هل يقضي الاقتصاد الإسلامي على مشكلة الفقر عبد الله الأندلسي

okay good evening everyone salaam alaikum peace be upon you all thank you yeah thank you for coming my name is mohamed patel i'm the president of the islamic society feel free to take seat yeah so we organize islam awareness week and this is our final talk so thank you all for coming i'll also be your chair today so yeah the format of this evening will be talk by brother abdullah and then there'll be session it will look to finish around eight o'clock ish all right so the touch of the talk is the solution to poverty the islamic economic system by mother abdullah andalusi just quick bio by the speaker abdullah al-andalusi is an international speaker thinker and intellectual activities for islam and muslim affairs his work involves explaining and demonstrating the intellectual proofs for islamic beliefs and promoting the islamic way of life in islamic solutions for contemporary problems abdullah al-andalusi is christian portuguese descent but embraced islam after 40 at 14 after period of study that started when he was 10 years old he has continued to study islamic death ever since he has spoken in community centers universities colleges and has numerous appearances on various tv channels including bbc itv and islam channel he has also engaged in number of debates with atheist atheists secularists agnostics liberals and christians on variety of topics from theology to political philosophy in 2009 he co-founded the public discussion forum the muslim debate initiative forum that promotes open dialogue and critical debate between thinkers academics politicians and public speakers of all backgrounds so without further ado i'd like to introduce abdullah andalusi thank you to the university of east anglia student union and islamic society for inviting me and thank you all for coming for this very very think very pertinent topic considering the current you know global situation with the very long long recession which is which is still ongoing there's as much suffering not just in third world countries from compound debt but it's also suffering in in western countries from people being unemployed through the industry slowing down and suppose the main issue would be the concentration of wealth the the wealth gap between the rich and the poor which is you know getting larger now think these kind of questions and this time people started to question again the the the what's called the capitalist system and some people said you know we we didn't see this recession coming even though it's it's kind of very predictable it's been this has been cyclical nature with booms and busts in west america comics for for centuries so don't think it was anything surprising but people started to ask questions now obviously the only alternative people think about is that there's communism communism is the only alternative to the current system that we have and of course if you want to go down that route obviously we've had bad experiences the world has bad experiences with the communist economic system so suppose the world is in bit of quandary as to what are the solutions to go with but think that also it's not just with the stability of the economic system that we have to look at but also what the economic system the the political ramifications of an economic system and what has caused throughout the world so we see for example because of economic systems because of economics and because of the the desire for resources there's many wars occurring in the world and we see revival of of neoclonaism in some some countries especially in third world countries and so on who are still struggling to free themselves from from the shackles of of foreign control especially of their markets you know which is which is even worse than being under military occupation so if your market is under control mainly due to you know compound interest now there are basically three world views and philosophies concerning economics and what is called the human economic problem obviously there's there's liberalism it's called liberalism now it used to be called libertarianism but the economic facet of this of liberalism is called capitalism or you know it's capitalism the second obviously is communism and the third i'd like to posit is islam and each of these free worldviews has different approach to the human economic problem now we'll start with suppose the the capitalist economic system it frames the human economic problem as being one of humans have infinite needs or infinite wants and there is only scarce resources so considering there is infinite needs humans will have an infinite need for resources for service and things but there are scarce resources it posits solution which is maximizing production the solution to this problem is quandary is to maximize production and then hopefully through the what's called the trickle-down trickle-down theory suppose that if you maximize production eventually everyone will get share of the pie we'll get share of the the resources now in doing this it will implement through implement this this kind of trickle down distribution system through privileging entrepreneurs with incentives and tax break entrepreneurs are seen as the kind of the spearhead of capitalism they are the driving force of capitalism without entrepreneurs you wouldn't have development and growth according to you know the capitalist world view it has an overly permissive approach would say to ownership and disposal which is unrestrained means of disposal and of property and ownership for example you have interest banking which started system whereby you'd have money make money just for money rather than you'd make it from investment and this create the idea that money is debt so money is not no longer means of exchange but money itself is debt so because of the bank to give you money or the bank even to print money it's already debt so with you know the the bank of england and the the federal reserve bank which is not contrary to the name might depict it's not the national bank of america owned by the government it's private bank and it prints money and it prints money at debt to the the government the government so basically the us government needs money for circulation it will ask the bank to print this money and say right well i'll we'll make this money but you have to pay us back obviously with interest of course one wonders then what how you what can you pay them back with if they if they're the ones who are making all the money printing it rather then how where you're going to find the money to you know return that plus extra and of course fractional reserve banking so again you know this this the belief that we have we can use all kinds of different ways of making money unrestrictedly led banks to think quite unscrupulously use fractional reserve banking which is basically that they noticed that when you deposit money into the bank that people generally don't you use about 12 or 13 you know parts there were 12 parts per per 13. so what they did is they would re-lend that money out so the money you put 100 in the bank or 100 pounds in the bank and the bank will lend that out 13 times to other people claiming to everyone that it lends out to that don't worry you know this is this is money in the bank so we're lending out to you i'm hoping that you no one would would basically come to that bank and withdraw that money at the same time so if everyone if everyone withdrew their money at the same time the bank would have to would basically collapse it would need to be bailed out by by the government because all the money it's basically is basically giving in lending is actually doesn't actually exist but it but it balances its its books by basically if it if it gives out money it puts out and it's account that there's minus so basically when it gives that money and it puts in its accounts and minus on the accounting books it looks like it's balanced but really they're actually you know inventing money and then lending out the fractional reserve banking is one of these you could say innovations which occurred in the capitalist system and of course in such situation when you need the entrepreneurs to develop your economy to grow your economy you have to well you have to basically you know give them some some latitude it gives them some some privilege and of course when you do that when the bill comes when you obviously have to mean obviously the you know money starts being concentrating that in that society who's gonna pay who's gonna basically bail out the banks it will be you the people and when you bail out the banks your base with your own taxpayer money you're basically paying the banks to lend you money with interest basically and this is think some of the things which which you know has occurred due to the idea that you know you should have very liberal approach to in innovating kind of financial products and financial services without no regard to the possible consequences that this might have such as obviously inflation and and interest is primarily the primary cause between concentration of wealth if you consider it know just think about how the process works you have let's say let's say the rich one percent over the which are the banks on the top and you have you know the remainder let's say you have you know remaining rather it's more like rather you have one percent then you have like the next 20 percent and then you have the remaining 80 now if you need if you're one of these 80 people and you need to basically have money you need to basically have money start business you don't have the capital so you have to ask that one percent of that 20 for the money and they will lend it to you with expectation of you paying back more than what you took from them now okay so you make your business and you sell to your fellow poor people and you make some profit when the time comes to pay the piper you have to pay back the principal some back to the bank plus the additional you know what's owed in interest if you look at the net direction of money where is the net flow of money it's not going from the rich to the poor the net flow of money is going from the poor to the rich and this is in this is the basic principle of why you have concentration of wealth due to interest banking also in the capital system it has this unders it's conception of human called the economic man that basically what drives human beings is the model it uses is that you know economic purely economic concerns so that we'd be you know humans would be the most efficient you know creatures when it comes to getting resources and then and disposing of those resources but what it doesn't understand or rather what it may be ignores is that humans can you know not just business we're not businessmen or business women we're human and we have many different drives and desires sometimes for example we'd want to donate money just give money away to for spiritual causes for social causes you know not not just as part of some you know very shrewd investment so there are many different motivations behind the human being beyond just