format_quote Originally Posted by
rpwelton
I didn't even realize this thread was resurrected; I happened to come across it while browsing earlier today.
In regards to Islamic Finance, I am mostly opposed to the industry as a whole because it is no more than a "work-around" for conventional interest-based financing. There is no such thing as an "Islamic Mortgage", and when it comes to investing in the stock market, every single public company uses interest-based means of financing.
Although there may be a few companies out there in the world operating under the guise of true Islamic financing, the majority out there do not.
The only way true Islamic finance is going to take root is if a true Islamic state were to be established somewhere in the world.
:sl:
Agreed. Many banks here in Kuwait which are supposedly "Islamic" but still use interest and cover it up by using another name imsad.
At least we got to admit it has potential when executed right :)
see:
http://zawya.com/Story.cfm/sidANA200...%3A%20Malaysia
Global crisis a 'golden opportunity' for Islamic banking: Malaysia
KUALA LUMPUR, Jan 12, 2009 (AFP) - The global economic crisis has handed the Islamic finance sector a "golden opportunity" to show it is a better alternative to capitalism, Malaysia said Monday.
Although capitalism has been pre-eminent for centuries, "it is becoming obvious that there is now more proof of its weaknesses," Deputy Prime Minister Najib Razak said in a speech to an Islamic economic conference.
"We Muslims should see the current situation as a golden opportunity for us to prove the power, strength and effectiveness of the Islamic banking and finance system," he said in an opening address.
Islamic banking, a booming 1.0 trillion dollar global industry that prohibits speculation and high levels of debt, has been relatively unscathed by the credit crunch.
The rules of the sector -- which incorporate principles of sharia or Islamic law -- prohibit many of the risky activities that triggered the crisis that is felling economies around the world.
"An economic system that is not closely linked to real and productive activities is a threat to the entire system," said Najib, who is also finance minister.
He said the Islamic approach could provide "concrete and realistic" measures to tackle the crisis and that Malaysia, Southeast Asia's leader in the field, was committed to developing the sector with better training and marketing.
Islamic law prohibits the payment and collection of interest, which is seen as a form of gambling, so highly complex instruments such as derivatives and other creative accounting practices are banned.
Transactions must be backed by real assets -- not repackaged subprime, or high-risk, mortgages -- and because risk is shared between the bank and the depositor there is an incentive for the institutions to ensure the deal is sound.
Islamic finance also shuns investments in gambling, alcohol and pornography in favour of ethical investments.
Also see:
http://www.forbes.com/2008/04/21/isl...slam_land.html
Special Report
Islamic Finance
Edited by Elisabeth Eaves and Michael Noer
Islamic finance is booming.
At least $500 billion in assets around the world are managed in accordance with Sharia, or Islamic law, and the sector is growing at more than 10% per year. In spirit, Islamic finance seeks to promote social justice by banning exploitative practices. In reality, this boils down to a set of prohibitions--on paying interest, on gambling with derivatives and options, and on investing in firms that make pornography or pork. No one can say for sure how many of the world's 1.3 billion Muslims will demand Sharia-compliant financial products, but if even a fraction do, the world's largest banks will be happy to oblige.
This will also be interesting:
http://www.lariba.com/knowledge-cent...difference.htm
:w: