The Church has $32 Billion in the Stock Market

[Bernard Gui]

1 minute ago, HappyJackWagon said:

Does it make you wonder how much money the church lost in the 2008 stock market? Would it shock/disturb you if you found out the church lost $50 million dollars in the stock market over the course of a couple of years? Who would be to blame? No one, because you'd never know about it.

I don't know how much the church lost in 2008 but I bet it was substantial. I wonder if the church has recouped all of its losses in the past decade or if that $32 billion is still down from what it once was.

Just like all the rest of us, no?

[Bernard Gui]

29 minutes ago, JLHPROF said:

As long as the Church is following God's will and correct principles those complaining really don't have a leg to stand on.

There have been questionable financial decisions in Church history but again most of them fell outside the stewardship of the general membership.

I think we have learned from the past and are trying not to make the same mistakes.

[smac97]

5 minutes ago, Analytics said:

You missed the point, Scott. If taxes are in fact a something we legitimately owe our government in order to fund the services it provides and are not a form of theft, and if a dollar equals a dollar, then tax breaks are a form of subsidization.

Do you take advantage of any "tax breaks?"  Anything in the tax code that allows you to pay fewer taxes than you otherwise would?  Pretty much very individual and organization does, which means that pretty much every individual and organization is - by your reckoning - being "subsidized."

So do you publicly fault every individual and organization who are so "subsidized?"  Or is it just the LDS Church that is to be faulted in this way.

5 minutes ago, Analytics said:

That is my only point in what you just quoted. Whether charities, children, or churches ought to be subsidized is another issue that I didn't address.

And individuals, and pretty much every organization in the U.S.  We all use the tax code to reduce our tax obligation.  We all are "subsidized."

5 minutes ago, Analytics said:

Yes, there are arguments about why churches ought to be subsidized through tax policy. Just because you think a subsidy is a good investment doesn't mean it isn't a subsidy.

But your reckoning doesn't apply to just churches.  It applies to everybody.  So you seem to be singling out the LDS Church for behavior that all of us do (use the tax code to minimize tax obligations).  Am I wrong?

Thanks,

-Smac

[ksfisher]

1 minute ago, HappyJackWagon said:

Does it make you wonder how much money the church lost in the 2008 stock market? Would it shock/disturb you if you found out the church lost $50 million dollars in the stock market over the course of a couple of years? Who would be to blame? No one, because you'd never know about it.

I don't know how much the church lost in 2008 but I bet it was substantial. I wonder if the church has recouped all of its losses in the past decade or if that $32 billion is still down from what it once was.

When the market goes down why would one not expect the church's investments to go down as well?  The church may have a sound investment strategy, but I would not expect it to be full proof. 

[smac97]

3 minutes ago, JLHPROF said:

The parallel is definitely fascinating.

Hey, I think participants on this board have a "right to know."

😀

-Smac

[Analytics]

2 hours ago, Stargazer said:

I don't think I would attempt to estimate the value of all the land and physical plant that the church possesses, but I'd bet that it was more than what is in the stock market.  However, as you well know, the value of a given asset only becomes a reality when it is sold. Until that time such things as real estate and physical plant is going to cost money.  The upkeep is not negligible. 

Not to quibble, but it depends on the asset. A meetinghouse could be considered a money costing asset rather than a money generating asset, but on the other hand before you can fill a meetinghouse with tithe payers, you need to build it first. The ROI on such an investment could be calculated, and I'd be surprised if it isn't.

I would speculate most of the stocks the church purchases pay dividends. So these have a realized value even when not sold. The millions of acres of farm and ranch land are the same thing--profit generators even if not sold.

[Scott Lloyd]

15 minutes ago, smac97 said:

Well, it's not like we haven't seen this implication before:

In the other narratives of this story, in Matthew 26 and Mark 14, we get even more informatin, with Judas (and apparently others) felt "indignation" within themselves and criticized the use of the ointment as "waste."

So we have a thief feigning righteous indignation to second-guess and find fault with the utilization of sacred funds.

A thief presuming, in bad faith, to dictate matters not within his stewardship.

