05 Feb 09 Bank of Japan Gives Away Money Interest Free
An interesting opinion piece written back in December by William Pesek. If all central banks start offering zero percent on money loaned, it will raise many new possibilities that didn’t exist before for Islamic Finance. One of the interesting things pointed out in the article is that Islamic assets will be worth $1 Trillion by 2010.
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Fed, BOJ Signal We Are All Islamic Bankers Now: William Pesek
Commentary by William Pesek
Dec. 8 (Bloomberg) — Attending Islamic finance conferences these days, it’s hard not to notice how this investment class is catching on.
- Image by GetHiroshima via Flickr
The world’s roughly 1.5 billion Muslims need a way to bank and invest according to Islamic Sharia law, which bars receiving or paying interest on loans or deposits. A massive market infrastructure is being built to facilitate clients that include wildly rich Persian Gulf oil tycoons.
Yet isn’t this industry being pirated by the Bank of Japan, Federal Reserve and other central banks destined to offer interest-free loans? As U.S. President
Richard Nixon, echoing Milton Friedman, famously quipped in 1971: “We are all Keynesians now.” By 2009, we may all be Islamic bankers, too.
It’s an odd yet apt comparison. Islamic banking is more about the means by which a certain group of people obtains money. Zero interest rates are about getting as much money, in any way possible, to everyone.
There’s still something to be said about the spreading appeal of scrapping interest rates. It’s no longer a unique aspect of certain transactions or a banking novelty. It’s becoming the norm, and it’s quite disorienting. (more…)
Tags: bank of japan, ben bernanke, federal reserve, Islamic Finance
23 Jan 09 Sukuk Issues Down by 50%
CNBC is reporting a drop in Islamic bonds due to the economic downturn. Sukuk is another product that will be discuessed in a later post. There is a great deal of controversy on whether or not it is halal. To be continued…
Sukuk issuance down by over 50 pct in 2008-Moody’s
By: AFX | 22 Jan 2009 | 04:20 AM ET
LONDON, Jan 22 (Reuters) - Issuance of Islamic bonds or sukuk fell by more than 50 percent in 2008, due to the credit crisis and the debate over their compliance to Islamic laws, said rating agency Moody’s on Thursday. (more…)
Tags: economic downturn, islamic bonds, Islamic Finance, sukuk
22 Jan 09 Michigan Bank Profits from Islamic Products
Interesting article from CNBC. In light of the current economic climate, it seems that there is a great deal to be learned from these alternative models. The bank in question is University Islamic Financial Corp. We’ll learn more about them in a later post. In the meantime, read this while I struggle in research.
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Finance the Islamic way at small US bank
By: The Associated Press | 14 Jan 2009 | 12:05 AM ET
DETROIT - Big financial institutions have been battered by mortgages gone bad. But a tiny Michigan bank is getting attention in the industry by turning a profit on loans without even charging interest.
Its specialty: financial products that comply with Islamic law. That means no collecting interest, no short selling and no contracts that are considered exceedingly risky. (more…)
Tags: Banking, cnbc, detroit, islamic banking, Islamic Finance
19 Jan 09 Student Loans…What’s a Muslim to do?
Many among us have experienced the headaches of student loans. For the fortunate few, they received scholarships or parents’ savings to pay for education. This post is not meant to answer any questions in regards to Ribah (usury). A complex topic that will have to be addressed at a different time. Rather, I’d like to explore a few of the alternative models out there and leave it to discuss. You maybe surprised with the alternatives. (more…)
Tags: iana financial, islam, Islamic Finance, ribah, student loans
14 Jan 09 Islamic Mutual Funds - An Overview
I’ve conducted some very brief searches. Below is a list of Islamic funds. I have no knowledge of their performance or ethical practices. I will soon assess each fund in greater detail and compare it to market indexes and sharia compliance, though all of them are available through most major brokerages. For now, one thing to note is that there does not appear to be many types of funds like these to begin with. The only funds in this group that have received five star ratings from Morningstar are the Amana Funds. This should not be construed as an endorsement or positive outlook for future performance, as much more research needs to be conducted on these funds. The following is a brief summary of each. (more…)
Tags: amana funds, azzad funds, iman fund, Islamic Finance, islamic funds, morningstar
