Just as the First Commandment deals with the inner heart, the Second deals with our outward expression of our love for God. If we truly fear and love God, we will not use the Lord’s name in vain or as a prop for our perspective or side of an argument. We will revere it and keep it holy. Luther warns that the most profane use of God’s name in found in the words and deeds of false preachers. How true recent history bears this out. From televangelists who bilk millions from the faithful, only to be caught in all forms of anti-Christian behavior, to those using God’s name to justify oppression and violence, pervade our culture – we can clearly see how people are being led astray from the true Shepherd.
Q. What does this mean?
A. We are to fear and love God, so that we will not use His name to curse, swear, cast a spell, lie or deceive, but will use it to call upon Him, pray to Him, praise Him and thank Him in all times of trouble.
From Luther’s Large Catechism
50] As the First Commandment has instructed the heart and taught [the basis of] faith, so this commandment leads us forth and directs the mouth and tongue to God. For the first objects that spring from the heart and manifest themselves are words. Now, as I have taught above how to answer the question, what it is to have a god, so you must learn to comprehend simply the meaning of this and all the commandments, and to apply it to yourself.
51] If, then, it be asked: How do you understand the Second Commandment, or what is meant by taking in vain, or misusing God's name? answer briefly thus: It is misusing God's name when we call upon the Lord God, no matter in what way, for purposes of falsehood or wrong of any kind. Therefore this commandment enjoins this much, that God's name must not be appealed to falsely, or taken upon the lips, while the heart knows well enough, or should know, differently; as among those who take oaths in court, where one side lies against the other. 52] For God's name cannot be misused worse than for the support of falsehood and deceit. Let this remain the exact German and simplest meaning of this commandment.
56] Here, then, let us learn and take to heart the great importance of this commandment, that with all diligence we may guard against and dread every misuse of the holy name, as the greatest sin that can be outwardly committed. For to lie and deceive is in itself a great sin, but is greatly aggravated when we attempt to justify it, and seek to confirm it by invoking the name of God and using it as a cloak for shame, so that from a single lie a double lie, nay, manifold lies, result.
Large Catechism Text in the public domain. http://bookofconcord.org/lc-3-tencommandments.php