Moneybeat: Started with a crash

MARY REICHARD, HOST: Coming up next on The World and Everything in It: The Monday Moneybeat.

NICK EICHER, HOST: Well, it’s been five years that we’ve featured David Bahnsen: five good years, and we look forward to many more, Lord willing. But today, let’s have a look back on this fifth anniversary at what started all this. And you may remember, it grew out of economic crisis, a pandemic and a set of policy choices that followed. Let’s turn back the clock: March 23rd, a Monday morning, the year 2020.

EICHER:… we’ll say it again: Worst week since the financial crisis of 2008. All the major indexes down for the week between 12 and more than 17 percent.

It’s not just the capital markets, though. When people are on lock-down, major sectors of the economy they depend on are locked, too.

And so I’d like to turn back to David Bahnsen … thank you for giving us some time. Good morning.

DAVID BAHNSEN: Hey, good morning.

EICHER: I saw an estimate, David, that we’re looking at 5 million job losses this year. $1.5 trillion lost in economic output. Just estimates, of course. What’s your sense of the future, assuming this passes? Do we just bounce back to normal or do you see economic life just being vastly different because of the shock?

BAHNSEN: Well, I would be really careful of anyone who gives too confident of an answer because of the variables that exist out there. …

Do I think that the second quarter unemployment and GDP contraction is going to be just unbelievably bad? Of course. … What I do believe is the sort of base case, not as bad as it could very well get and not as good as it could very well get is that you would see approximately $1.5 trillion of economic output lost. … Third quarter and fourth quarter of this year are so much more important right now than the second quarter because the second quarter we know is basically going to be lost.

EICHER: … let me just give you the freedom to say at this moment, any message that you think it’s important that each listener hear.

BAHNSEN: The last thing I would say is that through this uncertainty, there is one certainty out there and that is that God is in control and that our country has been through worse. … And we will come out of this thing OK as well. I don’t know when. I don’t know how. But I do know that in those periods of most uncertainty, when one looks to the lesson of history and the hope of the future, they should derive optimism and we will get through this.

EICHER: Financial analyst David Bahnsen, God bless you. Thank you for your time.

BAHNSEN: Thank you for having me.

That’s a very truncated bit just to give you a sense, and it’s really something to go back and listen to. I’ll put a link in the transcript to the segment and you can look at it and listen for yourself. But five years on and going strong, David, it’s been great.

BAHNSEN: One of the things I love telling people, when I run into folks who listen to The World and Everything in It all over the country, it now seems that I’m running into WORLD listeners everywhere I go, which is a lot of fun, but a lot of people don’t know that there was never a time that we formalized my doing this. We just started doing it five years ago, and here we are still going!

EICHER: Just the force of habit, I guess, you know, regular in practice, but never in design, right?

BAHNSEN: That’s right. I love telling the story and oftentimes I wonder if you even remember it, but I imagine both of us do. Five years ago now, is the anniversary of the moment at which COVID was really becoming a matter of public awareness. It was into markets, which is what caused you to reach out to me the week of March 9th on that Monday, and then on that Thursday, March 12th—both days the market was down a couple thousand points, and we hadn’t had lockdowns yet. There hadn’t even been a fatality that we knew was related to COVID. We would later find out some nursing home deaths we had already started.

But on that week, there was a famous Wednesday night where all at once it was announced that the actor Tom Hanks had been diagnosed with coronavirus. They canceled the remainder of the NBA season. Then, more famously, President Trump went and addressed the nation from the Oval Office. He announced that there would be no more travel for people from Europe into the country or from Asia. And so then the market responded by dropping violently, and it was beginning to feel like, okay, something here is going on.

That’s when you had asked me to come on and talk about the market impact. And I did it. And I think your intent at the time was a one-time guest deal, and that’s certainly how I took it.

But then the next week, Nick, is when the lockdown started. On Monday, March 16th, we set the third record in six days of the worst market day since Black Monday of 1987 that one would hold the market would be down 3,000 points—about 13% in one day—and then throughout that week the speculation began: Are we looking at millions of people who are going to die? Are we looking at a permanently shut down economy? What’s going on?

So I came on again to talk about it. And I think that was the last time you asked me to come on to talk about the COVID market. from there, we just came on every single week and here we are five years later.

EICHER: So talk about what you’re seeing, from your vantage point, and how it seems so consistent with what we hear: that there’s a real hunger for good, reliable economic news and how it relates to a theology of human flourishing ,maybe too big of a question there, but—

BAHNSEN: No, no, not, it’s not. It’s important! Because, you know, I guess it would be up to you and up to listeners to say where maybe some of the things I say encourage them at times.