purely the economic so looking at human being as the economic man you actually are framed humans as being very materialistic and selfish but human beings have capacity to be beyond materialistic and selfish they can they can actually be very altruistic now okay you you hear it's very cliche about the concentration of wealth and it's cliche about you know mean we've all heard about the fraction was banking problem we all heard that money is debt and you can't have money without debt you know these two things are interlinked but it wasn't always so and there is some evidences mean there is very strong evidences which think many economists know here of why this the capitalist system has led to the kind of leads to concentration of wealth and you see evidence for this for example the world institute did study for development economics research and concluded that in the world globally there's no it's not mystery to economic students here 40 of global assets 40 of global assets are owned by one percent of the population of the world and of course 50 percent of the population of the world only own one percent of global assets and finances if you think it's bad and you think that's just bad globally let's let's go into the rich country let's go to america you know the america great standing of living living according to hollywood movies at least and you know they were the very rich country obviously it's it's benefit quite lot from its economic adventures at the point of gun and it's basically been you know it's viewed as very you know rich country which has opportunities for all but even in america we actually see the same kind of concentration statistics so we see again in america one percent of households own 35.4 percent of all privately held wealth so even in america you see very similar concentrations of wealth and we see that the bottom the bottom eighty percent of the population of america americans own eleven percent of the wealth in america so we're seeing that even in rich country which implements capitalism there is this concentration of wealth attribute now if you might think okay sure concentration of wealth so what mean okay sure maybe maybe you know you get the bill gates and you get the the you know all the donald trumps and all these people that's fine but just because they have you know enormous wealth and maybe even the largest share of the wealth how is that problem how is that maybe that's not really an issue as long as everyone gets to eat and everyone gets to live in household and that's all fine isn't it well that's the problem because not everyone gets to eat and not everyone gets to live in household at least not they don't get to eat from their normal means for example in 2008 it was discovered that 15 of american households were not food secure for the entire year not food secure mean this isn't the country where one in three people are obese and there are fifty percent of households there were not food secure even if you just look in you know in the uk you know the uk consumer group which noticed in 2011 that one in four people in the uk had to use their savings to buy food and the daily essentials in the uk so with so it's not just concentration of wealth is like you know maybe it's just something for the random you know socialist in speaker's corner hyde park to rant about but rather actually there's actual effects we see on the ground and of course mean we know that other aspects of captain which will go through by juxtaposing with the islamic system has led to other such problems such as obviously inflation for the for the you know fiscal inflation mainly due to quantitative easing or what they call print basically printing money basically they produce they just print lots of money devalues the money we see that there's excessive production and waste excessive wastage in in western societies from food and from produce and of course further afield we see that in many countries who you know the people who make the clothes you're wearing they make it for pittance working sometimes 16 hour days some of them lot of them are kids debt slavery as we call it wage slavery is modern day wage slavery and of course we see that if you have to maximize production and there's only finite number of resources in any you know mean in england probably doesn't have any as much resources and anymore for its modern industry compared to obviously the industrial revolution when it used coal and coal was abundant in england but now have to use this uses petrol uses nuclear power it has to get these resources in some way it has to maximize production by getting these resources so does america and how do they get that when they when they need to keep feeding resources into their into this juggernaut of their economy otherwise you you'll see it will collapse if there's no more resources to kind of facilitate the the poorest people hopefully through this trickle-down effect you might you might get certain problems your witness so they have to go out to other countries and they have to buy one one means or the other either you know diplomatic different you know diplomacy through negotiation lot of time through you know economic bullying as they did in south america and of course in warfare if they need to and this is the cause that they that's motivates them and we see this thank you now okay i've made lot of assertions there and again i'm going to revisit those assertions when juxtapose the islamic solutions to number of those problems and then we'll see the comparison for yourself what about communism well okay communism is not really the system which is practiced by many countries today short of north korea and cuba although cuba does have good health system but it is obviously since the collapse of soviet union people don't really take it seriously anymore whenever there's recession though they will go to the bookshops and buy more books of karl marx's das capital to make them feel better but in essence anyway how communism views the kind of the humans and this is very gross simplification because there's many different strands of communism there are communists who probably won't agree with this but generally the main stream of thought is basically that mata is the basis of all things all things are matter and the production of the material things is by the workers so workers are all that matters that is basically okay it's very crude and simplified nutshell but in essence the proletariat the workers are the only thing that matters and we are all equal in that in that we all matter we're all part of the part of the kind of dialectical materialism world view of communism we're all equal and so everyone deserves it or should get an equal share of what is produced by the economic system although this varies according to different kind of communist schools of thought now it agrees with capitalism on one on one of basic things that production is the the problem so it has to maximize production but when it comes to distribution of wealth it achieves that by most most predominant school believes in rigid equality so whatever profession you do and how how much better you are at than your colleague you deserve to get the same wage if you have you know the same number of people in your family to look after and so on so forth all things being equal you get the same wage as anybody else irrespective of your ability or merit now there are problems with the with the communist economic system mainly because private property is seen as theft no one can own any property it's rather it's we all collectively own the property so how they try to manage this is that through number of ways many different means and all sometimes contradictory but in essence they didn't allow free market they don't believe in free market and in order to kind of regulate supply and demand they they use planned economic system so they plan it they plan how much supplier be produced and how much and you know who how it'll be distributed and who gets to have this distribution and so on the problem is that an economic system is so complex because it involves whole number of human beings you know millions of human beings that you just can't plan it you just can't plan that's that sophisticated level because you see if want to if want to increase production of of forks for example need to have metal and need to have refineries available and if increase production of metal and divert it to to forks that would be less metal being used to make life support machines probably or to make you know baking tins or whatever and without using the kind of the mechanism of you know supply demand and price it leads to problems because what you'll get you'll get shortages that you didn't plan you didn't foresee this is why in the communist and soviet system we saw that people have you know lacked sometimes many times basic basic goods like bread and and meat and so on and so forth so the human economics is too sophisticated for plant economic system to be to really cater for the the intricacies and the sometimes the sheer chaos of an economic system and of course that the main the main contention against communism is that humans need an incentive to work they have to they need incentive to improve their work and develop because if you if you're going to pay someone exactly the same amount of money irrespective of what they do where is the incentive for them to improve themselves where is incentive for them to do over time and to get you know to do you know have attention to detail you just can't have faith that people's materialistic worldview will generate in people desire for the greater good when you know human beings don't work like that mean we we want to see some kind of reward or we want to fill with some kind of reward by some means of course communists then develop way of motivating people and they were called political officers or commissioners and the trips your family all expenses paid trip to gulag so you can that was one way of motivating people but unfortunately it doesn't doesn't really help vibrant and dynamic economic system so then what about the islamic economic system well this is going to be something very radical humans have finite needs food clothing shelter how much food you need to eat to survive and so comfortably survive comfortably how much shelter do you need do you need massive palace to survive you know this is everyone must everyone have ten houses or five houses or infinite number of houses and so on you know how much clothing do you need i'm referring to paris hilton she probably does need infinite and so on that probably refutes me but when it comes to everyone else it's only finite amount of clothes you need to survive you need finite amount of energy ie heat to keep yourself warm depending on where you live in the world in the climate and of course you know these things these things are basic finite requirements to be human to live as human being of course islam also looks into other other human needs such as the need the right to have reproductive partner and also healthcare and education are also rights and they're also