Secular Islamic Finance



Islamic finance and economy has some admirable trades (in a nutshell: stimulating Productive Capitalism and repressing Financial Capitalism and not the other way around as now is the mainstream development in the Global West). So: What if you or your nation like most of the facets of Islamic view on finance and economy and you’re not a Muslim nor a Muslim nation? Is the Islamic view on finance and economy not just a preference for Productive Capitalism and a statement against Financial Capitalism? Or: Is the Western look on economy and finance just too heavy influenced/poisoned by looting principles: as it facilitates a drain from the real economy towards the financial economy. And: Is draining the real economy not a that good/smart concept? Yet that’s just what Financial Capitalism does. As it widens the wealth gap within economies/societies.

The Islamic finance and economic models are interesting, they even could be seen as better than those that current are destroying/imprisoning the economies of the Global West. Or more diplomatically said: The Islamic finance and economic models are delivering more the wanted output than the financial and economic model of the Global West. Better said: the Islamic finance and economic models are delivering Productive Capitalism (with all its advantages) and prevents the rise of Financial Capitalism (with all its downsides). Therefore are the Islamic views on finance and economy are way more attractive than the Anglo-American views on finance and economy that are currently prevailed in the Global West.

http://www.planck.org/publications/Financial-Capitalism-vs-Productive-Capitalism

http://www.planck.org/publications/Productive-Capitalism-Perspectives

http://www.planck.org/publications/Financial-QE-vs-Productive-QE

What's the core of Islamic Finance? Loans are replaced by equity, so interest is replaced by a risk- and result fee. The person/entity who/that gets the finance delivers a part of the profit to those that delivers the finance. So user/deliverer are in the same boat. Making the deliverer much more careful in investing. In this model there's a direct connection between the activity/service and the finance that makes the realization possible. No derivates, no systemic risks. Just mutual performance focused. Amortization and interest collecting is replaced by a mutual interest based model. It also prevents to grow the financial industry to the bigger than wise size of beyond 2 % GDP (by financial industry with a size of above 2% GDP the financial industry becomes parasitic on the real economy). An interest driven financial system rewards asset accumulation instead of asset production: so it can't have a general interests favouring effect by design.

As Financial Capitalism has steered the Global West to dire straits, the solution could be adapting secular the financial and economic models of the Islam. They will deliver Productive Capitalism to the max. The Islamic finance and economic models are the hidden/forgotten/neglected diamonds of the Islamic culture. In a time when Islam has some severe PR issues due extremists (and the bad by association impact is determine the public opinion in the Global West unreasonable but massive), these two diamonds of Islamic culture should be promoted to the max by the Islamic world, as they could offer the Global West a way out of their dire straits and decline.

Not only for Islam and the wellbeing/performance of the Islamic world, but also/just for the wellbeing/performance of the Global West. This is not a religious statement (as we’re neutral in matters of religion). This is statement on the right direction of finance and economy. The Global West has to loose (better said: is loosing due circumstances) its arrogance and attitude of superiority. Paving the road for integrating of some proven third party wisdom. Not only the economic views of Islam need to gain influence in the Global East and Global West, but also the views of Buddhism (wellbeing besides possessions and more in relation with nature) and Confucianism (social relations within generations/environments). The Global West has lost its claim on operating the only economic truth in a shamefull debt burdened growthless/declining way (beside that it lost -by torture etc- its moral leadership since 9/11).



See also International Currency Stability
See also Europe: Diagnosis and Prescription
See also Governmental Funding Turbulence
See also Labour Taxation
See also Money Creation
See also Energy Open Finance Platform
See also Global PV Solar Energy Finance Model
See also EQE/EBS Model Summary Diagram
See also BQE: Bilateral Currency Swaps
See also Gold Backing vs EQE/EBS Backing
See also Secular Stagnation as Denial Term
See also Financial QE vs Productive QE
See also Productive Capitalism Perspectives
See also Emerging Nations - Electricity PPP
See also Emerging Nations - Solar PPP
See also Easy Instant Solarizing Nations
See also Making The Euro More Offensive
See also Structural EU/EC Boat Refugees Solution



See also Global Solar Rollout - Description - Diagram
See also Regional Solar Rollout - Description - Diagram
See also Obama Administration Energy Strategy
See also China As Global Leading Solar Energy Nation
See also Open Finance Platform for Energy Investments
See also Iceland 3.0: Geothermal and Energy as Currency
See also Addressing Economic Decline of the Global West
See also IntraContinental: Continental Rail Schedules
See also Global West Enters Economic Adulthood
See also Global East Driven Globalization 2.0
See also Financial Capitalism vs Productive Capitalism
See also CIRI (China India Russia Iran) Avoids Dollar
See also Global West Gets A Common Currency
See also What Ended Global West Dominance
See also National Economic Development Organizations
See also Desert Investment Economics
See also Ending Global Poverty (By Sea Water Irrigation)



See also Global Deserts Exploration Model
See also WaterTech and MicroCredit Merge
See also Lupin As Soy Replacer
See also Global Seed Cartels Aren't Right
See also Global Food Model: Local to Global
See also Sun / Earth Interactions
See also Telco 3.0 : Telco out of the Cloud
See also National Business Clusters Abroad
See also Scientific Education/Research Funding
See also Iran: National Economic Plan
See also Immigrants and Trade
See also Emerging Nations - Minerals PPP
See also Emerging Nations - Deserts PPP
See also Emerging Nations - Energy PPP
See also National Solar Fund Model
See also Secular Islamic Finance
See also Open Energy Finance Platform

Gijs Graafland / Planck Foundation / Amsterdam 2015

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