But for me, I am incredibly encouraged by the fact that there are people who reach out all the time to say, “I’ve never been that interested in economics. I’ve never been interested in markets, but I now, as a person of faith, want to understand this more.”

Of course it’s my heart’s desire to do this in the context of a Biblical worldview. It’s the cause I’ve long devoted my life to, so I believe there are specifically Christian ways of thinking about the economy. The fact that on this podcast there are such serious believers that are continually saying they want to learn more, hear more, and they find something about it animating.

It may be different things for different people. There are folks who will disagree with things from time to time—and we obviously encourage that and try to interact with people around that. But I’m very, very encouraged by how much I hear from people of the WORLD faith community who are wanting to understand economics more.

I think we need more people to do so. There is an intense need not to take economics for granted, finance, business, markets, entrepreneurship. These things fit within the domain of the kingdom of God, and therefore we have specifically Christian things to say about them. I’m really blessed over the last five years by finding out that there are so many others who want the same.

EICHER: You’ve always brought things back around to first principles—whether we’re talking the importance of capital formation, driving productivity, just simply a theology of work—how would you say the last five years have strengthened your convictions, or even tested them?

BAHNSEN: There’s been ample opportunity to have those convictions tested! Out of the last five years, it became the impetus for me to write two different books, both of which I wanted to write before five years ago, but neither one of which I had plans to write.

That impetus came first, There’s No Free Lunch: 250 Economic Truths, where I realized in 2021, there was a huge need for us to reconnect our belief in free markets to the human person. And to connect God’s design for the human experience, what it was God wanted for creation, and that that being the story of economics, that we needed to reconnect these things. We needed to tell the story of how liberty (free markets) and virtue (morality) need to coexist. That these things are not separate from one another and that our economic vision is one of synthesizing liberty and virtue.

Then, of course, the book on work, Full Time, that also just became a huge passion for me around the idea of reconnecting purpose to work. And then work being this verb of economics, that things get done because humans work, and we work because that was God’s created design for our life. Both are economic messages, and both came about in the last five years.

And you know, Nick, both are things you and I have gotten to talk about here week by week over and over again.

EICHER: So we’ve looked back, now let’s look ahead, what do you think the next several years look like, based on what you’ve been able to accomplish here over the past five?

BAHNSEN: I think there’s a very intense need to defend a market economy along the lines of a Christian worldview. And not merely defend it because we think it will lower our taxes, it’s a more efficient way of allocating resources, and because we think it will create a better result.

I do think it’s a more efficient way of allocating resources. I do think it creates better results.

But I think it needs to be connected to a moral message, a spiritual message, one that is found in the creational truths of Scripture. So that is the great passion that I have.

Now, what is the alternative here? Because there were a lot of people in America, not of a faith community, defending a free market for many years. But see, Nick, I believe that history took a pivot in 2008, at the point of the financial crisis. The efficiency claims of free markets were called into question and I think that the moral claims were not there. There was not a strong Christian witness to defend a market economy.

Now there are a lot of people, especially young people, tempted by the idea that the state can centrally plan the economy and we don’t need all this free-enterprise stuff.

Now, the difference is a lot of people on the right would say, “Yeah, but we want the state to do it our way. Let’s not have DEI, let’s not have woke, but yeah, let’s still have the state kind of mastering the economy.” Then, of course, people on the left, they have their own different agenda that’s more progressive.

But my view is that for humans to flourish, to most obey God, to most build strong communities, and ultimately a strong civilization, the need of the hour is a fully Christian message about human action.

That is what I think we have to be working on for the next few years. I don’t think it’s going to be easy, but I do think we’re going to prevail in the end.

EICHER: As you say at your company: to that end, we work. David, I’m glad we took this time to reflect, look forward to talking to you next week, and the next week, and the next week.

David Bahnsen, founder, managing partner, and chief investment officer of The Bahnsen Group. David writes at dividendcafe.com for WORLD Opinions, and you hear his news and comment here each week. David, thanks!

BAHNSEN: We’ll have to celebrate a 10-year anniversary one of these days, Nick!

EICHER: I’m here for it!

WORLD Radio transcripts are created on a rush deadline. This text may not be in its final form and may be updated or revised in the future. Accuracy and availability may vary. The authoritative record of WORLD Radio programming is the audio record.