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**Fededorbprago** · 07-04-2012, 03:50 AM

Why can we not have a few people who can talk about Muslim interests. Economic matters are just one example of that. By the grace of Allah(SWT) Mufti Taqi Usmani Sahab(DB) is an expert on Islamic view about financial and economic matters but so far I have not got any indication that he has a grip over the current business, economic and financial environment and the forces and powers and their functioning and Muslim stakes in such matters.

The current financial system is based on two pillars - speculation and interest (debt). Most of the financial instruments such as derivatives and CDSs are about betting, with same counterparties on many side of the trades. Other intsruments such as SIV - strucutred investment vehicles, are opaque and the prices are determined using some arbitrary formulas such as for ABSs and MBSs. With almost all corporations even those who are sitting on billions of dollars of cash, use debt for financing to that they can leverage and optimize the existing capital, by deducting interest in their corporate income tax etc. Just like why people buy houses on interest today knowing well that they will get deductions in income tax on their interests. So even the technology (or any other sector) company stocks in which you are an investor is indirectly playing with these interest and speculation.

Remember, all above setups are structured in such a way that an individual small investor are the one who loses, because he has no insider information and is playing a blind hand and will not recieve a bail out. Speculation has caused the prices of commodities to skyrocket and made the cost of living (energy + food) very expensive. GOverment subsidy and incentive such as tax breaks on production of ethanol etc, has also contributed to increase in prices of agricultral commodities.

The coporate and individual tax rates are structured in such a way that it provides maximum benefits to those in the financial setup. Individual income tax on capital gains and dividends are normally placed in the lowest tax bracket - remember these folks makes the most money. The whole system is setup such that the rich becomes richer, while middle class are hooked on their month-month living so that they have no time to analyze anything, and poor become more poor and are no longer considered a part of civilized society.

Now the need of the hour is for Islam to present a fair and just economical system as an alternate to this baised casino of so called free market system. But, I do not see any effort being made whatsover by any section of Muslim society, most I see is that Muslims who are very religious go to Islamic banks for mortgage financing and thats about it. Imam Hosien does list all the ills of western "free market system" but he does not provide a solution as to what people can do at the micro level. Yes one could have bought gold and silver, but its not practiccal as you will still have to deal with "fait" paper currency.

I know that there are some halaal investment vehicles (both equity and bonds) in Malaysia and in some parts of the gulf, but I am not sure how they do their investments and what sort of returns they generate.

07-04-2012, 03:50 AM	#20
Fededorbprago Join Date Oct 2005 Posts 405 Senior Member	Why can we not have a few people who can talk about Muslim interests. Economic matters are just one example of that. By the grace of Allah(SWT) Mufti Taqi Usmani Sahab(DB) is an expert on Islamic view about financial and economic matters but so far I have not got any indication that he has a grip over the current business, economic and financial environment and the forces and powers and their functioning and Muslim stakes in such matters. The current financial system is based on two pillars - speculation and interest (debt). Most of the financial instruments such as derivatives and CDSs are about betting, with same counterparties on many side of the trades. Other intsruments such as SIV - strucutred investment vehicles, are opaque and the prices are determined using some arbitrary formulas such as for ABSs and MBSs. With almost all corporations even those who are sitting on billions of dollars of cash, use debt for financing to that they can leverage and optimize the existing capital, by deducting interest in their corporate income tax etc. Just like why people buy houses on interest today knowing well that they will get deductions in income tax on their interests. So even the technology (or any other sector) company stocks in which you are an investor is indirectly playing with these interest and speculation. Remember, all above setups are structured in such a way that an individual small investor are the one who loses, because he has no insider information and is playing a blind hand and will not recieve a bail out. Speculation has caused the prices of commodities to skyrocket and made the cost of living (energy + food) very expensive. GOverment subsidy and incentive such as tax breaks on production of ethanol etc, has also contributed to increase in prices of agricultral commodities. The coporate and individual tax rates are structured in such a way that it provides maximum benefits to those in the financial setup. Individual income tax on capital gains and dividends are normally placed in the lowest tax bracket - remember these folks makes the most money. The whole system is setup such that the rich becomes richer, while middle class are hooked on their month-month living so that they have no time to analyze anything, and poor become more poor and are no longer considered a part of civilized society. Now the need of the hour is for Islam to present a fair and just economical system as an alternate to this baised casino of so called free market system. But, I do not see any effort being made whatsover by any section of Muslim society, most I see is that Muslims who are very religious go to Islamic banks for mortgage financing and thats about it. Imam Hosien does list all the ills of western "free market system" but he does not provide a solution as to what people can do at the micro level. Yes one could have bought gold and silver, but its not practiccal as you will still have to deal with "fait" paper currency. I know that there are some halaal investment vehicles (both equity and bonds) in Malaysia and in some parts of the gulf, but I am not sure how they do their investments and what sort of returns they generate.
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