to know the scope of the Church's wealth and investment income, he probably thought he was telling the truth. If he would have known the true scope of their assets, he could have honestly said, "While our assets aren't unlimited, we do have enough money to dig wells in every village in Zimbabwe that needs one. Just give me the list of the villages that need wells, and we'll make it happen." It seems to me that if the apostles knew the true scope of the Church's resources, they'd be tempted to pledge more to those in need. And maybe that is why they are kept in the dark?
  2. Do you think apostles should be allowed to see complete financial statements? According to the whistleblower report: Boyd K. Packer—when he was next in line to succeed then-President of the COP, Thomas S. Monson—came to Mr. Clarke wanting to know how much Ensign Peak had amassed and the details of its structure. Mr. Clarke told Mr. Packer that he could not share such details. Mr. Packer said, “I think I should know. I’m the most senior Apostle and President of the Quorum of the Twelve Apostles, and I’m a breath away from being the next Prophet. I think I should be prepared.” Mr. Clarke reaffirmed that he had been instructed not to reveal that information to Mr. Packer, who went away perturbed and unsatisfied, as related to the whistleblower by Richard B. Willes, the Head of Fixed Income at EPA at the time. Mr. Packer died before he could join the First Presidency and know the value of EPA. This seem unbelievable, but is corroborated by the Church's Financial Standard #6230, "Accessing and Securing Financial Information", which was revised on June 3, 2013, and signed by Alan L. Bott, Church Controller. Exhibit A of that document shows a grid with 16 types of "Financial Data" and indicates who can see what. According to that document, the Quorum of the Twelve are not authorized to see reports that contain the following: Cash Investment securities Investment properties Other assets Liabilities Net assets Personnel (salary, etc.) See: https://archive.org/details/MormonDocumentsLDSChurchInternalLeaks/25-AccessingAndSecuringFinancialInformation/page/n3/mode/2up
  3. Norway provides full healthcare coverage to millions of people. And generous pension benefits. And disability insurance. And long-term care insurance. Those commitments are extremely valuable and expensive, and having a trillion in assets isn’t very much considering those benefits of Norwegian citizenship. If the Church gave free lifetime health insurance to all members with $0 coinsurance, $0 deductible, and no lifetime maximum, having $200 billion in reserves wouldn’t be that large, either. You have to compare the size of the reserves to the commitment and vision of the respective organizations. Norway provides valuable, expensive benefits. The Church does not.
  4. Great question. 1- Many people with insurance won’t file claims; they’ll have the good fortune of dying without an expensive stint in a nursing home, they’ll surrender their life insurance policy for a cash value much less than the death benefit, etc. 2- Most of the claims on the 4.9 million policies that do occur won’t happen for several years and often decades. This means that the company has a lot of future premiums to further beef up its asset portfolio before the bills are due. 3- Further, the current assets and future premiums will be multiplied by future investment returns before the bills are due. When people wonder how the Church can survive for 50 years with “only” 100 billion in its investment portfolio, I wonder if they are taking future investment returns and future tithing receipts into consideration.
  5. Whether owning farmland is hoarding depends upon the nature of the organization. As another entity to put this in perspective, consider the largest family-owned business in the U.S.: Cargill. Cargill has a staggering $165 billion dollars of annual revenue and 155,000 employees. If I was going to be envious of anybody, I'd be envious of the Cargill family. Be born into that family, and your share of the pie is a passive income starting at birth on the order of a hundred million a year. Anyway, if the Church wants to be the next Cargill, they should knock themselves out. But if this is what they see their mission is, members shouldn't be offended when the Church is called a massive real estate investment trust that happens to have a religious operation on the side. Nor should they object to being taxed that way. I really don't have a problem with anybody wanting to get rich or build business empires. But growing a mega business for the sake of growing a mega business is different than having a prudent rainy-day fund to support a Church's religious mission. Are you conceding that accumulating assets is one of the primary missions of the Church? Does the Church using its money to purchase shares of United Health Group and profit off of the chronic illness of the country do as much good as using its money for charitable purposes? I don't see how. The claim that owning stocks does as much good in the world as giving resources to charity sounds like something Scrooge would say. I may or may not have a personal friend who meets with the presiding bishopric multiple times a week to discuss these things. He may or may not have told me what they grapple with. You probably think I'm completely making up what I'm insinuating here. I'm counting on that. I'm happy you don't believe me. Why would the farmland stop producing food if it were owned by somebody other than the Church? And if the Church's mission is to take over the world's food supply in order to make it more reliable, then why not tell the world about that? Why keep it secret?