A thief who thinks that his access to the contents of "the bag" entitles him to override and criticize the stewardship of those who have the responsibility to administer it.

I'm not sure there is wisdom in taking lessons in morality from a thief.

-Smac

 

8 minutes ago, JLHPROF said:

The parallel is definitely fascinating.

And instructive when applied to modern day. 

[HappyJackWagon]

6 minutes ago, Bernard Gui said:

Just like all the rest of us, no?

So it wouldn't bother you if a substantial $$$$ of consecrated tithing funds were lost in the stock market? I find that to be a very strange position.

The process of investing $$ so that they (and the interest) can be used at a later date reflects an opportunity cost. For example, the church doesn't build a temple or donate to a charity today, with the hope that it will be able to grow the dollars and build more temples and donate more to charity in the future. If those tithing funds are lost, then it would appear the opportunity cost was too high and it would have been better to build the temple and make the donation today.

[bluebell]

15 minutes ago, HappyJackWagon said:

Does it make you wonder how much money the church lost in the 2008 stock market? Would it shock/disturb you if you found out the church lost $50 million dollars in the stock market over the course of a couple of years? Who would be to blame? No one, because you'd never know about it.

I don't know how much the church lost in 2008 but I bet it was substantial. I wonder if the church has recouped all of its losses in the past decade or if that $32 billion is still down from what it once was.

It wouldn't bother me.  I feel like the scriptures (specifically the one about the talents) are clear that we can't use the presence of risk as a reason not to work within our stewardship to increase the blessings God gives us to work with.  He expects us to take the risk and do our best.

If those in charge of the church's finances are truly doing their best (given the education and information they are working with) then from my perspective no one is to blame if money is lost in a recession.  

I think the bolded question is interesting though because it does show that money in the stock market doesn't necessarily represent actual money until the stock is sold.  Like many homeowners learned when the housing market crumbled, it only matters if you were upside down on your mortgage if you are trying to sell.   If you weren't, then it didn't matter what your house was currently worth. 

 

[Amulek]

2 hours ago, rockpond said:

Not sure why that is relevant.  I certainly don't want the Brethren making financial decisions based on what would make me happy.

Perhaps I inferred something that you didn't mean to imply then.

When you said, "$40 million per year donated to humanitarian aid represents just 2% of only the income produced by the Church's stock market holdings," I took that to mean you thought the 2% figure was too low. 

If that isn't correct, I apologize. 

 

[Analytics]

7 minutes ago, smac97 said:

Do you take advantage of any "tax breaks?"  Anything in the tax code that allows you to pay fewer taxes than you otherwise would? 

Yes, yes.

 

7 minutes ago, smac97 said:

So do you publicly fault every individual and organization who are so "subsidized?"  Or is it just the LDS Church that is to be faulted in this way.

I don't fault any organization or activity for being subsidized, including the LDS Church. All I'm doing is taking a clear-headed approach and calling a subsidy what it is. There is nothing wrong with taking a tax break, but as citizens, we ought to recognize what they are.

 

7 minutes ago, smac97 said:

And individuals, and pretty much every organization in the U.S.  We all use the tax code to reduce our tax obligation.  We all are "subsidized."

My point is to look at the implications of the tax code with a clear head. It is clearer to say, "the interest I pay on my mortgage is subsidized" than it is to say, I am subsidized. As a society, do we want to subsidize the interest on home loans? Why do we want to subsidize this type of debt? Those are fair and important questions to ask. But if somebody tries to argue that home interest deductions aren't a subsidy, they are uneducated, obtuse, or are deliberately obfuscating the issue for political purposes.

 

7 minutes ago, smac97 said:

But your reckoning doesn't apply to just churches.  It applies to everybody.  So you seem to be singling out the LDS Church for behavior that all of us do (use the tax code to minimize tax obligations).  Am I wrong?

Yes, you are wrong. On this point I haven't criticized the LDS Church at all. Not an iota. I criticize them for not being transparent, but I don't fault them for the tax treatment they receive. I do fault Congress and voters for some of the bad decisions they've made regarding the tax code. But that's way off topic.

