Riba and the Pakistani Economy

Re: # 59

Excuse me, why the hell should I stay away from banking?? You want my money in your bank and you do not want to tell me what will you do with it?. If you haven`t noticed, it is this arrogance of the corrupt ruling class, which was the crux of my argument. This class consider itself above any accountability. Their arrogance has reached to this level that they have audacity to tie up prices of sugar with the bad sugarcane crop in Brazil. They don`t exactly say ``Jo ganna tum ne putna hay putt lo`` - yet - but they sure imply it with their actions.

Re: # 58
Lets c where we can agree:

(1) dream of a Pakisatn as an egalitarian welfare state is still achievable as long as they are willing to make sacrifices, totally with u, though our paths may be different.

(2) We both know u r not a banker

(3) Playing with the ding a ling can be much more productive....

Keep posting, but please stay away from banking..

Re: # 57

I am not as much a layperson as you think I am. I might not be a banker but I do have formal education in the subjects of Industrial and Labor laws and Laws governing industrial financing. So for the last time I urge you to have a focused and to the point discussion with me on this subject or you can still choose to keep picking up bones from that certain part of male anatomy as the punjabi proverb goes. I am committed to tell people that the dream of a Pakisatn as an egalitarian welfare state is still achievable as long as they are willing to make sacrifices.

Re: # 53

Let us examine what u said and now seem to retract:

You said......
{The first responsibility of Islamic government in the Islamic Republic of Pakistan will be to make arrangements and establish policies that are conducive to and facilitate the people of Pakistan to earn decent and honest living which is called Rizq-e-Halal. In order to achieve this objective we will have to eliminate the bloodsucking social class that has lost its fear of God. Those who do not fear God are the enemies of God and His people.}

Emphasis on eliminating the blood sucking social classes....

Then u go on to say.....
{Since interest and Riba is haraam, the institution of banking will be replaced by a federal government financial institution that will be called Baitul Maal or People`s Treasury}

Eliminate then replace with a federal govt financial institution....correct

Then u proceed to describe this new institution.......
{Initially, it will contain all the liquid assets that are currently owned by by all national and private banks}

Proposed Govt owned institution will contain all the liquid assets currently owned by all national of which only one is left and private banks. Correct. What u very clearly state is a nationlization, takeover of all customer deposits and private capital by the Govt and put it under the state umbrella. There is nothing ambiguous here. Customer deposits and private capital is private wealth which u very convieniently forgot or have no concept, more importantly u keep talking about currently held liquid assets? which for any bank can only be their LOANS to customers, investments, cash with other banks and cash held. Major portion of assets belongs to loans and investments, only someone with no knowledge of banking wud make that error of assuming banks have assets like machinery which can be taken over and converted with change of ownership.

Your ending statement on this particualr subject.....
{The role of institutionalized lending by any private or government institution, in the present day sense, will be abolished. THe trillions of rupees currently owned by these banks will be loaned to people who would want to establish a business}

Where are these trillions of dollars owned by banks that u intend to loan to people?? Shows someone shooting from his ass.

Since I had the audacity to challenge your copy and paste mentality, this is how you responded....
{Every chartered bank must establish a reserve with state bank, that must equal rupees to rupees with customer`s deposits. That is how a bank qualifies for running business in the country. State Bank keeps the checks and balance in this regard. So I am not talking about customer`s deposists to be used as a pool of funds to run the welfare schemes. Instead I am talking about putting all the liquid reserves into circulation. You should calm down.}

Again u demonstrate a copy and paste mentality and the proof is in the pudding so to speak. Every chartered bank must establish a reserve with the central bank, till here everything is fine, then u slip with the next blooper....that must equal rupees to rupees with customer deposits....if banks were required to maintain rupee to rupee of reserves ie 100% then how the hell wud they lend money and make profits? Do u understand now why ppl can lose their calm?? Its because u have no idea of banking like all the other fundos plagiarizing other people works and then trying to present a image of piety. Banks are required to maintaina fraction of their deposits as reserves with the central bank, restv they can use for their asset (loan) funding. Hund samaj ayee ke nahin?

Like I said b4, when u dont know the abcd of banking.....stop pretending and making an ass of yourself....

Re: # 55

``When we will establish a government that will not rule people of Pakistan but serve the people of Pakistan`` ............... but you already have a government that is serving you right here in michigan !

.......... you might be surprised but i agree with you on health care in the usa - it is a mess .......... but the answer is not in a beauracratic national health service - it can be done by regulating the insurance companies, the malpractice lawyers, the american medical association and expanding medicare and medicaid to insure the uninsured ....... i think governor romney is on the right track in massachusetts - you know that he is a fellow michigander, don`t you ? went to cranbrook, was a vp with bain and then founded bain capital, a very successful vc firm ......... why don`t you and i vote for romney as president in 2008 - it is a lot better than wating for the khilafat to be established in washington dc with marion barry as the first khalifa ........... look, they already have a khilafat in mogadishu and what has that done for them ?

........... urstruly, turn in your al-mohajiroon card and stop dreaming about establishing the khilafat because pretty soon they will find osama, his one-eyed brother-in-law and zawahiri, the man with the mark of the devil on his forehead ............. go down to eight mile and get a few lap dances, it will make you feel better - if you want, i will come along ........... here again, i agree with you that the dancers should be nationalized - after all, they are a national treasure !

Re: # 54

I do not belive in the capitalist propaganda that nationalized institutions are always corrupt and bad. All around the world, government take steps what is best for their citizens. That is why we see universal health coverage run successfully by Canadian government and almost all of Western Europe.

In Pakistan failure was because of a bloodsucking lawless class who consider itself above any law. In 58 years of Pak history not a single government has ever been accountable to the people of Pakistan. They consider the wealth of Pakistan as the milk of their mothers and pakisatn as their personal fiefdom. When we will establish a government that will not rule people of Pakistan but serve the people of Pakistan, and people of Pakistan will know that it is their country and its wealth is their wealth they will chop the heads of those who even think of being unaccountable to the people. That will be the day when a police wala will address a tongawala as ``Janab` and not as ``oye maa yawway aidhar aa``. THis is our destination. In order to get to this destination we will have to eliminate the ghulamzaday and haramzaday left by british and propped by neo-colonialsts.

Re: # 46

urstruly,

``Since interest and Riba is haraam, the institution of banking will be replaced by a federal government financial institution that will be called Baitul Maal or People`s Treasury. Initially, it will contain all the liquid assets that are currently owned by by all national and private banks. `` .................. so you are proposing that we nationalize the banks (once again) but this time put maulvis in charge of the ledgers instead of clerks and babus ? ......... so we get rid of competitive commercial banks and replace them with yet another government run agency run by corrupt officials - how will that make things better ?