  6. Certain is a strong word, and I admit what I said was hyperbolic. To be fair, they are now under intense pressure to stop kicking the can down the road, and they are now planning on ramping up charitable giving. But as we discussed on the other thread, giving away money in a responsible way is hard, and I just don't see them having the guts to ramp it up on a scale comparable to the Bill and Melinda Gates Foundation; doing things that big just isn't in their DNA. But I'd love to be proven wrong.
  7. Yea, insurance nomenclature is extremely unfortunate. But to emphasize the point, the reserves are the liabilities themselves, regardless of whether there is a pile of cash in the wheelbarrow. If we want to be technically correct, somebody might comment about a big pile of cash in the wheelbarrow, and I'd respond, "yes, that is a mighty impressive stack of assets. However, those assets back the reserves for these insurance policies, so we need to handle them carefully with those obligations in mind." These ideas aren't ultimately arbitrary things humans made up. A basic principle of economics is that resources are scarce and that we have to maximize everybody's wellbeing (i.e. their "utility", another unfortunate word, this time from economics) by making tradeoffs. Because of the diminishing marginal value of different things, the way to maximize utility is to make tradeoffs--you don't use all of your resources to produce guns, and you don't use all of your resources to produce butter. Utility will likely be maximized by coming to an optimal balance between the two. This principle applies to risk in a direct way. At some point, stashing away even more money into an already excessive "rainy-day fund" just isn't worth the cost. If you make $100,000 a year after taxes, but live on $40,000 and put the remaining $60,000 into a "rainy-day fund" that already has $10,000,000 in it, it might be worth thinking about whether you should save less so that your kids can finally start taking piano lessons, or save less so you can give more to a worthwhile cause, or save less so you can finally take a vacation, or save less so that you can spend the money on any number of things that would be more worthwhile than hoarding it. No, they are accurate evaluations of the situation by somebody who knows what he is talking about. Actually, I do in fact know that they don't have a vision. Beyond upgrading Salt Lake City with a conference center and a shopping mall, they don't have a driving vision to do anything differently with their money, and don't have the courage to meddle with the tactics N. Eldon Tanner set up 60 years ago. I might know about their lack of vision that because they refuse to articulate it and you can tell by how they operate. And I might know about their lack of vision from insider information I may or may not possess. I can't comment on that. Since you asked, I do in fact have the power of discernment. Their heads are primarily filled with lack of vision, lack of revelation, groupthink, and conservatism morphing into fear. They distract themselves from those things by admiring how big the hoard is. I don't think it makes sense to forecast the next thousand years by looking at the prior thousand years. If something were to happen in the next thousand years that could cause the Church to stop existing, having more shares of Apple, Microsoft, and Amazon won't save it.
  8. I think souls are worth more than the value of EPA's assets. That is why I think people should follow the Church's example and build up their own savings as much as possible.
  9. Just to keep the terminology straight, in insurance parlance NM has $297 billion in reserves and $37 billion in surplus. The Church's "reserves" (i.e. its "rainy-day fund") is functionally equivalent to NM's surplus. In both cases, it is extra money for unforeseen or unlikely emergencies.
  10. In one sense it's conjecture, but in my opinion this is the most reasonable and credible estimate I've seen. We can make intelligent, educated guesses about such things. Whether the actual number is $7 billion or $12 billion has no bearing on my actual point. I presume you are talking about Norway's Sovereign Wealth Fund. When you consider the actual benefits Norwegians get through government benefits that are partially supported by this fund, it really isn't that large. They get fully paid healthcare, fully paid disability insurance, fully paid long-term care insurance, and very generous pensions. I would have no problem with the Church having $x,x00 billion in assets if the Church provided benefits to members or to society that was commensurate with the size of the fund. But they don't. It's the combination of having a ton of money and no plan to use it to provide any value to anybody that conjures up visions of Scrooge McDuck.
  11. I do. I think the takeaway is that we can infer from the Church's actions that the refrain to "Lay not up for yourselves treasures upon earth, where moth and rust and market crashes doth corrupt, and where thieves break through and steal" is no longer applicable in the 21st century, and that prudence dictates that we should all do our best to build up significant savings. I also think an important gospel takeaway is to recognize that since the second commandment was given in the Garden of Eden, commandments have had irreconcilable contradictions and that we need to choose which ones to obey and which ones to break. The Church now asks its members to given 10% of their income to the Church and to have their own prudent savings. For those of us lucky enough to have the financial resources to pay a full tithing and to fully fund retirement accounts and emergency funds, good for us! For the rest of us, we should follow the Church's example and make personal savings our top priority, even if it means not paying tithing.