finite mean you know you know there's only so much medicine you can take and there's only so much education you know you can take up to the limits of human knowledge and then obviously you'll be doing phd or something so these are finite needs now islam recognizes that there is profit motive which is part of the human economic you know motivation and islam ensures that desires are directed by prophet motive but also by spiritual motive it values altruism and philanthropy not just self-interest now islam recognizing human humans to seek profit the prophet muhammad said if the son of adam was given valley full of gold he would love to have second one and if he was given second one he'd want to have third one and nothing fills his belly except dust which is an expression arabic meaning that you know he won't be satisfied until he's dead basically so the prophet muhammed is commenting that humans they need to acquire they need they obviously they want to acquire but at the same time the quran says and it says to muslims to muslims but seek through that which god has given you the home of the hereafter and do not forget your share of this world and do good as god has done good to you and design not corruption in the land indeed god does not like corrupters this mean this whole that whole sentence of that whole verse actually sums up the entire islamic economic system that using the means that we are given to us using the money we have the wealth we have our aims as as humans is to you know worship the creator is to do good it's to actually help people and feel that reward of helping people for its own sake that spiritual value it's not materialistic value you know if donate you know half my paycheck let's just say for example to the poor that's bad economic decision for me but in spiritual value it's very good decision for me so in nutshell that whole verse actually kind of sums up the islamic economic system that even while even seeking the spiritual values don't neglect your portion so don't say right shall you know become pauper on the street go around and beg and become some wandering spiritual holy man or something that's not what it's telling you you don't neglect your portion of this life you don't neglect it right you assure that you're there's comfort for your family you're sure there's comfort for yourself you you improve the circumstances of your of your life you improve the circumstances of your family and your neighbors and so on but your main drive is to do good in this life is to worship god now the islamic economic human economic problem then is not one of production it's distribution that's the islamic economic problem that's this is what islam and islamic thinkers will you know devote our minds to is how do we distribute the wealth to satisfy everyone's basic needs as humans and as for the issue of luxuries there it's let's say fair right you know let the profit motive motivate you to get luxuries that's fine but we need to focus on satisfying everyone's basic fundamental needs to comfortable standard now it was once was on the big questions on bbc one ones and was brought on talk about christian pentecostal spiritual experiences and they wanted muslim to kind of mix things up and say like you know let's bring muslim to talk about christian pentecostal experiences and but one of the great one of the questions and the big questions was about you know was the pope right to condemn you know capitalism and thought you know okay i'm going to get my shot in here you know i'm going to actually you know talk about the islamic economic system so did was only allowed very brief like minute also to do so before they kind of cut me off and then this this kind of one of these staunch advocates of capitalism what mentioned about distribution is is actually the more important thing but what about production without production you know you wouldn't have resources you wouldn't have you know the kind of the things to actually consume but islam understands that production takes care of itself because firstly in an economic system when there is high demand for something and there's small supply of it you know any entrepreneur in that system and the entrepreneurs occur naturally of course they do you know rich people people that have means of people that have great idea and they'll say well there's you know the high demand can make lot of money if just increase the supply of this or find new supplies of it so production always takes care of itself to focus on production myopically and ignore distribution you know this is absurd production takes care of itself the economic system the whole point of an economic system is for distribution do you think rationally why what why do you even have an economic system what is the point of an economic system for any ideology or any any people throughout history it's everyone lives in different parts of the world for example we all you know in our partner we all have little resources and we can access those resources that's not the problem that's not an economic problem rather it's how does each human get you know exchange those resources to off with other humans who have different resources or benefits that is that's what the most rational conclusion the first conclusion i've come to mind is how do we do this how do we exchange why because we need to actually distribute all the different resources because obviously farmer might make corn but he needs to he needs to drink milk his family is he drink milk he needs to drink water he doesn't maybe he doesn't have water he needs to get from somewhere else so then the question is naturally distribution and not production but islam encourages mankind to seek and develop natural resources we see in the quran god says to to muslims it is he who created for you all that exists on earth another verse and god says allah is he who put at your dispose of the seas that the ships may sail by his command and so you may seek his bounty so seek the bounty which god has placed on the earth for us to use and again the god says in the quran he put your dispose of that which is in the heavens and the earth is from him so islam motivates muslims to exploit resources to find resources and to produce and transform these resources into that which is useful for mankind so we do have the incentive to to produce but distribution is the more important issue now islam has three basic you know islamic you know economic principles in this matter it one is ownership two is disposal of ownership and three is distribution of wealth amongst people first and foremost we believe that all wealth belongs to god and you you can't really own anything rather we're given you could say the least so to speak to use it while we're on this earth so we see in the quran it says and give them from the property of allah which he gave you and spent from what he put you in charge of so this is we believe that god has put us in charge of the wealth but to all wealth belongs to god now i've said about you know production i've said distribution is is the most is something we need to you know look at very seriously but how does islam manage what distribution well first and foremost contrary to what people might think or what think was going with this islam does believe in promoting free market system we see in the quran it says you who believe squander not your wealth amongst yourselves in vanity except by mutual trade we see in the quran it says god has permitted trade we see that islam allows supply and demand to determine the prices so we see that the prophet muhammad man went up to the prophet muhammed and asked him if he could fix prices for particular reason and the prophet muhammad said no rather it is god who reduces and increases so the prophet muhammed affirmed that you can't fix prices in islam we actually can't you're not allowed to fix prices for all commodities so it is actually supply and demand which determine price and islam believes and advocates trade so islam believes in what you might call free market but free market with some things something which are prohibited and some things which are restricted but within which it has permitted it is no there's no regulation and i'll discuss what it might mean by things which are prevented not prohibited first and foremost islam views the that distribution of wealth will occur naturally what you need to do is prevent concentration of wealth that's how you tackle the problem of distribution is basically yeah people will trade normally and you know the price and the market for the free market system will allow distribution of resources but the problem is preventing concentration of wealth and islam has number of kind of solutions to prevent the concentration of wealth so we see that first and foremost islam prohibits interest and we see in the quran that god has committed trade and forbidden interest so we see that in that verse that versus actually response to people who said you know the prophet muhammad was some there was some jews who was the engaged interest and they said well you know interest is like just like trade you know they're both the same you know you you invest and you in it with capital and you make more money out of it than you put in hopefully so is it it's the same but the quran rebuked the person who was questioning this and said well look god has committed trade and forbidden interest if they were the same then how could you distinguish the difference between them you see and that's answer the quran made that made very eloquent refutation the probation interest you have to understand why was money invented why was it invented mean if you think about it mean obviously as you know from barter economy it's not very convenient you need to obviously exchange goods which might not necessarily be your neighbor has so you need to have some some kind of store of value or to to or store of services or wealth and this was what money was about this is why it was invented it was meant to be storage of of wealth storage of value so that you could trade that's the point of money the point of money wasn't to be system where you can use you can play games of it and then get more money out of that through not doing any economic exchange at all just you know just extreme playing games of exchanging money and so on islam believes that money should be based on gold and silver biometallic system and so it can't be printed by private national bank and so the financial system starts out already free from debt so you know how they say money is debt money equals debt in this society in islamic economic system money does not equal debt money is commodity of itself because it's made from gold and silver these are commodities so it has intrinsic value and of course obviously you won't see the kind of inflation that will come about when you use quantitative easing will say printing money islam prevents private and state ownership of public resources which provide water and energy for the people so basically there are the national energy resources you know like gas and coal and maybe nuclear power no one is allowed to own them it