............. like i said, the bearded classes keep on wanting to reinvent the wheel instead of simply accepting the fact that a round wheel is better than the triangular design suggested by primitive bedouins ............

........ and you must really think that everyone is stupid when you say: ``These loans will be absolutely interest free, that is, Qarz-e-Hasna. However, the borrower will have to pay back the loan in a fixed time (it may be in installments) with a mark-up that would be equal to the rate of inflation for that period. In addition, borrower would also pay the administrative charges (which will include the wages for those who administer the loan process i.e. baitul maal employees etc).``................ that is exactly what my bank in pakistan does today when they pay me the ``profit`` - the profit just happens to be pretty close to the goinng interest rate ................. remember, inflation + admin charge is still interest regardless of what you call it ............. all you are doing is putting lipstick on a pig and trying to pass it off as a horse ......... shame on you !

Re: # 47 rf786

Every chartered bank must establish a reserve with state bank, that must equal rupees to rupees with customer`s deposits. That is how a bank qualifies for running business in the country. State Bank keeps the checks and balance in this regard. So I am not talking about customer`s deposists to be used as a pool of funds to run the welfare schemes. Instead I am talking about putting all the liquid reserves into circulation. You should calm down.

It is a tragedy of our day that as people hear the word `Islamic`` with anything they become trigger happy and start shooting in the air mindlessly. Islamic welfare state is inevitable. In such a tightly knit world where even a man living in a shanty town in Bhai pheru can see on his TV that there are countries out there where even dogs have health insurance whereas he is being forced to feed larvae ladden water to his children, then it is just matter of time that he will come out with guiloutines. The wave of social justice and economic equity of people is blowing in full swing in South America, while the testicles of global neo-colonialism is tied with posts in Iraq and Afghanistan. Once people have the power, it is hard to take it back. In Pakistan, the corrupt oppressive class with their guns tanks and F-16s; and half a million military goons and a dedealy police force can oppress people for only so long. The attitude of this oppressive class is evdent on this website where they will do anything to distract people from their destiny. But it is written on the walls that all walls of oppression will eventually crumble.

An ideal situation is that this oppressive blood sucking class relents its hold on state resources volunatry and a mgna carta like social contract gets establish volutarily without blood letting, but unfortunately that will only happen when pigs will fly and fish will ride bicycles. The other way is the revolution with gloutines and every day is bringing us closer to that day.

Re: # 41

Zeemax:

``Japan reduced interest rates to zero and has maintained it at zero since a few years. But even zero rates are still interest rates in an overall interest rate regime....

So why do the banks continue to loan money. Whats going on?

Quite realistically, many people reject the interest-free system outright because it is difficult to believe the people in the 7th century knew about the vast implications of an interest based regime...

Interest has been historically seen as an intrinsic evil. So it is not just the Quran which condemns the practice, but the Torah also. Roman law also introduced penalties against the use of compound interest.

Re: #48 by rf786

Morally we suffer from selective amnesia....

Maybe others do. Maybe even others who take the same line as me do. But I would like to think that I don`t. I agree that there are other problems within our societies that need to be addressed. I agree that corruption needs to be tackled. But that doesn`t mean that I should turn a blind eye to this type of exploitation. Does it?

I could not get the actual text of the Al-azhar fatwa itself, although I got a few news reports. If you have a copy let me know.

Meanwhile you did not answer my point on the Quranic verse.

Thanx

Musa

Re: # 46

.......... and pigs will fly !........... why, some of them might even be able to make it to the eighth heaven, thus breaking the previous record held by a flying horse !

#46 by Urstruly on June 10, 2006 9:20pm PT
what you are advocating is social justice, we don`t need islam for that, europe did it with social democracy. there is no reason why islamic and the third world can`t do same, infact some are already doing it, i.e south korea, malaysia.

I have been tracking this islamic finance business for the past 16 odd years ever since Malaysia started on the sukuk bandwagon. Financial Institutions love this, its a one way bet, nobody loses. Across the arab world, you get what is called as non-interest bearing deposits. One way bet, you cant lose, you take in the money from people who dont want interest and loan it out. Which is the reason why you have strange liquidity sinks and peaks in the middle east markets.

ALL justifications given by the sharia boards are pure unadulterated BS. And I mean ALL, no exceptions. So if an instrument is publicised as sharia compliant, immediately know that they dont know what the heck they are talking about, each and every financial transaction is either interest bearing or has elements of explicit risk involved. It is all a way to make money out of the faithful. Then again, its the same with the ``socially responsible investment``, you are paying for your consience in that case, and in case of these islamic instruments, you are paying for your faith. Best of luck.

Re: # 39
Dear Musa,

Al Azhar fatwa on Bank interest is available on the internet, google.com zindabad. As for Dr Fazlur Rehman`s take on modern day banking, well he has tried to explain Quranic injunctions in detail going into their background and ill-effects on the general population. Basically, his argument is the same ie any social inequilibrium caused by evil practices such as charging of exorbitant interest rates, exploiting the needy, enslavement of entire families because of non-payment, depriving people of their basic rights to feed their families, all such acts go against the basic ethos of Islamic social justice and need to be resisted and opposed.

Rule of law by any court if not respected is meaningless, no matter if it is a Islamic injunction or by the military. Country`s with strong legal systems where write of the state is administered have demonstrated a much better human rights record in terms of society and economics. Take the example of Germany and Japan, both countries suffered huge losses in terms of people and capital post world war II, both were held responsible thus forced to pay damages to the allied countries. So why have they succeeded where many have failed? Two reasons (1) Good leadership which followed rule of law, respected their constitution and worked for the benefit of their people (2) No defense spending, both countries by law could not maintain their own armies. Point being, doesnt matter whether its religious doctrine or man made system, its as good as the people who manage it.

As for the comment on Pakistan debt, well these were supposed to be invested into projects which should have repaid these debts ie they should have been productive. What can the international lending agencies do when you have corrupt leaders and its people dont care cause they too are getting rich, who cares what happens to the country. Yeah, it makes good headlines, once in a while we can all get together and lambast these crooks, but tell me honestly, has it ever bothered anyone why we still have 250,000 Pakistanis stranded in Bangladesh? Morally we suffer from selective amnesia, we like to talk big on Islamic piety yet offer no real solutions and in our real life we ignore or embrace social norms which are to our benefit.

