Archive for May, 2014

The innovation (bida) of Islamic Financial Products continues apace. Next in line could potentially be sharia compliant student finance…how exactly these will be structured is still up for question, however the main point here is that it will give the industry another opportunity to confuse the issue and to pull the wool over the eyes of another core segment of the muslim demographic – students.

Islam 21c’s Sheikh Haitham Al-Haddad, shows he, and many of his peers, only serve to assist the distorted understanding of ‘interest free money’ by calling for community members to show their support for this government initiative. He would do well to acquaint himself fully with theĀ  fiqh on fiat money and on riba itself, something one would assume a Sheikh of his stature would be familiar with. Perhaps he would like to become a Scholar for Dollars one day…

I would personally suggest he begin some serious dialogue with the likes of Shaykh Umar Vadillo, Tarek El Diwany and/or Dr Mustafa Ali of the Bandung2 movement.

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Commodity money is not the only alternative to the fiat based system. Where currently the banks have the greatest control over the supply of money, one suggestion put forward by the Positive Money group is to take this power away from them and rest it with an independent accountable committee.

Read their proposal here, written in easy to understand terms. A more technical guide also exists for more advanced readers. View the site below;

The Positive Money Alternative

Whilst it is worthwhile considering all work put forward in attempting to end this unjust system, and where no solution should seek to create a utopian world, the obvious problems with this proposal are as follows;

  • Fiat (non-commodity) money will still exist, albeit in a ‘controlled’ and debt-free form
  • How independent can any committee be, and the risk of manipulation will still be present from the government and parties close to the commercial banks.

However, some of the advantages are to be welcome, and work such as this greatly helps the discourse when it comes to theorising about an answer to the status quo.