  12. Your gift of discernment is malfunctioning. Are there any unresolved sins in your past or current bad habits that you need to clear up with your bishop? You've completely missed the point. In terms of "money management principles," the Church's approach to capital allocation reflects best practices. I've never denied that, but that has nothing to do with any point I've ever made. Where the Church fails in having any type of vision or strategy for what to do with its money. It uses most of its income to purchase income-producing assets. It does this because it has no vision of doing something better with the money. What real-world benefit does the Church get for this? Nothing, beyond the thrill of having it. Hamba Tuhan gets that thrill, and I suspect that at least a few people in the Church hierarchy do as well. It's that attitude of accumulating wealth for no purpose other than having it that I compare to Scrooge McDuck. I think you are misunderstanding NM's balance sheet. From a simplistic perspective, NM has about $335 billion in assets, 4.9 million insurance contracts it is legally obligated to honor, and zero in debt. The questions insurers face regarding this include: How much of the $335 billion must be set aside to pay for future claims? How much of the $335 billion should be set aside for a "rainy day fund" so that the company can weather great depressions, world wars, etc. How should all of that be reflected on the company's balance sheet? Given its contractual obligations, is $335 billion enough to even be considered solvent? Here are the answers: NM's actuaries have determined that the answer to question #1 is $297 billion. This doesn't mean that it thinks it will only pay $297 billion on claims for its 4.9 million policies--it will certainly pay much more than that. What it means is that $297 billion, plus future premiums on the policies that remain in force, plus investment income, will be enough to pay claims under moderately adverse conditions. They decided that they need $37 billion in additional assets for a "rainy day fund" so they can withstand they types of events it has survived in the past: great depressions, world wars, financial crises, etc. The $297 billion it needs to set aside to pay future claims are a liability on its balance sheet (and bear the unfortunate name "reserves"--reserves conjures up a vision of money that is set aside. But in insurance accounting, reserves are a liability, not an asset). The remaining assets (i.e. the rainy day fund) are called "surplus" in insurance accounting, and is functionally equivalent to "owners equity" in basic accounting. If the actual market value of the company's assets is greater than $297 billion, the company is solvent. If the market value of assets is less than $297 billion, the company is insolvent. Regulators require a minimum level of surplus beyond the reserves, and strong companies such as NM hold several times the minimum required capital. Is he simply talking about the tradeoffs between financing companies by issuing equity vs. issuing debt, and how owners can increase their expected returns if the company is leveraged with debt? One quibble here. Its primary job is to take on risk, not merely predict it. Depending upon what a company does, it will need a lot of money to get into business. A manufacture can't get going without purchasing raw materials and factories. Airlines can't get going without first having planes. For insurance companies, it can't get going unless it already has sufficient assets to fund its initial surplus. Initially, the money comes from either issuing equity or issuing debt. Its equity can then grow by retaining profits or by issuing more equity or by issuing more debt. There are tradeoffs between debt and equity. If the current owners are bullish about their company's prospects, they won't want to dilute their ownership stake by issuing more equity, so if they need money they'd prefer to issue debt. If they issue debt, they have to pay back the loan with a fixed amount of interest, but they get unlimited upside on the profits that they anticipate the loan will allow them to achieve. The big event I'm referring to is in 1963 when N. Eldon Tanner was called to the First Presidency and implemented the Church's current discipline of forecasting the next year's tithing, and then limiting expenses to 90% of that. The Church's ethos of never taking on debt, living on less then its annual tithing revenue, and investing the balance "for a rainy day" began in 1963. The truth is the Church needed higher reserves back then, and this was a solid, professional way to build up the reserves to a prudent level. The problem is that once the reserves became too high (and yes, that is a thing), it failed to make a course correction. The Church was running on a deficit for multiple years up until 1963 when Tanner took the reins. Ten billion in reserves is a solid number that would ensure the Church, if properly run, could thrive for a thousand years.
  13. If the Church's ultimate objective is to acquire all of the world's material wealth... ...then it should pay taxes on its income like any other corporation that is in the business of acquiring material wealth. It seems there are two basic responses to my thoughts on the topic: The Church isn't motivated by the desire to accumulate wealth--it's just competently practicing "good wealth management." Yes, the Church is in the business of expanding its business empire until it eventually owns the world. Isn't that wonderful!
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