David moves from the planned opposition of God’s enemies to God’s personal response to all of their plans. His response should be encouraging to believers everywhere and utterly terrifying to His enemies.
What does God do in response to the plans of those who oppose Him? First of all, He laughs. This should be amazing to us, who sit and worry and harbor anxiety at the affairs of the world and the attacks on our faith. Luther puts things in perspective for us. “But what does He do who dwells in heaven? Does He fear as we do? Does He tremble, or is He moved? Clearly not. But He laughs at the folly and the vain attempts of men.”
Why doesn’t God get angry? Why laughter? “He sees, but is not so swiftly moved to anger as we. He hides His wrath. He laughs a while, not only because He sees that such attempts are vain, but because He grants time for repentance.” God is infinitely wise and infinitely patient. He’s capable of accurately analyzing a situation.
When it is time for action, God does not hold back. Verse five says that He responds in wrath and fury. When God speaks, things happen. Just think about the creation account in Genesis 1. All God did was speak. He didn’t build. He didn’t carve. He spoke. “That is a language different from ours. When the sun rises, when the sun sets, God speaks. When the fruits grow in size, when human beings are born, God speaks. Accordingly the words of God are not empty air, but things very great and wonderful, which we see with our eyes and feel with our hands.”
What are the contents of this particular speech? “As for me, I have set my King on Zion, my holy hill.” God establishes Jesus Christ as the plumb line by which all people, kings, rulers, and notions will be judged. In the end, we will all either be freed by grace and mercy or judged in wrath and fury.
Insights from the Septuagint
4The one who dwells in the heavens will laugh at them;
and the Lord will ridicule them.
5Then he will speak to them in his anger,
and in his fury he will cause them great distress.
6“But I myself have been appointed king by him
on Zion, his holy mountain.”
The big issue here with the Septuagint is the change of point of view in verse six. In the English translations, God is speaking about the king he has set on Zion. In the Greek translation, the king is speaking about what God has done for him. It would appear that the writers of the Septuagint believed that since David was the author of the psalm, he would be the one speaking about being appointed king.
One other quick note: the word I translated “ridicule” literally means “to turn one’s nose up.” Think about that word picture when you imagine God responding to his opponents. That is a true picture of confidence.
Law & Gospel
The law in this passage is for the opponents and enemies of God. This should be significant to all of us, because as sinners, we are called God’s enemies (Rom. 5:10; Col. 1:21). Any effort that is made to overthrow God with our sinful actions or replace God with ourselves on the throne instead of Him will be met with mocking laughter, anger, and punishment. Our rebellion is not a threat to God even in the slightest.
God ultimately responds to sin with wrath and fury. This is in direct contrast to those who can’t possibly imagine a loving God being angry and sending people to Hell. God does get angry. He especially gets angry at those who ignore His mercy and kindness (Rom.2:4) and continue to live in rebellion against Him. If He were simply to ignore such behavior and sweep it under the rug, He wouldn’t be a loving God at all.
God proceeds to establish His King on Mount Zion. As mentioned above, this will either be terrifying for those found to be in opposition to Jesus Christ and His gospel, or it will be pure joy and elation for those whom Christ has saved.
Does God literally place Christ on Mt.Zion to reign? Yes and no. First, as this passage serves as a prophecy of Christ, Mt. Zion points to the location of David’s throne in Jerusalem, which is where Christ did much of His ministry and was eventually crucified.
But Luther teaches that there is more to this prophecy than just that. “For it mentions the physical place to make us believe that this divinely appointed King is true man and a real person, so to speak, who can be taken hold of, seen with the eyes, touched with the hands.” The idea here is that God has indeed established His King, and He has done this in history.
Christ has physically come to deliver us from sin, death, and the devil. He has conquered these and now reigns forever as King. Will we stand before God in judgment with nothing but our own actions to accuse us apart from His grace and mercy, or will we be pardoned, covered by His blood that He shed for us?
 Martin Luther, vol. 12, Luther’s Works, Vol. 12 : Selected Psalms I, ed. Jaroslav Jan Pelikan, Hilton C. Oswald and Helmut T. Lehmann, Luther’s Works (Saint Louis: Concordia Publishing House, 1999),Ps 2:4.
 Ibid.,Ps. 2:5
 Ibid.Ps. 2:6.