can't be privately owned it can't be owned by the state so we don't believe i'm not coming for nationalization rather it belongs to everybody and we see that everyone has right in these resources because they belong to everyone so we see for example person went to the prophet muhammad saw someone asked him can you give me an area of land have some salt there could mine that and make some make some money from for mining that and so the problem happens i'm saying occasionally sure you know you can you can take it and then someone who knew that area who knew that land went to the prophet muhammad and said you know or prophet of god did you know that in that place there's actually vast quantity of water vast quantity of water and when the performance heard about this he recalled the guy and said can't give this to you you can't you can't receive it because that water belongs to everybody it can't be privatized and you see that you see part of concentration of wealth is that these energy companies who privately own the act the obviously access to these resources and they sell it they sell you basic needs at making profit on it very large profit as well we see with with the current energy companies raising prices and so they're making they're making the killing in terms of in the current in the current economic market environment even though there's recession you know people who are rich or those like one percent should not have control over your basic needs and so islam has system of of solving that problem which is that the people will pay collectively just isn't enough to extract that and deliver it to them some obviously back in in medieval times or pre-medieval times if it was well you don't need to pay anyone you just go up to the one use it and no one as long as no one stops you from going to that well of course but in this day and age in the modern economic system when you need to extract minerals and extract you know large amounts of oil and so on so forth there could be companies which are hired out by the state on behalf of the people to extract that and provide it to you at cost price and of course the incentive would to improve production would be that if they can improve production they could actually make more than that material and in decrease the price for you so the state has reason to even improve how it it extracts those resources but that the state can't own that money and neither can any private individual own that money it belongs the actual resource belongs to the people and we also see that in islam contracts and debts are not commodities that can be sold as shares or derivatives did you know this is this is absolutely shocking when encountered this okay the world's gdp the glo gross gdp of the world is 65 trillion dollars estimated at 65 trillion dollars the direct you know you know the value of the director's market the value of the derivatives market which is basically you know like you know how people sell sell debts and sell all kinds of mean it was kind of all kinds of financial products and things like this it's worth close to 600 trillion dollars the world doesn't have mean the world's you know you know gdp is only about 10 of the derivatives market we we also see that with stock markets where people are buying and basically in essence you're buying and selling shares or contracts of of of your sharing in company in essence like you're part of that company all companies are formed by contracts they're formed by contracts which incorporate the people into company into corporation but what people do in stock in the stock exchange as you know is they buy and sell in essence they buy and sell these contracts the value of this contract which gives you share in that in that company now this has the effect of undermining the free market system which using you know price and supply and demand because nothing can change in the company it could be you know still have exactly the same supply demand same price on his goodness products selling at the same rate everything's all the same but let's say the ceo walks into his office one day bangs his foot falls down and the price drops of the company the value of the company drops for all kinds of this for for the ideas of speculators and that money is you know that money which obviously is how much money the company can use can it can it can lose that it can lose the money it uses for its liquidity because of speculation and nothing to do with real real world economic difference in essence imagine the real world economy and the you know kind of stock markets and derivatives as two tables with one table people are buying are exchanging goods real real life goods and services and the other table they are exchanging the the value of or speculative value of of the prices of the first table it's parasite economy why do you even have that and and it causes so much trouble when that when that bubble burst in the derivative market we do we don't want to be involved in that system but unfortunately live it now we also see that okay so as said that you know islam prohibits the ownership of public resources there is reason say this the prophet muhammed said that the people are not prevented from free things the people collectively not prevent from free things which is water pastures which he means by that livelihood and fire which means energy so people are not prevented from free things and this is where guarantees are right to the people from being denied or having to have to pay for their basic needs at profit to the person who supplies it islam also prohibits gambling as well because gambling exploits the poor as you've heard the saying the house always wins it's not it's not gay or pure chance where anyone could win it wouldn't be lucrative business and stable business for the the the the people the the companies that do that unless they knew they would make more money out of it than they put in so it tends to exploit the pool whenever you see poor area or an air becomes poor you see whole bunch of betting shops open up in that in that area so in essence islam as you can see islam consistently disapproves of increasing money from money so increasing the amount money from just money itself rather islam tries to advocate trading and investment and i'll get to that in second so that was the prohibited means of ownership of how you acquire ownership there's also prohibited means of disposal so in islam people are prevented from holding wealth firstly you're not going to make any money if your wealth just sits in your bank account because there's no interest so what you so if you want to just let it get get you get spent over time as you as you spend it with no return then that's up to you but in essence there's no incentive for you to leave your money doing nothing but even then islam asks muslims tells muslims we see it from from the quran god tells us and let those who hold gold and silver and do not spend them in the way of god know that severe and painful punishment is awaiting them in the hereafter so as muslims we are spiritually motivated to not hold our wealth to be scared about holding our wealth because this will be slightly punishable in the hereafter that's spiritual motivation but there's other lot of motivations we see as if there's no interest money there's no money you'll make on your on you're just hoarding we see that islam prevents monopolies as well on foodstuffs and basic utilities foodstuffs are things that we need to eat right no one can actually have monopoly on them so we see the prophet muhammed assassin said no one monopolizes except the wrongdoer and we in another narration he says it was report that he forbade that all food stuffs food stuff will be monopolized so no one can control the food you eat we also see that islam has so this is what is prohibited so this is what you i've told you prohibited now well once you put these things out the way and everything else it's free there's no financial regulation no regulators over your shoulder monitoring what you're doing what you're gonna do what you're gonna do with it you can do whatever you want you keep those two you keep interest banking and out of the way and you keep you know holding out the way you can now do whatever you want and what you'll see is that there is an encouragement since the encouragement for islam to spend your money and not just hoard every day all the money that went that was that was owned by people or was earned by people will be spent back into the economic system the islamic economic system would be the most dynamic economic system because as you say you know you have this idea of you need to generate consumer confidence for them to spend you know you have to generate consumer confidence to spend otherwise you know the shops won't make money and the money won't circulate if you're not getting the people to spend right they don't talk about the you know the rich people who hoard them don't look at them but they took they always look focus on us to spend our money enter and the banks and lend us money in in in debt and and we have to pay back the interest but anyway we see that islam gives almost spiritually based consumer confidence which encourages muslims every day to spend or invest their money or even gift their money as give it to people in charity and i'll come to that in second so now i've talked about what is prohibited and i've talked about that in general everything else obviously is permitted what how does islam encourage wealth circulation how does it encourage investment well firstly we see that in islam there's positive encouragement for the cultivation of agriculture so the prophet muhammad sasam said that basically if you can reach it at land it's not being used and you work on it you own it automatically if you can find the land not being used and you work on it you own it if you have land and you don't use it you lose it so use it or lose it so they'll give you three years and if you don't use it then you have to and you have to lose it and you can't lease it either you work on it or you go into contract of sharecropping which is basically you employ you get other people and you come to the agreement that okay you guys work on it and you take percentage of the produce as profit you take this for yourselves and you you you keep that we see that in islam if land is irrigated by water for example we saw that prophet muhammed's asylum he reduced the tax on that land by 50 so if you can irrigate that land or using water wheel for example which was obviously an invention at the time then you get less you have to pay less tax and obviously if you're irrigated there's more production so in essence the taxes are still the same because hopefully more production but it encourages us to develop our lands develop the these properties we see that in islam the government gives grants to people who to to develop wealth and to develop land for example who was the prophet's right-hand man he he gave properties to farmers in iraq like seed and so on to help them plant and grow crops for free just give it to them like you know use this and then they