[Exiled]

1 hour ago, Bernard Gui said:

 What would be the Church’s interest in what members earn? Why would the Church care? Who would want or need that information? At what level would it be needed? How would it be used?

The more affluent seemed to be called to positions. Of course affording to be able to serve as a bishop or mission president, etc is important to know. Also, one of the G.A.'s in my ward, who was our home teacher at the time, related to us how he went down to TX to make a special appeal to a wealthy member there. He obviously had an idea of what the guy could afford.

[HappyJackWagon]

This televangelist is asking his followers to pay $54 million for a new jet so that he can do God's work. It sounds like an obscene amount of money for a luxury item but he's being transparent about how he plans to spend the $54 million. This gives his followers the ability to choose whether or not they believe it is really God's will to buy this jet, and then make their donations based on full information.

Transparency is a good thing. Knowing that the church is going to spend $xxxx on a temple, or a jet, or invest in the market, is a good thing.

Quote

KSFisher- When the market goes down why would one not expect the church's investments to go down as well?  The church may have a sound investment strategy, but I would not expect it to be full proof.

True, but I believe it would be relevant to know the level of risk the church was taking with consecrated funds. If they were risking 100% of the church's liquid assets in the Stock market I would suggest that risk is too high. If it was only 1% perhaps that would seem a good risk. But what if they were risking 40% of liquid assets in stock, or 50, 60+% in stocks? And what are the stocks? Would it bother anyone if they were heavily leveraged in Phillip Morris company stocks (Big Tobacco)? Or what about Anheuser Busch? Would it be hypocritical or simply savvy financial investments? I think these are worthy of discussion in the church. But as it is the only discussion revolves around sustaining leaders and paying tithing.

http://www.fox5atlanta.com/news/evangelist-wants-54m-jet-jesus-wouldn-t-be-riding-donkey

[Analytics]

24 minutes ago, Bernard Gui said:

I drive on the county roads to church. My property and gas taxes (considerable in Washington) pay for those services. The Church pays all legal obligations. How elseshould the Church be taxed? If the Church were to be taxed for such services, who would be paying the tax?

If I were in charge, donations made to churches would not be tax deductible, and churches would have to pay property taxes at the same rates as everybody else. If churches were taxed this way, then other tax rates would go down so that it would be revenue neutral.

[smac97]

15 minutes ago, HappyJackWagon said:

Does it make you wonder how much money the church lost in the 2008 stock market? Would it shock/disturb you if you found out the church lost $50 million dollars in the stock market over the course of a couple of years?

I would hope that the Church is a good steward of its finances.  That necessarily includes taking risks.  Parking money in the bank is low risk, but also poor stewardship because inflation may well exceed the interest accrued.  The Parable of the Talents would seem to require the Church to not merely preserve the original capital, but to increase it.  That means . . . risk.  And sometimes that risk may actually lead to financial losses.  However, the Church seems to be doing a pretty good job overall.  Nobody seems to be faulting the Church's ability to preserve the first five talents and earn five more to boot, which suggests that the Church is managing financial risks pretty well.

15 minutes ago, HappyJackWagon said:

Who would be to blame? No one, because you'd never know about it.

I'm not particularly interested in allocating blame for things not within my stewardship.  I remember when the Church purchased the Main Street Plaza space some years ago.  I was in law school at the time.  I remember reading about how the Church purchased the land with a public access easement, but with the city's permission to regulate speech on that easement.  I was only a law student at the time, but this seemed . . . off to me.  After class one day I approached my professor (who taught real property law) and asked him about this.  I laid out the problem, namely, that a public access easement would seem to have "strings attached," namely, behaviors that are typically involved in public spaces - such as "Free Speech."  I asked him how he thought the Church was going to be able to regulate speech on a public access easement, and he said he wasn't sure it could, and that this may have been an error.  Sure enough, he was right.  The next year, the Tenth Circuit Court of Appeals observed:

Quote

The City contends that acquiescing to the LDS Church's demand to control speech on the easement was necessary to obtain the Church's agreement to buy the property. That may be true, but the City may not exchange the public's constitutional rights even for other public benefits such as the revenue from the sale, and certainly may not provide a public space or passage conditioned on a private actor's desire that that space be expression-free. The City must "`bear the attendant costs.'" Hawkins, 170 F.3d at 1288 (quoting ISKCON, 505 U.S. at 700, 112 S.Ct. 2711 (Kennedy, J., concurring in judgment)). If it wants an easement, the City must permit speech on the easement. Otherwise, it must relinquish the easement so the parcel becomes entirely private.

