The first psalm looked at the righteous man and his relationship with God, indicating the blessings that flowed to him from God.. This psalm looks at the Righteous One and His relationship with man. It is necessary first to consider the background to this Psalm for it concerns first the King of Israel. It describes him as YHWH's anointed, His adopted son and as the prospective world ruler. But in the end it has in mind the Great King Who is yet to come, the One Who will fulfil all YHWH's will..
Abraham was called by God to leave his family and go to the land of Canaan. When he arrived he received the first of a series of promises. Part of that promise was that the whole world would be blessed through him (Genesis 12:3). This was later expanded to include the fact that he would be the father of kings who would rule nations (Genesis 17:6). And indeed in the thinking of those days the only way by which a man could bless the whole world would be seen as by ruling over it. Thus intrinsic in these promises was that Abraham's descendants would rule ‘the world'.
A hint of this was included in Genesis 49:10 and Numbers 24:17, both of which indicated the ruling of an empire by the coming descendant of Judah/Israel. The idea was vague but growing. They thought in terms of their ‘world'. Exodus 19:6 speaks of Israel becoming a kingdom of priests and this again required that the nations should look to Israel. Thus Israel had a growing sense of the fact that one day they would be called on to act on God's behalf on the world as it was around them.
Then the triumphs of David caused hope of the fulfilment of the dream. And this was when this psalm was written. To take it as just the description of a local squabble is to overlook a number of things. Firstly Israel's vision of itself; secondly, the fact that David was a poet as well a king, with all a poet's dreams; and thirdly, that his meteoric rise, as well as his successes, was extremely likely to cause a hunger after more. In the eyes of most of Israel he must later almost have seemed to be king of the world. He certainly ruled their ‘world', and the ‘worlds' round about, with an iron hand. And this would probably have seemed even more so in the splendour of the reign of Solomon. They are a picture (when viewed idealistically) of the future Kingly Rule of God.
So David exulted in his privilege as being made YHWH's anointed, and he calls on the nations to submit and yield themselves to YHWH. Then and then alone will come worldwide blessing. He no doubt hoped for it in his day, with the eyes of the visionary, or at the worst in his son's day. But he spoke better than he knew. For its fulfilment would await the coming of his Greater Son, Jesus Christ.
After the fall of Solomon this idea of future kingship was taken up with a vengeance by the prophets. In their eyes the collapse of the kingdom had not removed the possibility, only delayed it. Although the kingship appeared to be in decline they declared that YHWH could not finally fail. God had promised to David an everlasting kingship. So there would come one day a king from the house of David, endued with the Spirit of God, who would become the perfect example of righteousness and He would rule the world, with the result that the nations would be transformed (Isaiah 9:6-7; Isaiah 11:1-4 with 9-10; Psalms 32:1-2; Psalms 72; Ezekiel 37:24-28). Thus the continual ideal ‘king to come' was seen as destined to rule the nations, bringing the blessing promised to Abraham on all the families of the earth. This was their hope. This was their dream. And it was necessary in order to fulfil God's promises for the kingship, and God's promises to Abraham. So when David failed to fulfil the ideal, the coming of a greater David became a certainty. And it was that dream that was in the people's minds when this psalm was sung throughout the periods of the first and second temples and beyond.
In Acts 4:25-26 the new people of God refer to the opening words of this psalm saying ‘Who by the Holy Spirit, by the mouth of our father David did say'. Then they referred the significance of the Psalm to Jesus. They saw the psalm as spoken by the Holy Spirit through David and fulfilled in the coming of Jesus, and especially in the resurrection of Jesus, the final fulfilment of the psalm. He had been treated abominably by all the world, both king and governor, both Gentile and Jew (Acts 4:27), but had finally been set on God's holy hill as YHWH's Anointed (Acts 2:34-36).
The time of the writing of the psalm was probably not too long after Nathan's vision from God, declared to David in 2 Samuel 7:8-16. We can imagine the impression those words made on David as he saw himself as the anointed of YHWH, adopted as His son, as his sons would be after him. Thus he sought to express the ideal in poetry. Each was ‘YHWH's anointed', but ever awaiting the One Who would rule the everlasting Kingdom (2 Samuel 7:13; 2 Samuel 7:16).
It seemingly also arose at a time when there were simmerings of rebellion among the tribute nations. Possibly there was news of a plot afoot to rebel against David. But he was not afraid, for he knew that he was YHWH's anointed. He knew that he had defeated the mighty Philistines, taking over their empire (2 Samuel 8:1-14), and even at that stage the vision was possibly already growing in his mind of a ‘world' empire over which YHWH would rule. If he could defeat them he could defeat anyone.
So in the psalm he signalled the certainty of the triumph of the favoured of YHWH, and gave warning to all of what it would mean to rebel against him and his God. Indeed the poem might have been despatched to kings in his empire as a subtle warning that he was aware of plans that were afoot. Inevitably they would be brought into fruition at any sign of weakness. But when it was sung regularly within the Temple it signified a looking forward to the dream, the dream of the great and godly king of the house of David who would one day arise, with YHWH's help and power, to rule the world, thus fulfilling David's vision.
The psalm begins with the nations and rulers seething and hatching rebellion against YHWH and against His anointed king. It continues with YHWH's derision of their attempt to overthrow His anointed. Then it declares to the nations that this one against whom they rebel is in fact YHWH's ‘son', adopted by Him in order that he might rule the world and bring judgment on God's enemies. And finally it calls on the nations to submit to YHWH and His son, finishing with the words “Blessed are all those who put their trust in Him”.
While possibly springing from a specific occasion we must remember that this is poetry. It was intended to be sung. It depicted David's view of the Davidic kingship. It was a vision of the significance of the rule of the ‘anointed of YHWH' which would carry on through generations, and it was his idealistic view of what it would achieve. David did not just have himself in mind. He thought of his sons, and his son's sons over an everlasting kingdom, with all men submitting to YHWH, as YHWH had promised him (2 Samuel 7:8-16). It was to be fulfilled in Great David's Greater Son.