The current economic system

[SFatima]

It was also observed that the current financial crisis had a very little effect on the few small banks which had incorporated the shariah (islamic) rules in their transanctions and loans etc.

People may think that owning lots of paper money makes them rich but in reality they're always in the bargain for loss, it is always being de valued. Gold as the currency was the rule of economics in Islam, no interest, no monopoly, free markets, no heavy trade taxes, no compromise on quality. Thats all i know.

 

[Scimitar]

Gold never decreases in value when it is in Muslim lands... and more often than not - it maintains the same value within the lands - and increases in value when it is traded in foreign lands. This keeps the Ummah strong in monetary terms, so it is difficult to take advantage if by oppressive nations.

Bring back the Dirham and the Dinar, and Muslims grow a stronger, more stable economy through it. Allah in HIS infinite wisdom chose the dirham and the dinar as our currency, Allahu Akbar.

Did you know that the Zionists are creating currency in gold and silver? Why do you think that is? I know the answer but I'd like to know if any of you know...

 

[aamirsaab]

2 things you should know about gold:

1) There's not enough of it to facilitate global trading. So it would be less than ideal as a currency.

2) As you are aware, Gold constantly appreciates in value over time. So people are less likely to spend it and are more likely horde it instead. This inevitably would lead to riba, as people would end up buying and selling gold (which is exactly the problem we have now) - defeating the purpose entirely of bringing in another currency.

The real issue however is nothing to do with currency. What needs to be changed is the perception of money. In Islamic economics, it's merely something you buy products with (i.e a means of exchange). In modern economics, money itself is a product.

 

[GuestFellow]

^ I think people may begin to consider bartering.

 

[FS123]

If you maintain that interest is haraam in every possible circumstance, then, via qiyas, you can easily deduce that all kinds of capital gains are haraam. Which throws capitalism out of the window directly.

Leaving us with the choice between a classical centrally planned Communist economy and anarcho-syndicalism ;D

Short answer: no. We had big discussion related to interest, read this: http://forums.understanding-islam.com/showthread.php?11056-Murabaha-really-Islamic

To save sometime I'll recommend the following posts:
http://forums.understanding-islam.c...really-Islamic&p=163792&viewfull=1#post163792 (good example)

http://forums.understanding-islam.c...really-Islamic&p=163802&viewfull=1#post163802


http://forums.understanding-islam.c...really-Islamic&p=163592&viewfull=1#post163592
http://forums.understanding-islam.c...really-Islamic&p=163599&viewfull=1#post163599
http://forums.understanding-islam.c...really-Islamic&p=163621&viewfull=1#post163621
http://forums.understanding-islam.c...really-Islamic&p=163771&viewfull=1#post163771
http://forums.understanding-islam.c...really-Islamic&p=163788&viewfull=1#post163788
http://forums.understanding-islam.c...really-Islamic&p=163912&viewfull=1#post163912

 

[Scimitar]

^ I think people may begin to consider bartering.

Bartering is the halal way. If you read up on Islamic economics, you'll see that this is indeed the preferred way. Gold and silver currency is something which there to facilitate an alternative when there is nothing to barter with. A kind of last resort.

In the last video that I posted, Sheikh Imran Hosein explains all this in a better way.I highly advise you all to watch it.

 

[aamirsaab]

^ I think people may begin to consider bartering.

Bartering is the halal way. If you read up on Islamic economics, you'll see that this is indeed the preferred way. Gold and silver currency is something which there to facilitate an alternative when there is nothing to barter with. A kind of last resort.

Bartering is indeed halal and prefered, but unfortunately only works on smaller scale, like food, clothes etc. Problems occur with bigger and larger scale items, such as buildings (flats, houses etc). You would not be able to barter a house with another house for instance as this is riba. But I don't think any house seller would accept 10 tons of wheat for it either. So you would have to use an alternative means of exchange i.e. currency.

I think what we all have to understand is that during the Prophet's time, we weren't dealing with billions and trillions in terms of monetary exchanges/sales/purchases. We weren't buying and selling houses or flats (certainly not on such a grand scale we are in modern times). We weren't buying/selling shares in the stock market and so on - those markets didn't/barely even existed then. But now they do and both they and the amount of currency being traded -both on a global and regional scale- have grown immensely (different set of circumstances), so you have to understand these differences in order to find appropriate solutions.

It is not however a case of out with the old, in with the new as there is a lot of wisdom in Islamic economics that can benefit the finance industry (ethics before profit, less exploitation, no riba etc). It's just that when you're dealing with problems/issues that quite simply didn't exist before, you're going to need new solutions. Which is where the new breed (Islamic finance/economic students) come in.

 

[Crystal]

Thanks all for the resources - its a little confusing for me - I think you really have to know a lot about economics to understand it but hopefully one day I will understand it more