became self-sufficient for example because the in islam we believe that is the duty of of us to help each other not just for ourselves the government will help and subsidize farmers to actually be self-sufficient we saw that the prophet muhammad sallam granted bilal who was very famous companion place where he could mine small quantity of minerals for his upkeep and so he became minor to mining quantity of minerals we also see that in islam as well the state revenues will be used to actually get people who are in debt out of debt so there is actually the government will actually help to get you know to remove debt from society and of course there's no interest so there's not going to be problems of compound interest or an ever-occurring debt because there's no money you make on it and it's very interesting because it's because islam in essence bails out the people if they're in if they're in in problems whereas in in the capitalist system what we're seeing in most of these countries they bail out the banks so they can lend you more money and you beat more debt using and the money they're lending you is your own money you're paying to the government and so on the only person the only government on our kudos warriors deserved is was iceland iceland basically according to washington based fund they just they decided to let their banks go bust and instead put that money into widening the social net the social security net for their people and there's washington-based fund noted that this actually led to them having recovery from their economic decline so that was that was that was an islamic principle right there we see that as said the the the nature of the islamic government is as it's cali phase and in the caliphate system unlike democratic system you can't have lobbies which for you know big corporate interests paying money to the khalif for his election campaigns because in islam okay the the khalifa is elected but he doesn't have to as long as he's competent and he's not it doesn't become oppressive or or corrupt he remains in power as long as he's doing his job correctly and right then he stays in power so he doesn't have to always worry about getting money from corporate interests to fund his next election campaign so he can't be influenced and so and that's in that way the islamic system protects the people from the interests of corporate lobbies unfortunately you can't say the same for the systems here we also see that there's spiritual motivation to give interest loans if you are rich person in islam and this is why was talking about spiritual values we see that that the prophet muhammad said that no muslim would give another muslim alone twice except that it would be written for him as charity so that basically in islam we believe that if you give money you give it away to some someone that's great reward if you lend money that's something that's righteous reward but if you give money to someone to help them that's great reward but if you lend lend to people twice it is equal it's equal to you giving money away to you being philanthropist so there's an encouragement and the rich person who might who's who you know would be believer in islam or be motivated by spiritual values he not is nothing to lose just by lending money and getting the same money back he doesn't lose anything you know but he feels spiritual contentment for doing so and the motivation for doing so and we see that there was these trusts were set up in arabic it's trust was set up whereby rich person would set up hospital or university or any kind of institution of public good and that institution would be sub would generate income by various means but it would go purely on helping people who were poor or purely people who couldn't afford an education at university or couldn't afford hospital bills so we see and that this came from the prophet muhammed who looked at who was discussing the palm but there's palm orchard outside the city of khebar and it belonged to the islamic state and he said that give it in charity with its land and trees on the condition the land and trees will neither be sold nor given as present nor bequeathed but the fruits are to be spent in charity so the prophet muhammad kind of ring fenced that property and that that the production of that of the of the goods from that property will go purely for charitably self-self-sustaining charity or trust we also see as said before spiritual motivation for consumer spending and investing we've seen the crimes as it said let the one who's able to spend spend the best he can and we also see in the quran it says let him who has an abundance spend of his abundance and he whose provision is measured let him spend of that which god has given him and we also see other things where prophet muhammad said exchange gifts amongst yourselves so that you may love each other so we see this motivation to give gifts to seek the spiritual values and as for muslim entrepreneur he who wants to please god who wants to he wants good afterlife they'll be making lots of money they'll try to you know make lots of money have great you know and develop their portfolio and make lot of money so that they can have much more money to spend in charity to send help people and to get lot of lot of kind of good deeds in the eyes of god that's how they must have certainly was the situation in medieval islamic society we also say that if you could produce and you have excess production don't throw it away because for example we saw in in one case remember there was dairy farm and they would throw away excess milk because if they sold it on the market it would bring down the price and they just threw it away whereas in islam mr prophet muhammad saw someone whoever prevented the excess water we're talking about irrigation so if ever prevented excess water to prevent with the excess partial pasture god will prevent him of his bounty and their judgment so basically as muslim if you have excess water irrigating your land then it goes to your neighbor's land let him benefit from that otherwise if you don't then you know god will prevent you from benefiting obviously in in hereafter and we also see that islam made it very easy to invest your money in lucrative projects so forming companies with very flexible structures was extremely easy it was so easy that it's not even recognized as verbal contracts so the conditions have to be formalized but in court of law if you can obviously show that you you and your partner act according to verbal agreement by by looking at your actions that the court will recognize and apparently in british law it's also the case as well you can show that verbal contract existed as well so it made it made it easy for investments to occur through contract through companies to be formed even off the cuff and we see as said that public resources free people's expenditure on basic needs if you don't have to spend money paying inflated bills for your gas and your electricity and so on so forth that gives you more money to then use as private individual to invest to spend on your family and so on and so forth and we see we see also that despite all these mechanisms of circulation of wealth there will still be slight you know disparity where there are being rich people rich people will be making money and they'll be making more money at faster rate than poor people obviously because obviously the more money you have the more money you can make even even in site where you ban interest so there is one final measure which islam uses to realign wealth and this is called the zakat or the wealth tax and we see in the quran it says the zakat are only for the poor the needy and those who collect them and those whose hearts are to be reconciled and to free slaves and the debtors and for the way of god and for the wayfarers and what what this means is basically the eight categories of of the collection of zakat firstly there's car is for rich people basically so if you're rich you paid as card so the amount believe is 20 gold coins if you have wealth equivalent of 20 gold coins or 200 silver coins you reach the nisab or the minimum requirement then you have to pay as there's cut and what we see is that the state collects it and it must be distributed to eight categories of people those who live in absolute poverty have nothing like homeless person also have nothing to their name those who cannot meet their basic needs so those who have to die you know kind of delve into their savings to pay their basic food like we saw happening in the uk for example these people need to be helped okay the people who collected themselves those who were enemies and you want to reconcile them they might have been non-muslims and you might have had into fight you helped to reconcile to free people from slavery obviously back then slavery was was real thing obviously today we don't have legal slavery you have other forms of slavery and foresee that islamic scholars using jewish prudence will deduce that we should free people from debt slavery and wage slavery as the modern forms of slavery we also see that those who've incurred overwhelming debts the debtors as mentioned earlier on the zakat will be used to get them out of debt and they and they won't have to pay compound interest because there's no interest in islam so that wouldn't be such you know difficult thing to for the state to do or bail out the people if the state if the usa bail you know mean instead of spending all that money on its banks it could just build other people you know we could we could have all had our debt erased you know if we're americans mean in uk as well but no the banks we must pay the banks money for them to lend it to us think with interest travelers as well so if you're traveler and you run out of money you can't get back home again the car will go to you to help you get back home to your boat now come up to the last part of my lecture apart from all those other things there is also other things such as temporary government levies there is no such thing as permanent tax in islam the islamic state the caliphate doesn't charge permanent tax but if there is insufficient amounts to satisfy its objectives or obligations to the people it will have to levy temporary tax in order for that for that to need to be satisfied now what we see is that the the prophet muhammad said any community whoever they are if person among them became hungry they would be removed from the protection of god the blessed and the supreme we still also see the prophet muhammad sallam said he who goes to sleep while his neighbor is hungry does not have faith now in islam we believe the government the according to the nation of the prophet muhammad the imam is in charge and responsible for the people the imam the leader imam means leader in islam so the imam is responsible for the people so if people are hungry the imam is responsible and if he if he has insufficient money then the obligation returns back to the people to actually give him enough money so that he can give it to the poor person because it's obligation upon all of us then we all become the neighbor of