Instead of trying to reinvent the wheel Pakistan and its poor 150MM will be served better if we could provide them with economic relief, enough of this religious hypocrisy it does not feed their children niether does it provide them with a better future.

Re: # 46
You may not be describing a society on mars but sure do sound like an alien from a planet millions of light years away from earth.

Islamic Govt? Govts are made of ppl, flowery words are excuses for totalitarianism, exclusion of minorities, no room for dissent. Where do u see Islamic society in Pakistan or this world or when was the last time one was sighted?

Liquid assets currently owned by National (??) and private banks? Abay jahil, jub putha na huwa karey tho muth bola kar. These liquid assets are loans granted against CUSTOMER deposits. Banking ki abcd aathee naheen aur challay hein lecture denay.

Care to expand on the concept of inflation? why dont u be honest and say LIBOR ie London inter bank offer rate, cause thats what all the Islamic banks are doing.

If there is a malignant tumour in our society it is in the form of semi-literate maulvis parading themselves as all knowing pure breeds, in actuallity they are good for nothing power grabbers including the Taqi Usmanis of this world.

The first responsibility of Islamic government in the Islamic Republic of Pakistan will be to make arrangements and establish policies that are conducive to and facilitate the people of Pakistan to earn decent and honest living which is called Rizq-e-Halal. In order to achieve this objective we will have to eliminate the bloodsucking social class that has lost its fear of God. Those who do not fear God are the enemies of God and His people.

Since interest and Riba is haraam, the institution of banking will be replaced by a federal government financial institution that will be called Baitul Maal or People`s Treasury. Initially, it will contain all the liquid assets that are currently owned by by all national and private banks. The role of institutionalized lending by any private or government institution, in the present day sense, will be abolished. THe trillions of rupees currently owned by these banks will be loaned to people who would want to establish a business. These loans will be absolutely interest free, that is, Qarz-e-Hasna. However, the borrower will have to pay back the loan in a fixed time (it may be in installments) with a mark-up that would be equal to the rate of inflation for that period. In addition, borrower would also pay the administrative charges (which will include the wages for those who administer the loan process i.e. baitul maal employees etc). In other words a bank in Islamic republic will be absolutely non-profit. For loans upto Rs. 500K no collateral in fixed assets will be required. However, there will be stern process in place to deal with defaulters. A network of collection agencies, run by federal investigators will be establihed. The Baitul Maal will be required to publish a monthly financial statement, which will have absolutely no hidden or secret line items. The list of borrowers will also be publihed periodically along with their borrowed money figures. Since, the money lended is from Peopl`s treasury, therefore, confidentiality clause will not apply. This pool of funds will be replenished with a part of state revenues annuallyand partially through zakat and usher funds. The bulk of zakat and usher funds will be used for pension for all Pakistanis of retirement age, every child will be given a state stipend from the day she was born until she will reach the 16 years of age. Education for every child in Pakistan will be free upto Secondary school. Every jobless Pakistani will be given unemployment allowance for 12 months and he will be loaned (interest free) to continue his higher or vocational education. Unemployed will be given preference for businss loans.

I am not describing a society living on Mars; almost every Western country has established this welfare state in their country. Pakistanis have to make a decision today, whether they want this achievable dream materialize in their country or they wish to continue their misery under the oppression of a corrupt, amoral, and bloodsucking class. There is absoluetly no other way to our freedom without eliminating this malignant tumor festering among us. It is now or never.

Re: # 44

........ the question is why doesn`t potohar have the capital ? ............ as far as i can tell, taxila has been around a lot longer than atlanta

.......... but you are partly right about stuffing dollar bills into g-stings - it is a waste of money if you can`t expense it ........ but it has got nothing to do with humanity and all that - it simply means that those fine women are good business women and don`t want to waste their time hanging out with guys who don`t have the money to pay for a dance ..........having said that, dancing is an honorable profession unless you run across the duke lacrosse team ........

........ the thing that bothers me about muslims, and other primitive people, sitting around and criticizing the current economic system is the fact that they can`t point to a viable system that has ever worked - now, or in the past .......... and for mo`s sake, don`t talk about the kulafa-i-rashideen who presided over a city state that filled its coffers by plundering its neighbors and stealing their camel and women ........the fact that three of them got whacked tells you something about how clever these guys really were !........... the socialist experiment too has failed, and i don`t see anybody else coming up with anything else in the forseeable future ........... everyone, including the commie chinese and the horrible hindoos, is jumping on the bandwagon and making a buck while the muslims are busy whining about the ``system`` and contemplating suicide ..........

#43 by hamidm2

Hamidm all I`m saying is that US sucked up Hamidm from Potohar because it had capital while Potohar didn`t, otherwise Hamidm would be advising some Potohari company on increasing productivity. That`s all. After all, it`s the same Hamidm ... isn`t it? Whether in US or potohar. It was not because of any conspiracy ... it was only how things turned out. But it was a shame. Hamidm would be happier I think .... as would be Potohar.

I have a question.

I loved tucking up dollar bills in g-strings in Atlanta (boy what knockouts) not to mention other parts of the world (but Atlanta was the best), but somehow they would all drift away to the next guy when I ran out of dollar bills. So I carried more the next day, and still more the next, but they kept running out. And I had mortgages to think about so thought I couldn`t compete with the next guy, and the next, and still the next, and so forth. I was running like a rat on a carousel with no end in sight. Didn`t want to be a rat. Neither did I want to be a utilitarian nor a phillistine. So I decided that dollar bills turn humans into illusions and deprive them of humanity...unreal and unattainable.

Was I wrong?

If you say I was wrong, I`ll join you back on the stripper strip!

Re: # 41

zeemax,

``Perhaps the 7th century people did know what they were talking about`` ....... is that why they lived in a tent with their sheep while their wives slept outside in the rain ?

``persons with capital and persons with productive skills must be `partners` `` ......... sounds a lot like the union/management partnership bs, doesn`t it ? ......... all around the midwest wherever you see a uaw logo along with the company logo you can be sure they are going out of business ........... on the other hand, all across the south, the japanese and korean capitalists are going it alone without the damned uaw getting in the way and everyone is happy .......... sam walton would have made his money with or without the half-wits handing out flyers for fryers at wal mart ........... and i hope to god warren buffet doesn`t `partner` up with engineers, insurance salesmen and bitheads ......... if he does i am selling my brkb shares !