So the Church, or rather the Church's attorneys, appear to have made a pretty substantial error in judgment in negotiating the Church's purchase of the Main Street with terms that ended up being problematic from a real property / free speech point of view.  Correcting this error required the Church to purchase the easement again (yep, the Church paid for the easement twice, the first time by paying the full purchase price of the property (as if there were no easement), and the second time by paying cash and swapping land).

Is it my place to "blame" anyone for this error?  I don't think so.  It was an error, and an expensive one.  But we're all human.  We live and learn.  The Church and its attorneys made a mistake.  Lesson learned.  We move on.

15 minutes ago, HappyJackWagon said:

I don't know how much the church lost in 2008 but I bet it was substantial. I wonder if the church has recouped all of its losses in the past decade or if that $32 billion is still down from what it once was.

An interesting question.  Has the Church earned more with its stock investments overall as compared to if the Church had simply parked these funds in the bank?  Or will past losses be made up in the long run?  

Thanks,

-Smac

[HappyJackWagon]

10 minutes ago, bluebell said:

It wouldn't bother me.  I feel like the scriptures (specifically the one about the talents) are clear that we can't use the presence of risk as a reason not to work within our stewardship to increase the blessings God gives us to work with.  He expects us to take the risk and do our best.

If those in charge of the church's finances are truly doing their best (given the education and information they are working with) then from my perspective no one is to blame if money is lost in a recession.  

I think the bolded question is interesting though because it does show that money in the stock market doesn't necessarily represent actual money until the stock is sold.  Like many homeowners learned when the housing market crumbled, it only matters if you were upside down on your mortgage if you are trying to sell.   If you weren't, then it didn't matter what your house was currently worth. 

 

I think I like that application of the parable of the talents. However, one difference would be that each person who was given a talent retained the value of that talent. I wonder what would have happened if the person who had been given 5 talents returned with 4 and blamed a bad investment.

 

[Analytics]

3 hours ago, Stargazer said:

Where else should they put it?  Under President Nelson's mattress?  In a money pit under the floor of the Tabernacle?  Or convert it to gold bars and keep it in the basement of the Alamo?

Matthew 6:24-34 comes to mind:

24 No man can serve two masters: for either he will hate the one, and love the other; or else he will hold to the one, and despise the other. Ye cannot serve God and mammon.

25 Therefore I say unto you, Take no thought for your life, what ye shall eat, or what ye shall drink; nor yet for your body, what ye shall put on. Is not the life more than meat, and the body than raiment?

26 Behold the fowls of the air: for they sow not, neither do they reap, nor gather into barns; yet your heavenly Father feedeth them. Are ye not much better than they?

27 Which of you by taking thought can add one cubit unto his stature?

28 And why take ye thought for raiment? Consider the lilies of the field, how they grow; they toil not, neither do they spin:

29 And yet I say unto you, That even Solomon in all his glory was not arrayed like one of these.

30 Wherefore, if God so clothe the grass of the field, which to day is, and to morrow is cast into the oven, shall he not much more clothe you, O ye of little faith?

31 Therefore take no thought, saying, What shall we eat? or, What shall we drink? or, Wherewithal shall we be clothed?

32 (For after all these things do the Gentiles seek:) for your heavenly Father knoweth that ye have need of all these things.

33 But seek ye first the kingdom of God, and his righteousness; and all these things shall be added unto you.

34 Take therefore no thought for the morrow: for the morrow shall take thought for the things of itself. Sufficient unto the day is the evil thereof.