that hungry person we see that there's there's stability in the economic system was actually quite shocked when discovered this the price of okay price of goat you know in the time the prophet muhammad sal salam the amount of gold and silver coins is exactly equivalent to the price of it today in the middle east was quite shocked so you know 1 400 years zero percent inflation that's that's quite good record okay gold gold goes up and down it does go up and down but on aggregate in in in the long run it's stable because you actually see gold becoming deflated inflated only by maybe one percent or two percent if we look at the gold standard when it was implemented in the uk and europe before they got rid of it it was generally very stable but when they got rid of that we saw inflation rates for example for the dollar which is three thousand percent since this is the implementation three thousand percent for the dollar so the islamic system of the biometallic system is not artificial paper it has intrinsic the money has intrinsic value you'll see stability with its implementation and again that might bring up lot of questions for people about you know biometallic system what's this disadvantages but in charlotte we'll wait for the for that and we can go in we can go through those questions there is state property and it's actually very fascinating thing the kelly the caliphate as state can actually own property it owns property not publicly can't touch public property but it can own private property and in way be corporation of itself and but unlike corporation which makes money for its shareholders the shareholders of the state are the people so the khalif the caliphate might have owned businesses in my own heavy industry most governments will have connections to heavy industry because this heavy industry is too expensive for any one corporation to to fund in that situation the profits made by the the caliphate as the as system as as corporation will go to this the shareholders will go to the people in that same state so in that the state state property is property which muslim masses have right there is matter right of it and its management is left to the khalif to assign some to whom he deems so for example land lounged owned by the state will be portion for people who can work it but before mention that the problem having to sign land to people that was state property and then he just gave it to people as grant and this is how the state helps the people and as said in conclusion i've gone through quite lot it's been quite quite quite compact but think you'll see just by looking at the islamic solutions then comparing it to the current system very wide disparity and this system is not it's not mean it's not one of those area ferry systems where you see yes karl marx is such great idea and implementing it be problematic it worked it was it's been applied for 1 200 years or 300 years into the dissolution of the ottoman caliphate and it generated you know stability it generated growth it generated development mean you know the muslims excelled in the medieval ages in technology they excelled in industry where was from el andelos had highly sophisticated agricultural systems and manufacturing systems damascus for example became famous for manufacturing high quality consistently high quality swords for example damascus blades as they as they could today in the medieval in medieval age being blacksmith the quality of your product was never it was never certain you know sometimes you have really great sword and something have not so great sword it was never really certain but in medieval times you had the equivalent of factory producing standardized uniform products maybe not just swords as well all the metal wear but that was just an example because was reading was reading at rece regarding the vikings borrowing or techniques from from damascus about how to make swords anyway different different subject maybe for next year i'll talk about swords and vikings and damascus but you had the highly developed production facilities in in the muslim world in the medieval ages but you know far in advance of its time and all this was because of the entrepreneurship of of the islamic courages of the encouragement to develop your resources and to expand upon them and to in increased production for what purpose it was to help each other to give to each other to help the poor amongst us to seek the reward of god almost all our universities almost all hospitals were waka for trusts and there were many hospitals and men it wasn't just maybe one hospital every you know 200 kilometers it was you know had cities with many hospitals one hospital in damascus and was serving thousand patients and so on i've heard i've heard all of the statistics and back that 10 000 patients i'm not sure how reliable that is but certainly it was lot and that was all done the medieval ages so all this progression was done by the implementation of islamic system and the regulator the state would only regulate the laws preventing people from using you know engaging interest and fractional reserve banking but this was whole new paradigm now people say to people how was this last point you haven't asked me but i'll ask this question that you're thinking why don't we just take the system and apply it in you know in in western context maybe it might work that system and there's only there's one key ingredient you're missing though if you have materialistic world view it won't work it won't work because like if told you to basically today spend gift or invest all your money and hopefully god will give it to you tomorrow you're not going to do that right when there's recession going on have to guard my money have to hold it i'll tighten it until it tight but as muslims you know you'll realize that if everyone in the society actually just said we don't say you know what let's all spend our money or invest it or gift it or all together then next day all that money that you know that money that was in your pockets would be back into the market for people to to to collect again and you can't do that if you don't have spiritual you know motive or drive it won't work anyway hope you've you've got you've seen how an assignment system worked how it worked in the past and the fruits it gives and inshallah the solutions that it can give for the world today which think is in dire need of it thank you so we're gonna jump straight into the that's okay so if you have question just raise your hand and we'll put your hand up first down to it so now yes brother and because the high demand of this okay okay well the price supply and demand that's the natural mechanism by which sorry okay i'll repeat the question yes gentlemen asked if if sold his if you had bought cup for one pound and you sold any could you sell it for 10 pounds for five pounds or whatever if people willing to buy it but obviously when everyone else is selling cups and they'll offer competitive price you might not get very far and so on so you know you'll have to judge that yourself as as competent businessman islam allows the you know price and supply demand to determine you know price like in like like in the cable system so it's similar you know they're not vastly different there are similarities in all economic systems but you know there is natural equilibrium that will form between humans exchanging goods and islam lets that equilibrium you know flourish it just prevents those things that will that will disrupt the equilibrium and come concentrate into only small area which is really illustrated on i'm interested in the ottoman empire was there was infinite resources at the time but we're we're in world now where there's finite resources just wondered how the islamic economic system might work to deal with finite resources and global warming don't think there was ever infinite resources ever in the world there's always mean there's only so much you can mine if an ottoman was here he'd say wow what is the drilling techniques you have and all this fishing you know use you you use radar on your fishing boats to detect where the schools of fish are man you guys can produce infinitely right they think we're producing infinitely now you see but no it was always finite that that's that's the that's the kind of thing but today we are creating the finite limits of the world and and we can't for example keep any possible fuels because we'll reach the temperature which is understandable you're asking about okay just to repeat the question he's saying that in today's world we're reaching the limits of resources and then also we're burning fossil fuels which is causing global warming okay global warming is different discussion from outside of today's discussion but in terms of reaching the limit we actually we actually really haven't reached the limit of people consuming so there's not there's not more miles to feed than there are food there's actually much more food potentially to be produced than people can eat but what you're seeing is if you look in the if you do some research on this there's massive wastages massive wastages in the world mean mean humans no longer no longer just you know satisfy their their desires with food and resources and so forth they've now in order to kind of justify this massive production in the west they've had they've changed humans themselves to being consumers they're high production but where do we where we pull this production you know was like well the people gonna have to change they're gonna have to eat more they have to consume more and even then they can't eat on consumers so they throw lot of it lot of this food away food wastage is horrific and due to you know very kind of horrendous practices on the market for example what what what america would do in the market mentioned about america before just an assertion but now back it up what they'll do to various developing nations is they'll say okay look you want to be developed we'll get you give you loan and in exchange you develop cash crops so you know forget that subsistence you know kind of farming you're doing get cash crops and you'll make money and you can be developed and we'll sell you our produce we'll sell you our products our industry of course it comes with it with an interest you know bites and even these countries that have faith and say yes okay will will get rid of subsistence farming will sell cash crops to you and you will send us over overpriced you know in industrial produce and back even then you know america or my work is one of them when it comes many countries doing this but i'm just using america's example america on from its point of point of view it's created one you know country that's providing let's say coffee for example but that's not the only country that's told to provide coffee it's also told all the countries make coffee too and then it just picks which one provides me the win the the the the cheapest price and of course the cup if it chooses much more cheaper comp you know country then that country that had faith in the system and adopted their subsistence mean you know government of