What are the causes of economic crisis? Why have the prices of basic commodities increased by 100% followed by a world economic meltdown?
The Talmud tells us that economic crises are a wake up call to change our ways.
It is told in the Gemara that before the destruction of the holy temple in Jerusalem the price of grain was 40 Modiut (measures) per Dinar. The price of grain went up slightly and its new price was set at 39 Modiut per Dinar. The sages wondered what was the cause of this increase. They searched and found that there was a case where a father and his son had relations with a betrothed woman. The father and son were brought to court, were subsequently found guilty and stoned. After the verdict was carried out the price of grain returned to the original price of 40 Modiut per Dinar.
According to this Gemara the moral level of society can influence the costs of basic commodities and effect the local and world economy. Society’s moral level influences the amount of “Shefa” in the world and the harmony of interaction between people effect the economy.
The Chofetz Chaim, European Jewry’s greatest sage of the 20th century, wrote that the Great Depression of 1929 was brought about because of that generation’s lack of trust in Hashem which led to a lack of trust between people. Though the period leading up to the Great Depression was one of great prosperity, the lack of confidence and trust between people ultimately caused the sources of credit to shrivel up. This in his words, “Caused the central artery for the flow of economic life to become clogged by animosities.”
This is quite similar to today’s economic meltdown, which was initiated by the subprime mortgages, which were based on the unethical loan of money to people who most likely not be able to pay it back and would have to suffer the consequences of morgage defaults.
When the price of commodities rises unexpectedly and the world is facing an economic meltdown we should look for both the observable and metaphysical reasons as to why this is happening.
Judaism and the Environment in the Talmud 