Matthew 19:21 also comes to mind:

21 Jesus said unto him, If thou wilt be perfect, go and sell that thou hast, and give to the poor, and thou shalt have treasure in heaven: and come and follow me.

[hope_for_things]

2 hours ago, The Nehor said:

7 hours ago, hope_for_things said:

For many that are opposed to the Church being financially transparent, when things do change and the church becomes more financially transparent in the future, I expect that these same people will be in favor of that transparency.  For some, its all about allegiance to the current practices of the institution.  

Are you implying that is a bad thing?

I think that depends on the situation.  If a particular practice by the institution that benefits society in positive ways is supported by the allegiance of members, then I think its a net positive in those situations.  When the institution has negative practices that are perpetuated by those in allegiance to the institution, then those practices have a negative impact on society at large.  Allegiance is not necessarily morally good or bad from my vantage point, it has its pros and cons.  

[hope_for_things]

2 hours ago, carbon dioxide said:

7 hours ago, hope_for_things said:

With annual revenue estimated in the $30B range,

Where did you get this from?

I heard Mike Quinn reference this on at least one interview where he was discussing his new book on the church's finances.  If I remember correctly he estimated roughly $20B annually in tithing and another $10B in corporate revenue.  I have heard similar estimates somewhere else in the $30B - $50B range, but I can't recall where exactly.  I'll have to see if I can find a reference and get back to you.  Of course these are just estimates since the church isn't transparent about their finances.  

[HappyJackWagon]

4 minutes ago, smac97 said:

1-I would hope that the Church is a good steward of its finances.  That necessarily includes taking risks.  Parking money in the bank is low risk, but also poor stewardship because inflation may well exceed the interest accrued.  The Parable of the Talents would seem to require the Church to not merely preserve the original capital, but to increase it.  That means . . . risk.  And sometimes that risk may actually lead to financial losses.  However, the Church seems to be doing a pretty good job overall.  Nobody seems to be faulting the Church's ability to preserve the first five talents and earn five more to boot, which suggests that the Church is managing financial risks pretty well.

An interesting question.  Has the Church earned more with its stock investments overall as compared to if the Church had simply parked these funds in the bank?  Or will past losses be made up in the long run?  

Thanks,

-Smac

1- I would hope so to. And since we don't have any way to review the finances, hope is all we have   I agree that it may require some risk if the church's purpose and stewardship is primarily to grow its assets but I wouldn't concede that that should be its purpose and stewardship. You're right that the church seems to be preserving the 5 talents, but we don't really know how that has played out with its financial investments over the last decade. Is it possible the church now only has 4 talents because of stock market losses?

2- Past losses may be made up in the long run OR there could be increased losses. It's a risk. It might be a good risk based on total assets or it may be a bad one. We have no way of knowing since that information isn't shared. But instead of thinking of the church's primary role as increasing its financial strength, either by investing in stocks or by parking the "funds in the bank", perhaps we should give more consideration to the opportunity costs of not doing good with the money now verses hoping to do more good in the future.

[stemelbow]

4 hours ago, Robert F. Smith said:

The per capita contributions to charity is higher for the LDS Church than any other church or religious organization. 

If true, then all the more a problem.  Apparently Warren Buffett alone has given more to charitable causes than the Church has ever given.  Per capita, apparently, the Church is way behind in giving.  

4 hours ago, Robert F. Smith said:

The billionaires listed by Forbes are not organizations which have most of their assets tied up in real estate (chapels, temples, real estate investments, maintenance costs, etc.).

That seems like you have insight into their assets just as you seem to have insight into the Church's finances.  How'd you get that access?  I thought one of the main complaints here is the Church is not being transparent.  The tone of your post seems to want to defend the Church lacking transparency, but apparently you know that which none of us know.  

4 hours ago, Robert F. Smith said:

  So, although Bill Gates & his wife give huge sums for charitable purposes worldwide, that is not the whole story:  Gates has a net worth of nearly $82 billion, of which just $14 billion is in Microsoft stock. The bulk of the remainder — $64 billion – is invested in a variety of assets through Cascade Investment LLC, his private investment firm.  One must make a more careful assessment of each person and entity in order to be fair.