substance farming and adopted this you know kind of cash cash crops will go into poverty and they can't compete and then they're then they're basically stuck and then we see massive poverty and we see wars and we see famine and we see all these things which in africa they never really knew the level that we have today you know for for africa you know forget the 20th century being you know boon to humanity for africans it was the worst thing ever happened to them you know they had the ability to sustain themselves now they don't so would say that again the problem is not production it's distribution but we're so we're taught to look at the world as problem production production production and it's incorrect it is district it's always been distribution entirely agree with most of the things you said it's just that you didn't address it doesn't seem to have an answer to global warming okay the issue about global warming as said that's more of scientific question with with scientists when it's been debated among scientists as to how do we reverse global warming but okay well all will say is that thanks to corporate interests for those who for energy companies who has stake in the burning fossil fuels they were using their lobbying delayed you know delayed governments from adopting you know renewable energy whereas as muslims again using the spiritual values that we that we are you know inculcate into us we're told to respect the environment we're told to look after the environment the islamic in medieval times we actually had kind of areas devoted only to be untouched green areas so to speak that was the first of its kind so we actually had our respect for nature because although we're given the world to use we're also responsible for at the same time and this is occurs in many narrations by the prophet muhammad saws and himself so again capitalism has led to has led to basically this destruction of environment whereas more environmentally conscious economic system would would not be so destructive and actually would try to make solution for that so just before you answer the question some people muslims are wondering it's just terrible respect for the prophet it means peace be upon him and that's why the muslims say when you say it so yeah that's brother from this question which was asking you know are you able to quote any verse from god it's psych topic but just about you know don't kind of exceed in using the resources and you know protect the environment and is slightly different from the economies itself but relevant question what are muslim countries doing to kind of the fossil fuels and other things being used okay okay yeah well okay the the brother asked okay what are muslim countries doing to in this regard and you know where is the the evidence in islam about taking care of the environment well there are many one of them for example even from small things such as you know removing rubbish from the road and keeping the road clean which the prophet muhammad advocated to to the verse in the quran which they said god has made us vasidrant khalifa on earth and so on which which obviously is that we are now responsible for what we do on this earth and so on as do not like as said do not cause corruption in the land just which mentioned earlier on so don't corrupt the land and unfortunately in the current world we're seeing mass corruption of the land due to over over development without regard to you know renewable keeping it renewable and so on so you know that that there are many verses and said could just picked few but with regards to muslim countries well muslim countries mentioned earlier that the the system in islam for the state is the caliphate's caliphate system do you don't see caliphate in the muslim world you see post-colonial secular states affected by by colonism during the last century and the president before that and of course that the rulers there have stake in in the current economic system basically so even you might think saudi arabia iran egypt under the muslim brotherhood whoever you want to mention they actually have interest banking system in that country remember interest is prohibited people say iran and saudi arabia and egypt these are islamic states islamic countries but they actually permit interest banking you know so then how are they islamic it's veneer mean just just by wearing different clothes or arabic clothes doesn't make you islamic you see that's just the tip of the iceberg in terms of in terms of that so what we actually want to see is this is caliphate which would look after the needs of muslims now mentioned muslims also and obviously maybe didn't kind of have time to explain this fully but also it's that we're also responsible for all human beings so the son of adam so that's where said the salvation is all human beings and so as muslims we also have to help out non-muslims who are poor and so on and we've seen the quran it says you know what is wrong with you that you fight not for the weak and oppressed amongst the earth it says it's general for the weak in the oppressed amongst earth we have to fight for them to protect them defend them militarily and economically as well so we have we have to have we have this consideration but the problem is for capitalism countries if you see caliphate restored with biometallic system not accepting dollars not accepting you know euros not permitting you know exploitation of our resources developing our own industry and not needing to buy you know exorbitant priced you know goods from you know from from their countries it's not gonna be good for business quite simply they have an interest to prevent caliphate from the from development because they know exactly what that will lead to and okay forget about this class of civilizations and holy walls and crusades there's more it's more simpler explanation really is that it will really den their economy severely when they have to they actually have to pay better you know prices for the resource that we give them and we'll be devoting lot of those resources actually to our own industry not just giving it to them but actually developing it to our own ministry and making our own good you know as now i'm not supporter of of lenin and stalin but then stalin said something very interesting when they created their russian their soviet state they said that basically we're not going to import tractors anymore until we can make them basically and that's good they're not like that mean okay disappear everything else they believe in but that is good that is exactly that that would call an islamic sentiment obviously it was just you know what they what they said is exactly what islam would inculcate muslims that we should be self-sufficient and then we trade as equals not trade as as beggars in the global economic system okay next question is my teachers at the muslim faculty how aware you are just question regarding something you touched on with biometallic golden ass and silver dirhams are you aware of any successful attempts taking place now in smaller communities worldwide wherever you've given your dogs or indeed any organizations that are successfully getting word out regarding the importance of using golden my brother said that am aware of any organizations or groups or at any level suppose which are trying to call for the re-establishing of of the biometallic system suppose in the world or just the wilson world or anywhere suppose okay well mean only know of the muslim what's happening in the muslim world and would argue is that obviously there are many groups mean there are many groups which obviously groups which we know are called for caliphate and call for you know islamic state so heard this in norwich's murabi tournament believe it's the mother to nicole for gold dnr and they were trying to bundle the gold dina and you had all the groups which call for caliphates and re-establishing like hispanic suppose various other islamic groups around the muslim world but just calling for it calling for just implementing gold dinar devoid of state is is not gonna it's not gonna happen because the state has to underwrite the economic system he says this is legal tender if you don't have state saying that there's no point just saying well hopefully everyone please use gold dnas and you know distribute them around they're not it's not going to happen right it can happen from community level again you can't you can't make any any kind of in any you can't change paradigm society without the thing that brings that society into existence as society with based on the values and ideas and which that isn't obviously an ideological state state that implements an ideal and more enforced rules according to the ideal so again like you know it's like mean just just to kind of look at it from let's say from the western perspective if would say you know we have free market system without without government basically it won't happen because who's going to police people who default on contracts or who steal and so you need who's going to say that you know that bank note you have in your piece of paper you have in your in your wallet of which you have so much confidence in is legal tender you see because without the without the british government that piece of paper is just piece of paper see so you need to you need to have you have to have state to underwrite the the legal tender of that country before it could actually be legal tender and be adopted by by it must be it must gain currency currency must gain currency by means of state you need this desire how does the principles of islamic okay the gentleman asked how did the principles of islamic banking compare with the current banking system well believe in would just make kind of answer question from medieval times have it in medieval times there was work of institutions whereby they would allow you to basically deposit money in these institutions and then you they'll give you check and you can go halfway across the world and catch that check in an equivalent institution that will take that so it's not the first checking system basically and in essence the work was produced by people who donate money so that money can be that institution to lend and get and obviously people pay back no interest but that that will accrue good deeds for the you know good deeds and eyes of god for that rich person even though he loses no money you see that was great incentive the modern banking system obviously is very different to that because they obviously want to make money from playing money games and so what they'll do obviously as you know is they will lend out money demanding interest in return even though there's there's actually there's not enough money in the world to pay back all the debt in the world there's nothing literally not enough money in the world to pay it's it's quite very strange system and of course fractional reserve banking you know led to that when you when they could yes so was talking about what they are my currency banking banking is they lend you money and then you you you pay them back with plus bank charges which seem to be proportionally