``Uncle Sam is great only because it first sucked in all the world capital`` ......... you mean to tell me that the chinese and the rest of the world are deaf and cannot hear that big sucking sound ? !...........how do you suck capital, through a straw ? ......... do you mean to say that the us is what it is simply because it has looted all the capital in the world and then drained all the brains from botswana and the republic of chad to put them to work on plantations in the silicon valley ? ........ who would have thought - slaves driving bmw`s and sipping napa wines !

........... heard any other conspiracy theories lately ? ......... how about the one that the us is causing global warming because it hates penguins ?

#35 by bbabu

There is something called ``gold standard``. America followed it until 1971. You do not need an Islamic economic system for this. A lot of you dudes suffer from NIH (not invented here) syndrome.

You`ll find the answer for this in the post below.

Rgds

Oak,

But if we are to consider the abolition of interest we may have to bring it about by gradually reducing the interest rates purposefully in order to abolish it. At this stage we ought not rule anything out.

Japan reduced interest rates to zero and has maintained it at zero since a few years. But even zero rates are still interest rates in an overall interest rate regime. Thus it can only be abolished, not reduced gradually.

But as for partnership requiring pooling of hard funds we could say that banking or governmental institutions ought to be able to step in.

Yes. That`s exactly the point of Islamic mode of finance (not banking) that persons with capital and persons with productive skills must be `partners` in keeping with the egalitarian spirit of Islamic Society, rather than a sytem whereby those with productive skills are left at the mercy of a few controlling the capital alone and with no other skills. Islam seeks to remove that anamoly.

Why is there a brain drain? It`s only because productive people cannot excel in a capital deficit society, but the same do well in places where capital is surplus ... e.g. USA.

Uncle Sam is great only because it first sucked in all the world capital, and then all the world brain. At first it siphoned-off capital through high interest coupled with the gold standard where other nations thought all the dollars they had were backed by some gold bars in fort knox, but when they found out they were cheated, Uncle Sam just abandoned the gold standard and introduced floating exchange rates, again manipulated by interest rates, because by then dollar was the reserve currency anyway and others had no choice but to buy dollars .... gold-backed or not. So the world capital remains with uncle sam and finances its deficits.

Quite realistically, many people reject the interest-free system outright because it is difficult to believe the people in the 7th century knew about the vast implications of an interest based regime for a sophisticated economic system of today, which is why it was opposed by them so vehemently. But quite apart from the religious edict, an interest-free system is indeed vital towards an egalitarian society.

Perhaps the 7th century people did know what they were talking about.

I.e. Hamidm`s crusades notwithstanding ...)

......... is it okay to take a leak standing up ?

...... this, along with riba and other burning questions like whether women on the rag should be allowed to pray, are discussed ad nauseam by the brialliant ummah while they continue to squat by the roadside and then get up to watch the traffic with one hand inside their shalwar ! .........sometimes one feels like walking up to them and slapping them in the face to see if they will let go their pants !..... wake up !.... wake up, you fool! ........ you have no right to talk about business and commerce and science and technology, because you haven`t contributed anything to any of these things in the past thousand years !........ if it weren`t for white man and his machines you would stilll be sitting on top of all that oil pounding sand and waiting for the next prophet ........... you have no business talking about banking and interest and financial markets because, at the best, you are a nation of petty traders who can get by with elementary barter trade : six goats for a camel and a fifteen year old virgin for two camels and a basket of dates ........... that`s all the economics you need to know ........... what do you care about mortgages and private equity financing when all you need is a tent and a sheep to keep you company !

............ leave this stuff to people who have indoor plumbing and use utensils to eat their dinner !

p.s. now i feel a lot better !

Re: # 36

rf786

.....edicts issued by Azhar University which voted 21-1 in favor of Banking interest rates stating it was not Riba. Islamic scholars such the late Dr Fazlur Rehman has written in detail differentitating usuary as described in the Quran and interest rates as practiced in the modern economy.

I would request you to quote your sources so that we could discuss this further. I would be interested to know Fazlur Rehman`s take on the issue. If you could get a copy of the text of the fatwa itself, or its main conclusions, that would also be revealing.

But generically, I believe this idea was first taken up by Muhammad Abdu at the turn of the last century so it is not a new idea. One could sit and debate about specific transactions all day. But the contemporary form of compound interest, used in modern finance, is certainly forbidden in the Quran (3:130):

In the name of God the ever Gracious, the Merciful:

``O ye who believe! Devour not usury, doubled and multiplied; but fear Allah that ye may (really) prosper.`` Yusuf Ali

``adaa`afan mudaa`afatan`` means doubling or multiplying upon itself. It refers to the riba i.e. the usurious amount rather than the principle. Therefore one could not escape this by saying as long as the principle is not doubled than that is fine.

The other point is that transactions which have been allowed e.g. in Pakistan do not seem to exploit the debtee any less. Therefore one could argue from the point of the maqsad of the Shariah that it is forbidden.

Quoting debt numbers without describing their background fails to explain their reasons and seems to be a deliberate attempt presenting one side of the story. Fact is, much of this borrowing has been used to fund projects in Pakistan, now the issue here is whether those funds were properly utilized or not?

But the poor people of Pakistan are paying for it. And continuing to pay for it. And the riba, except in a nominal way, is not relieved from them.

What you are telling me is that a deal was done by the corrupt classes of Pakistan and the worlds financial institutions to mortgage the future of the people of Pakistan. I don`t see how the financial institutions can avoid responsibility.

JK

Musa

Re: # 29

Zeemax

Regarding interest and growth, let`s take the recent example. Below is the unemployment rate in the USA.........It just manipulated interest rates to achieve growth. It is actually nothing more than creating a `self-fulfilling prophecy` through artificially inflated wealth. This, in essence is what Islam prohibits i.e. creation of wealth from thin air without the backing of tangible and intrinsic value.

I see what you are getting at but first lets deal with a small hurdle. If Uncle Sam reduced interest rates to increase employment that has a net effect of economic redistribution then fine. Teriffic. Reduction of interest to achieve a result. What`s wrong with that.

I understand where you are coming from: that the manipulation of the interest rate to achieve economic objectives creates an artificial economy. But if we are to consider the abolition of interest we may have to bring it about by gradually reducing the interest rates purposefully in order to abolish it. At this stage we ought not rule anything out.

Your points re partnership, raising funds from stock markets etc are fine at a micro level, but partnerships require pooling of hard earned funds and cannot be leveraged, thus slow growth only from reinvestment of profits; while cheaply borrowed money can not only be leveraged but also independant from need of profits for investment. Thus fast growth.

Surely that is because of the system that has been put in place. In this particular system interest acts as a motivator for resource allocation. We can devise alternative motivators. I am skeptical of the make up of the current stock market because that leads to speculation rather than investment. But as for partnership requiring pooling of hard funds we could say that banking or governmental institutions ought to be able to step in. And as for interest being independent of the need of profits we could say that interest by its very nature requires a level of profit higher than the interest rate. Otherewise there would be no motivation to take out a loan.

But people want fast guarenteed cash, they don`t want to engage with society to work on a wholesome prosperity.

Your thoughts?

Musa

rf786 #36

`` Writer usage of the word riba for bank interest rates or those practiced in capital markets ignores edicts issued by Azhar University which voted 21-1 in favor of Banking interest rates stating it was not Riba. Islamic scholars such the late Dr Fazlur Rehman has written in detail differentitating usuary as described in the Quran and interest rates as practiced in the modern economy.

Quoting debt numbers without describing their background fails to explain their reasons and seems to be a deliberate attempt presenting one side of the story. Fact is, much of this borrowing has been used to fund projects in Pakistan, now the issue here is whether those funds were properly utilized or not? We all know of the corruption in Government and general public including our honorable sharia benches, it was not interest rates or capital financing which caused ballooning of debts but human corruption. ``

Corruption doesn`t exist in the land of the pure :-)

Writer usage of the word riba for bank interest rates or those practiced in capital markets ignores edicts issued by Azhar University which voted 21-1 in favor of Banking interest rates stating it was not Riba. Islamic scholars such the late Dr Fazlur Rehman has written in detail differentitating usuary as described in the Quran and interest rates as practiced in the modern economy.

Quoting debt numbers without describing their background fails to explain their reasons and seems to be a deliberate attempt presenting one side of the story. Fact is, much of this borrowing has been used to fund projects in Pakistan, now the issue here is whether those funds were properly utilized or not? We all know of the corruption in Government and general public including our honorable sharia benches, it was not interest rates or capital financing which caused ballooning of debts but human corruption.

Monetary policy has been instrumental in developing German, Japanese and todays Chinese economies with great success. Referencing failures that too of Islamic states should reveal more of the people than the system.

zeemax #29

`` Regarding interest and growth, let`s take the recent example. Below is the unemployment rate in the USA:

Unemployment began to creep up from below 4% in 2000 to 6.4 % in 2003. The US cut interest rates in response from 6.5% to 1% by June 2003. That created an asset price boom (stocks, real estate) and people started to `feel` rich because of their increased equity and HamidmJi tucked more dollar bills in his stripper`s g-string. The economy grew and the unemployment as of last month was 4.6%. The US didn`t perform any miracles. It just manipulated interest rates to achieve growth. It is actually nothing more than creating a `self-fulfilling prophecy` through artificially inflated wealth. This, in essence is what Islam prohibits i.e. creation of wealth from thin air without the backing of tangible and intrinsic value. ``

There is something called ``gold standard``. America followed it until 1971. You do not need an Islamic economic system for this.

A lot of you dudes suffer from NIH (not invented here) syndrome.

`` TVM, inflation and interest are the terms used in capitalistic system. These terms do not exist in Islamic economic system. ``

Do you believe in paper currency ? If you print too much paper currency and produce too little goods/services you have inflation. Interest rates are meant to offset inflation. Not the other way around.

`` Lets take communistic economic system. The terms you have defined are non-existant in communistic system. AND yes this system is thriving ecen today and lending about $500 million to the best capitalistic society of the world. Talk to a Chinise and ask him about these terms. ``

China is not communist. It is giant low cost production base for MNCs of the world. If you think China is great please emulate them.


`` On the same issue, I like to be a little sarcastic at this point. Pointing fingures to others religion is very easy.

Clean up your own closet before looking at others. Swami Shardananda said this to all Hindus.

I hope you know who Swami Shardananda is?

Can you even name all your sacred religious books? ``

Religion is for deciding what is right and wrong. It is about ethics, morality. Religion does not decide economics, science, technology and political science. You are free to disagree.

How many pages is the Quran ? Do you know how many pages of research in finance/economics exist ?

zeemax #14

`` Just for the sake of argument, China did it for 50 years ... didn`t it? So it can be done if really necessary. ``

When did Chine close for 50 years ?
They have extensive trading relationship with Soviet Union until mid-1960s. No one in China looks fondly at the Great Leap Forward or the Cuktural Revolution.

`` I don`t see it as a problem. It is forbidden in Islam, and for good reason. Without interest, there can be no inflation. Trouble is there can be no growth either as far as the modern economic theories go. That in my opinion is the real point to ponder i.e. how to achieve growth in a non-interest-based economy. Not how to keep relations with the rest of the world because there isn`t any. ``

Inflation is related to money supply and supply of material goods. Interest rate exists because of inflation. It is meant to offset your losses due to inflation.

... what`s wrong with interest ?

.......... today anyone with half a pea for a brain can go out and borrow money at 1.9-2.9%, put it in a money market account at 3.9-4.9% and make 1-2% just like that ............. now what is wrong with this picture ?

........... sometimes smart people think too much and worry about all sorts of silly things that could-would-should happen ......... the simple minded guy just does the obvious and whistles merrily past these imaginary graveyards ......

...... nowdays a lot of peoople are worried about the interest rates going up .... why? what the heck did they do when interest rates were low ?........... my guess is that as far as these folks are concerned it doesn`t really matter one way or the other - they are just chronic whiners who can`t figure out which way is up because they say stupid things like, `` well up is a relative term depending on your position in relation to the object being observed``....... now that is genius ! ........... as far as a common (and simple) man is concerned, interest is a good thing one way or the other - if it is high you lend it, if it is low you borrow it ........ that simple, really ......

Re: # 29

zeemax,

.......... i also tucked some bills into warren buffet`s underpants; put some money into the emerging markets dhotis, kimonos or whatever it is that they wear over there; gave some money to bob the carpenter and his alcoholic cousin, the electrician, to remodel my kitchen and finish my basement; gave some money to bill gates so that he could put some more bugs into his software; stuck some hundred dollar bills into steve job`s jeans by buying the minis and nanos and then replacing them when they got stolen (i don`t hold a grudge against the slacker who stole them - we wouldn`t have this problem if the government issued them along with food stamps and cheese !); and with the money i gave bob he bought a nano for his kid while his cousin supported the mexican economy by buying many many bottles of cuervo gold (i call that cross border trickle-down); ........... then they jacked up the interest rate on my home equity loan which had financed all this economic activity ......... but no need to panic ! ...... i just called up all those nice bankers who keep on sending me those little plastic cards and they promptly gave me loans at 1.9% ........ now, since i am sure that warren buffet can do better than 1.9% i am still happy even though interest rates are climbing up and the sky is falling ........

............ but i must admit, of all this economic activity the most enjoyable is stuffing dollar bills into g-strings ....

This has all been done before...Nabendu whatsisname wrote a piece on Islamic banking not that long ago and it had the same ole same ole.

Running out of topics are we?

Oak: {Growth is dependent upon productivity not interest.}

Urstruly:{So I think, growth is possible without making money from money.}

Regarding interest and growth, let`s take the recent example. Below is the unemployment rate in the USA:

Unemployment began to creep up from below 4% in 2000 to 6.4 % in 2003. The US cut interest rates in response from 6.5% to 1% by June 2003. That created an asset price boom (stocks, real estate) and people started to `feel` rich because of their increased equity and HamidmJi tucked more dollar bills in his stripper`s g-string. The economy grew and the unemployment as of last month was 4.6%. The US didn`t perform any miracles. It just manipulated interest rates to achieve growth. It is actually nothing more than creating a `self-fulfilling prophecy` through artificially inflated wealth. This, in essence is what Islam prohibits i.e. creation of wealth from thin air without the backing of tangible and intrinsic value.

Your points re partnership, raising funds from stock markets etc are fine at a micro level, but partnerships require pooling of hard earned funds and cannot be leveraged, thus slow growth only from reinvestment of profits; while cheaply borrowed money can not only be leveraged but also independant from need of profits for investment. Thus fast growth. It does concentrate wealth in a few hands, as well as creates bubbles from time-to-time which when burst, leave the disinfomed holding the bag, but that is the trade-off as of now for `prosperity`.

Oh well .. anything to keep Hamidm happily tucking away greens on eight mile ....

Cheers!

Maulana Urstruly (pbuh)

(But in either case the business enterprise pays back earned money back to financial institutions as interest or it pays dividends to its shareholders. In the first case the payback goes into the pocket of select few and in second case a large segment of economy benefits. )

Not really. Companies can also borrow from the bonds (publicly placed) market in which case the society can participate at large. Then again you must remember that when a company pays interest to a few institutions, these institutions in turn pay interest/dividend to debt/deposit/shareholders who are public at large. OTOH very often equity investors are a closed group- privately held companies, private equity, few large individuals etc.

(In the first case, the payback is a must, no matter how the business does; so the business owners are under constant negetive pressure to perform well - and if need be lying and cheating, and cooking the account books is a inevitable, as we have seen in the Enron case; where not only the business managers but also the financial institutions robed share holders of their money in complacence with each other. But in the second case not only profits but losses are also shared. Since a large number of people have stake in the enterprise it is harder to cook books. )

It is more likely that books would be cooked to fool equity investors as these investors are more interested in profit fugures. Debt holding institutions are more inclined to look at cashflows and asset cover rather than just profits. In my opinion, FIs/banks being large organisations are more difficult to fool unless they intend to get fooled or ripped off in any case.

Regards

Oh boy! here we go again.... the entire world has moved on... and still the dumasses are splitting hairs on sermons given in some 7th century book....

geez Einsteins!!! why don`t y`all join Taliban in reviving your Utopian kingdom in Afghanistan and spare us all from your stupid existence in western lands....

Re: # 19 asfand,
Let me give you a lesson that might not be in your book but it might be a revelation.
The communist system you talk about certainly does not exist in china. Its a totalitorian and autocratic government in china. You emphatize with it and just like your religion you cannot discover its true nature of the beast.

urstruly,

`` know it will drop many jaws but I think the institution of bank as a lender has no role in interest free economy`` .........

.......... my jaw would actually drop if you told me that you don`t have a mortgage and still live in a trailer park after years of toiling for the man .......... i also assume you keep your money in a tin can under your bed ......... the economy IS interest free - nobody is forcing you to pay or take interest .........

Re: # 23

But are fertilizer bombs allowed in this cult ???
I thought beheadings were halal ....

but then u know .... most things that are unmentionable are legit here ...

#22 by mohar11

>>>>And what are you doing in sacramento anyway? I mean - that`s dar-ul-herb[land of kafir]... isn`t that against the laws given in koran? how are you going to implement laws given in koran living in kafir land under kafir system?...<<<<<


And how do you know he is not working on his plans to implement this politico-socio-economic system in the kafir land?

he is learning how to build fertilizer bombs and is in touch .......with his brethern in Toronto:-))

Re: # 20 asfand
[...And thanks for pointing that we Muslims read Quran many times a day....]

You are welcome....:)))... So how long is it going to take for you guys to fully understand the laws given in koran and implement ``the alternative politico-socio-economic system``?... Any guesstimate on the timeline?... couple of years or decades or centuries?...

And what are you doing in sacramento anyway? I mean - that`s dar-ul-herb[land of kafir]... isn`t that against the laws given in koran? how are you going to implement laws given in koran living in kafir land under kafir system?...

Reply to Number 13

``Re: # 12 oak
[...Islam is by its very nature a Faith which looks forward not back....]

LOL... I actually laughed out loud when I read that.... Tell me you are kidding.... :) ``

This is what I call RSS/BJP mentality. Check RSS/BJP website. They claim that Islam is a stagnant religion. How wrong they are.

Yes Islam is a progressive DEEN not a religion. Although we use the word interchangeabily but the two words have different meaning. Islam is a Deen meaning besides basic faith and rituals it provides an alternative politico-socio-economic system. No other religion does that.

Asfand Siddiqui

Reply to Number 11

``How long do you think it will take?.... I mean - it`s just one book and you guys have been reading it from page to page 5 times a day, everyday, for all your lives.....

But keep trying.... someday you will find out the bitter truth... that the book has no answers to your problems... the book is obsolete, has been so for a very long time....``

Oh Phaleeeeeeese

Lets not worry about Muslims. Go mind your own business. Read your own religious scriptures and stop trying to point fingures at others. Clean up your own closet before looking at others.

What Muslims are trying today is to implement laws given in Quran. Most of the debates you see or hear are about ``trying to understand Islam`` is about implementation. Basic faith matters are very well understood among Muslims. And thanks for pointing that we Muslims read Quran many times a day.

Asfand Siddiqui

Reply to #5 bbabu

We are in the 20th century. To ban interest is to miss the time value of money. We are in the era of printed money. There is inflation.

TVM, inflation and interest are the terms used in capitalistic system. These terms do not exist in Islamic economic system.

Lets take communistic economic system. The terms you have defined are non-existant in communistic system. AND yes this system is thriving ecen today and lending about $500 million to the best capitalistic society of the world. Talk to a Chinise and ask him about these terms.

Similarly Islam provides another alternative to Capitalistic economic system. The terms you mentioned are non-existant in Islamic system too. Quran provides a frame work for a just economic system. What Muslims of today needs to understand is the implementation of the Islamic economic system. Thats what I meant when I said that Muslims of today are trying to understanf our religion better.

On the same issue, I like to be a little sarcastic at this point. Pointing fingures to others religion is very easy.

Clean up your own closet before looking at others. Swami Shardananda said this to all Hindus.

I hope you know who Swami Shardananda is?

Can you even name all your sacred religious books?

Asfand Siddiqui

Re: # 12

> Islam is by its very nature a Faith which looks forward not back ....
So you guys are not stuck in the 7th century .....
Is that why your species .... is soooo famous for innovations in all fields.... ? (except
probably how to kill infidels ...)

No wait. Don`t answer that.

Re: # 14 Zeemax

Janab

Well, in Islam, there is no rest of the world. It is only Islam or nothing.

I cant agree. What about (bismillah) ``lakum deenukum waliya deen``? For you your faith and for me mine. This indicates an acceptance of the plurality of religions and worldviews. Nor could we say that Islam is isolationist in practice. There is the tradition of the Prophet after the conquering of Mecca that he went to procure armaments from a mushrik. The mushrik thought that he had come to take his weapons by force. But the Prophet (saw) asked for a price and gave the money to hand. Therefore engaging in economic barter with non-Muslims is certainly not prohibited. There will be many other examples and this is just one. As far as I am aware the Muslims were boycotted against, they themselves did not boycott.

But as for riba based deals you could say that Muslims ought to have no part in it. They should close themselves off from that aspect completely. Good. I agree. But that is not the practicality. Consider the scenario:

A Muslim comes to a Western country. He gets a job, settles down, lives a nice life. He marries, has a nice wife & 2 kids. Now he needs a house. He could either a) rent, b) get a mortgage. He can rent for say £1000 a month or purchase the property for £100,000 with mortgage payments of the same. If he takes out a mortgage he will end up paying £150,000 i.e. £50,000 too much after 12.5 years but still have property worth £100,000. Or he could have paid £150,000 with nothing to show for it.

Now in a non-riba based economy this would never happen. House prices in the West are inflated by the availiability of mortgages and future interest payments and it is a mad spiral circling out of control (in London at least). In a non-riba based economy house prices would be based upon basic supply & demand, so what people would be able to pay for would have more impact. House prices would become affordable. But in the scenario I have not considered inflation & increase in house prices which would only exacerbate the situation. So you can`t get a house for £100k in London.

Now given that the maqsad of the shariah is to prevent exploitation than it is arguable that the Muslim is being more severely exploited by the riba-based economy by not procuring a mortgage than by actually procuring one. Right? And this is exactly what some western Muslim scholars, such as Hamza Yousaf, have argued.

So how can Mr X not engage with the riba based economy. It is catch 22. This is, I think the import of the hadith If he does not devour it, its vapour will overtake him.

This is the problem that we have to think our way out of. And it is a problem. Look at Pakistan. I made those points in the article, so I dont need to go over them, but as I had concluded: The country is left running the mouse wheel in an attempt to get out of the rat race.

Re:

the real point to ponder i.e. how to achieve growth in a non-interest-based economy

Growth is dependent upon productivity not interest. I understand what you are saying that interest is a scheme for diverting resources to producers & enhancing productivity. But surely other schemes e.g. partnerships or government subsidies could be devised. Surely that is far from an impossibility.

Just as long as they don`t fall into the `ijara trap`.

Cheers

Musa

#14 zeemax

Could you please define ```growth`` and how it is not possible with an interest free economy?

The way I understand it is that, a business enterprise has two ways to raise capital for growth and expansion. One, it borrows money from a financial institution and second, it floats its shares in open market or forms partnership. As a matter of fact all modern business use a hybrid of these two methods. But in either case the business enterprise pays back earned money back to financial institutions as interest or it pays dividends to its shareholders. In the first case the payback goes into the pocket of select few and in second case a large segment of economy benefits. In the first case, the payback is a must, no matter how the business does; so the business owners are under constant negetive pressure to perform well - and if need be lying and cheating, and cooking the account books is a inevitable, as we have seen in the Enron case; where not only the business managers but also the financial institutions robed share holders of their money in complacence with each other. But in the second case not only profits but losses are also shared. Since a large number of people have stake in the enterprise it is harder to cook books. So any growth is actually a ``real`` growth and it is across the board. This is not an idealist talk. The Arab traders pioneered this concept and concept was taken up by early Europeans who institutionalized the practice and formed stock exchanges and trader guilds. Later the corruption and greed settled in and stockholders roles were made to diminish and interest banking treaded in. It was not the need that mothered this bastered child, it was rather greed.

So I think, growth is possible without making money from money. I see an extremely diminished role of of financial institutions and banks in an interest free economy and this really bothers the hustlers and soodkhors who are so accustomed to making easy money.

I know it will drop many jaws but I think the institution of bank as a lender has no role in interest free economy. However, financial institutions are still needed for funds management, for example, where money is made by making smart investing and not by hustling.

....... while you are trying to understand your silly religion, send me your interest payments from your banks and brokerages and i will keep it in a safe place ......... once you have it figured out i will either return what you sent me (without haram interest) or i will keep the money and spend it on beer and dancing women (since it was haraam to begin with) !................

............the strippers on eight mile have more sense than you guys - as long as the money is green they don`t mind it being stuffed in their g-strings ............ what a bunch of morons !

Oak,

Surely one of the principles of trade in Islam is not to seal ourselves off from the rest of the world.

Well, in Islam, there is no rest of the world. It is only Islam or nothing.

...economies are not closed, they are necessarily open. Surely one of the principles of trade in Islam is not to seal ourselves off from the rest of the world...

Just for the sake of argument, China did it for 50 years ... didn`t it? So it can be done if really necessary.

So we must look for a way out of this problem.

I don`t see it as a problem. It is forbidden in Islam, and for good reason. Without interest, there can be no inflation. Trouble is there can be no growth either as far as the modern economic theories go. That in my opinion is the real point to ponder i.e. how to achieve growth in a non-interest-based economy. Not how to keep relations with the rest of the world because there isn`t any.

Re: # 12 oak
[...Islam is by its very nature a Faith which looks forward not back....]

LOL... I actually laughed out loud when I read that.... Tell me you are kidding.... :)

Re: # 11

Mohar

When Asfand says ``we are trying to understand our religion`` he means that Islam is by its very nature a Faith which looks forward not back. In this context the contribution of Islam is to highlight the problem of riba which is a huge socioeconomic injustice perpetrated particuarly on the vulnerable members of society. Those who decry Islam are either blind to this phenomena or do not care. They should suggest their own alternative answers.

I mean, lets not forget that we had previously established that 300 million Indians live below the poverty line.

Re: # 4 asfand
[...We are trying to understand our religion..]

How long do you think it will take?.... I mean - it`s just one book and you guys have been reading it from page to page 5 times a day, everyday, for all your lives.....

But keep trying.... someday you will find out the bitter truth... that the book has no answers to your problems... the book is obsolete, has been so for a very long time....

Re: # 8

Zeemax

Both you and I are in agreement that riba was abolished via decree. OK. But we must be truthful and accept that riba has not been abolished by practice. Unless you can point to me an example of a contemprary non-riba based economy, which I think you would be hard pressed to find. One should say that such a time was also forseen by the Prophet (saw) who said:

``Hazrat Abu Hurairah r.a. reported that the Prophet (saw) peace and blessings be upon him said : A time will certainly come over the people when none will remain who will not devour usury. If he does not devour it, its vapour will overtake him`` ( Sahih Bukhari)

What interests me is any mechanism for abolition of interest because I felt that I could get upto this point and no further. So we both agree that charity is not, as it were, ``compensatory for interest``. Fine. So you say:

``there is no gradual mechanism or modality to abolish interest, but rather it was eliminated by decree following the shift in the entire conceptual perception of money.

It must however be noted that such a system can only be viable in a closed economy, with no need for reliance outside it. ``

But economies are not closed, they are necessarily open. Surely one of the principles of trade in Islam is not to seal ourselves off from the rest of the world. So we must look for a way out of this problem.

I appeal to market morality. You appeal to decree. But neither of these approaches are going to be taken up.

Musa

Muslims waste time, energy, effort and blood over the mediaeval laws of seventh century Arabia, while the rest of the world moves on.

Musa,

Good attempt to understand the Riba principle. Godspeed to you. My two bits:

The question arises as to whether this is a viable economic model.

If seen in the overall context of the Islamic Society, it is not only viable but a vital ingredient. Capital, in Islam, is not an asset of the individual but on the contrary a liability towards Allah as bestowed by Him upon His discretion, and accountable as for its use in the minutest detail. Therefore, it neither carries a time-value nor is it a factor of production carrying any `rent`, but rather to be used towards the best interests of society at large, in manners prescribed, by those upon whom it is bestowed.

The question as to whether a massive increase in charity would decrease interest rates

Interest in any form is not allowed at all. Period. Like your example of `Islamic Ijarah`, the Islamic `banking` in vogue is nothing but pure Munafaqat. This works by twisting the interpretation of the prohibition of pre-determined profit to mean that fixed interest rate is prohibited, but floating interest rates are ok because these cannot be pre-determined. Therefore, Liobor (+) Ijarah, Sukuk etc. are all considered Sharii which is stretching the definition to fit the purpose. Besides, Islamic products are more expensive because of the additional documentation required and legal risks etc involved in stretching the definition.

..it is far from clear whether charity is in itself the mechanism for abolition of interest...

Charity is the prescribed social utilization of capital. The use for trade and commerce is quite distinct and seperate and the two should not be mixed. Tthere is no gradual mechanism or modality to abolish interest, but rather it was eliminated by decree following the shift in the entire conceptual perception of money.

It must however be noted that such a system can only be viable in a closed economy, with no need for reliance outside it.

Rgds

Even the Western Banks are now jumping into this `Islamic Banking`. For pure coomercial reasons.

They get accounts of the emotional Muslims who wish to deposit the money with them & get no INTEREST.

they are only interested in sharing the Profit or Loss. So the Banks oblige them (Always?) with a bit of Profit. The same banks, when they loan out, they charge hefty `Service Charges` but take no interest.

Everyone is happy. The Muslim feels spiritual & the Bank makes money. Throw in some Arabic terms to make it all look authentic & religious.

it is a big hoax.

Unlike the RICH lenders of 7th century, now the lenders are millions of POOR people.

nhk

Request to Horrible hinoods,
Pls keep away from these matters .... I 200% support the abolition of interest from Pak dharti.

they should put it in action from this day and hour and minute and second .....:)

> We are trying to understand our religion. ...
Still ?

asfand #4

`` Yes Mohar

We are trying to understand our religion. Because we believe that a better understanding of our religion will make our lives better here in this world and in hereafter.

Asfand ``

In 7th century Arabia where was no state and no rules
it made perfect sense for a money lender to charge huge rates of interest.

What is a moneylender going to do when the borrower takes off to the neighboring kingdom ?

We are in the 20th century. To ban interest is to miss the time value of money. We are in the era of printed money. There is inflation.

Yes Mohar

We are trying to understand our religion. Because we believe that a better understanding of our religion will make our lives better here in this world and in hereafter.

Asfand

Yep - that`s what you pakis need to do right now - re-invent the wheel.... :)...

Riba, kafir, haram, halal.... The world has moved on - but pakis are still stuck in 7th century....the ``debate`` never ends...

Nice Article Musa,

This is an area that needs attention by Muslim Scholars, Econimists, Financial Experts, Bankers etc to look at the term ``Riba`` and compare it with current financail transactions. These experts should look at all the currect financial transactions and figure out which of them comes under the riba category and which of them are considered riba free.

-Asfand

the movement of Islam was in the time of Mohammad ( s.a.w ) & now has been anti-capitalist in nature - and has preaches the idea of social justice . Collection `Interest` or `Suud` is `haram` - as simple as that . Some Muslims or should I say most Muslims take intrest either by investing in governments national saving schemes which gives higher rates or interests or by mortgageing a house in west ( applies to brothers & sisters who lives abroad ) - these people mend the rules to suit there needs - while the book says something different .
As for my and my father(s) examples Alhumdullah, we had all our lives been away from this sin of interest - may Allah keep us and everyone away from this -