Sure.  Break it all down and make a comparison.  That'd be nice.  BUt apparently these billionaires have been more transparent than the Church.  As of now the comparison doesn't seem possible because we have no access to Church info.  

[Stargazer]

10 minutes ago, Analytics said:

Matthew 6:24-34 comes to mind:

24 No man can serve two masters: for either he will hate the one, and love the other; or else he will hold to the one, and despise the other. Ye cannot serve God and mammon.

25 Therefore I say unto you, Take no thought for your life, what ye shall eat, or what ye shall drink; nor yet for your body, what ye shall put on. Is not the life more than meat, and the body than raiment?

26 Behold the fowls of the air: for they sow not, neither do they reap, nor gather into barns; yet your heavenly Father feedeth them. Are ye not much better than they?

27 Which of you by taking thought can add one cubit unto his stature?

28 And why take ye thought for raiment? Consider the lilies of the field, how they grow; they toil not, neither do they spin:

29 And yet I say unto you, That even Solomon in all his glory was not arrayed like one of these.

30 Wherefore, if God so clothe the grass of the field, which to day is, and to morrow is cast into the oven, shall he not much more clothe you, O ye of little faith?

31 Therefore take no thought, saying, What shall we eat? or, What shall we drink? or, Wherewithal shall we be clothed?

32 (For after all these things do the Gentiles seek:) for your heavenly Father knoweth that ye have need of all these things.

33 But seek ye first the kingdom of God, and his righteousness; and all these things shall be added unto you.

34 Take therefore no thought for the morrow: for the morrow shall take thought for the things of itself. Sufficient unto the day is the evil thereof.

Matthew 19:21 also comes to mind:

21 Jesus said unto him, If thou wilt be perfect, go and sell that thou hast, and give to the poor, and thou shalt have treasure in heaven: and come and follow me.

So you want the church to sell all its liquid assets and hand it all out to the poor?  What will they do after that?  

As for the rest of it, do you really think the Lord was counseling his followers to "take no thought" for all that, just have everyone wear sackcloth and go about as mendicants?  Not even he did that.  

[stemelbow]

3 hours ago, JLHPROF said:

Why?

Somewhere we got the mistaken idea that the Church's main function is charitable giving.  It's not, although it is a principle of the Church and gospel.

But we aren't the Red Cross or the Salvation Army.  We help the poor and needy, but the restored doctrines and ordinances and spreading them should always be priority one.

In fact, most admonition in modern scriptures to help the poor specifically refers to members. Not to the world at large.

Main function?  40 million of the Church's far more than 32 billion net worth would not even suggest the Church has a primary principle of helping the poor and needy.  It's like an average person making 50,000/year giving 62 bucks a year to the poor and needy.  I don't think it'd be wise for a person who made 50,000 a year giving 62 bucks a year to charitable causes should go around boasting about giving so much.  On the flip though, the Church requires a 50,000/year person to give them 5,000/year in order for them to be declared worthy.  

[stemelbow]

1 hour ago, Jeanne said:

Wouldn't it be nice if they could share with members..how to invest??  Build your own tithing fund!!

If the Church were smart, it'd do just that.  The Church would benefit from the added tithing donations.  

[JLHPROF]

2 minutes ago, stemelbow said:

Main function?  40 million of the Church's far more than 32 billion net worth would not even suggest the Church has a primary principle of helping the poor and needy.  It's like an average person making 50,000/year giving 62 bucks a year to the poor and needy.  I don't think it'd be wise for a person who made 50,000 a year giving 62 bucks a year to charitable causes should go around boasting about giving so much.  On the flip though, the Church requires a 50,000/year person to give them 5,000/year in order for them to be declared worthy.  

Again, so what?

Why is it a function of the Church to give to charitable services?  

And I'd wager they do far more to help the poor and needy internally - how many ward members get aid from the Bishop that doesn't register as charitable giving on the financial portfolios?