related to how much money you've given now you know according to spader spade it's kind of like it's kind of me saying yeah this is halal pork basically i'll just say bismillah you know if it looks like duck you know it's done all right it cracks like duck and so on and so forth so would say that it's just they just repackage the same same financial services same financial products with different name and so on so don't give much credence to the modern ideas flying around in front of you okay so that's very good question if the islamic economic system was implemented for quite some time why did it cease to exist well okay it only seems to exist when when with the destruction of the ottoman caliphate in 1922 or 24 depending on where you want to set your dates with that but in that sense the the the reason for the maybe the collapse of the islamic civilization itself in terms of it would visit the the western civilization as in the old while the client not really collapsed more for the client was not nothing to do with economics it was actually more to do with well our kind of civilizational atrophy think the best way to put it is the worst thing that ever happened to the muslims was our success in about fifteen hundreds we reached pinnacle civilization and we did whatever civilization does what it being hadoon the grandfather of sociology you know kind of predicted which is that once you reach state of luxury you reach state of equilibrium then you the site tends to just kind of like almost relax and enjoy the luxuries and just enjoy the good life and they cease being innovative dynamic and kind of being forward thinking and then then they switch to to say well look we've got such great civilization we are you know supreme in economics politics military and all these things let's just conserve what we have this is what they mean this is their mentality we conserve the birth of conservatism it was the birth of of looking back to the past or preserving the past as opposed to looking forward and that occurred because of our success again it's sociological phenomena it's and then it's the atrophy of thinking so give example you know so this is gross you know another kind of generalization but you see some of the people who are like almost because they quote unquote dumbest people in the world are the the kids of rich people of very rich people let's say they're the ones who basically go out and spend one grand on t-shirt or something for example you know and then have to you know like rest the whole day because it had tiring day right you know such people you know you've noticed why are they like this why are they so shallow why it's because they don't have to think there's no problems in their life that motivates their thinking everything's there on silver platter so with the summer civilization around 1500s when they have developed their agriculture to the peak of its time when they had you know they had their they were food secure they were militarily you know dominant they had no no threats okay there was few you know mongol problems but that was dealt with and that one was even converted to islam and so on you know they just relaxed in essence and they they sat back and then the decline of thinking that had occurred in the muslims whereby islamists became now set of rituals and was understood only superficially as just set of what you know words you give lip service to and they they forgot the spirit of islam the spirit that's of the entrepreneurship of the innovative nature of islam right it trump it's transforming project islam it's not it's not there to be kind of keep things fixed in time it's actually meant to transform the world make bring us close to god by developing new technologies that help us make us closer for example mean just even just using modern example if there was no decline of islamic civilization and we reached the improvement of it earlier but we said we would develop youtube for example the equivalent right you know why we don't why we want to develop youtube it's because you could put beneficial educational lectures on youtube and get thousands of people watching it with no further effort of iran you know you just put your video up and thousands of people will be watching beneficial lectures or good you know advice you give and in islam we believe that every person that benefits from you know good advice you say or something you teach you get good you get reward from god so it would be great for person to say you know what just do little bit of effort maybe five minutes from the camera and get thousands of good rewards from people all around the world looking and benefiting from my advice see incentive motivation for development motivation for in making new technologies this is exactly how kind of an ideological muslim would look at it but the muslims that you know from from after the 15th century 16th century rather we just we kind of we we got stagnated entirely or and and we we didn't no longer develop new markets did you know the ultimate like they discovered the new world right they've got the new world full of opportunity and there was it was rush you know rush from the european nations to go there and colonialize right and the ottomans was like meh it's like what's been thinking why do we need to go over there we've got such such good life here and and then obviously they let europeans go there and then the europeans basically got so much resources it brought so much gold and minerals then the europeans basically then made much you know then basically with that gold they went into ottoman markets and started buying out all the resources and ottoman markets and then was like that made it even worse for ottomans then their armies were well equipped because they had so much wealth and then you know ultimate start to lose battles and things like that mean it's long discussion but in essence why wouldn't ottomans you know also go to the new world and develop it and see what they can do mean if they actually did it they wouldn't have actually even killed the natives and subjugated them and they would actually prevent co-opted the natives as islam always does when it goes to new area it doesn't actually kill people massacre people force them to to be slaves or what have you but rather actually co-ops the people into the economic system this happened in the landlords happening in all the areas in the world and so on that's quite it's quite interesting that's got this discussion so anyway in nutshell hope that's answered your question sister i'll see you somewhat the brother the son the best question you the financial product in islam is the heart of all the perfect things which is which is not true so sorry so say again about that islamic finance project which is like which is currently done in some islamic country which is disagree with you about that the proper way of doing financial islamic product which is good way to finance yourself as as trade or as businessman however which is in some country now they do it in the wrong way which is they do it as just covering it with with with the islamic phase but the real islamic finance project is there okay think think you're agreeing with me like basically yeah the the the principles of islamic banking obviously you know we agree with but people are are claiming to do it but it's not actually islamic banking it's using interest and so on and so forth so so the important you're putting an islamic face on it but would agree this is the problem because it misleads some muslims who believe it is you know it is interest-free banking there is money not this islamic project and this samba they do as proper islamic run with the questions the food has arrived at the islamic center so are you free to come here yeah inshallah okay wanna put it on today's question and one more question okay so we'd have one more question after the brother's question okay think if you if you look in in saudi arabia what they do is in the banks that don't claim to offer interest what they'll what they'll kind of do is they'll they'll buy let's say house or car for you on your behalf and they calculate how much they would have made if they charge you interest and then they sell it to you at this higher price and in essence it becomes exactly the same no no difference to interest interest banking and of course if you default if you default in in pay their payments to the bank they keep your money and the car which mean islam is incomplete contract because if you default they have to return back the money you've paid so far and they get back the the product but they don't do that that's not an islamic based you know agreement or deal so would disagree with you there there was someone from the audience think another question think you said that's my question about interest rate sure is another way of investment what's prohibited in islam okay well as said before okay the brother said what about the interest rate was not another form of investment okay in essence all things you apply your wealth to it are an investment you could say everything you play involved to an investment but there are some things which you can't you're not allowed to make money from and you're not allowed to make money just for money playing games with money itself money that what is the purpose of money it's meant to be means of exchange for goods and services or commodities not in itself means to make money to give you extra you see so that's where that was why where the islamic prohibition against you know interest will come from that you're abusing what money is and secondly it this actually promotes concentration of wealth and that is that is the primary culprit for concentration of wealth and that you have to kind of deal you know deal with that to create system that's more just for people and so mean that's that's what's basically the the proprieties obviously as we believe that in islam you know god knows best and we do as you know what is good and bad and so we take obviously as commandment but this is the wisdom behind the command from god that you're preventing concentration of wealth and it's just absurd you're using money to make money to in of itself to make money whereas money is meant to be useful has purpose for something else which is just to facilitate exchange so make money for exchange why do you need to and you're contributing to distribution if you do that but why make money from money you're not actually contributing anything to you know exchange that's that's the the reason that that that is the end of the session here thank you for coming i'd like to say if you want to come for the food but you're short of time then just come down to the slamming center we'll pack it for you otherwise we're going to have the dinner there brother abdullah and lucy is going to be there so if you if you don't mind any questions that will give it to you come harass me you can come harass him basically yeah so yeah thank you all for coming if you don't know where the islamic center is we're all going together now it's literally minute away it's just where see the annex is so yeah you