I'm sorry for the struggles you and millions of others have been having because of the present economic crisis. We need to pray more for our leaders as they seek to find answers to these problems.
How can you explain this to your children? The best approach is to be honest with them -- not going into great detail, but simply doing what you can to help them understand why this Christmas isn't going to be lavish. It's not easy, I know; they see so much on television, and they hear so much from their friends about all the expensive gifts they hope to get. As a footnote, see if one of your local social service agencies (such as the Salvation Army) has a program to make gifts available to children in need.
But I also encourage you to make this Christmas special to them in other ways. Does your church have a Christmas program they'll enjoy? Can they help you decorate with ornaments they make, or help you bake something special for Christmas day? And remember: The greatest gift we can give our children isn't a toy or new computer game, but our love.
Most of all, take time to teach your children about the greatest Christmas gift of all -- God's gift of His Son, Jesus Christ. He knows your struggles, for His family too was poor. But through Him we can become spiritually rich, because "for your sakes he became poor, so that you through his poverty might become rich" (2 Corinthians 8:9).