Why care about Islamic Finance?

Quotes of the week:
"EVERYBODY wants it. Nobody understands it. Money is the great taboo. People just won't talk about it. And that is what leads you to subprime. Take the greed and the financial misrepresentation out of it, and the root of this crisis is massive levels of financial illiteracy." - John Bryant of Operation HOPE, an evangelist for financial literacy.
This why we have announced our first Educational Seminar on Islamic Finance in Toronto for 2:30 pm tomorrow April 12th at the Radisson East Hotel (55 HallCrown Place, Toronto). The seminar is designed to explore the place Islam occupies in our financial lives. We will not be selling anything other than ideas and you will get the unusual and unprecedented chance to meet your humble correspondent in person ...

P.S. The column below does speak of God, but not in an exclusionary or exclusively Islamic sense and I think that people of all faiths, no faiths and no interest in faith whatsoever on this list will still find something there to appreciate. I do apologize for any offense - I assure you that none was intended. I do look forward to seeing some of you at the seminar tomorrow (Free but no real Food - sorry).


Commentary for the Week:
Why should I care about Islamic Finance?

Many people are of the opinion that Islam and Finance should not really mix. It is said that Islam is about values, morals and duties whereas finance is about making money. As money is a great 'evil', necessary but ultimately impure, never the twain shall meet. If we add to this the argument that our fellow Muslims (and perhaps us - God only knows), have not really done much in service to humanity while professing to be Islamic Finance professionals, we begin to understand the argument. Indeed, our contributions pale in comparison to even mining magnates in just Canada - whose companies use up and destroy large tracts of land in the search for jewellery and telephone wires. Even though their companies use chemical leaching and other destructive extraction processes, many are themselves the greatest personal donors and benefactors of hospitals / universities / charities and the like. In comparison to that, what has Islamic Finance really done, and why should you really care? After all, your mortgage is well on its way to being paid off, you have a good job, family and bills to be worried about. Why should you take Islamic Finance seriously? Why should you care?
Well, this is a difficult question, and ultimately it will of course be a personal choice. Let me share with you though, some of my humble thoughts and maybe you can share with me some of yours. First, the question as we have framed it above, is a bit misleading. The question is not really whether we should start to care about Islamic Finance, it is about how we came to stop caring about God in the realm of our financial choices. In essence, we are asking ourselves when and why we lost sight of God as we saw money. Does our sinking into materiality have something to do with that connection to God such that our absorption in one, leads to loss of the other? Is there a balance then, that we should be hoping to achieve?
Personally, I myself am totally off kilter. I wouldn't know Piety even if it hit me in the face while I was supersonic. But learned minds have explained to me that there is something of a balance that people can sometime find. Instead of either chasing money or either chasing God, perhaps it is possible to use money as a powerful means to do Good. How is this Islamic you ask, and what about money being 'evil', and what about never the twain shall mix? Well, without harping on the details, it is unthinkable to me that our faith would address so many mundane aspects of our daily lives and yet leave the profundity of wealth management unaddressed beyond charity. There must be then, something about how we spend our wealth and conceive of finance that we have not paid any real attention to.
In my limited and imperfect research, there are two major themes that come to mind. First, one feels that at its core, Islamic Finance should be about Social Improvement. It should be about leaving the world a better place than we found it. There is so much that there is to do and improve and fix, that we really have no lack of opportunity. We also have no lack of resources. We have been entrusted by God with land, intellect, muscle, capital, technology and of course, thanks to NAFTA (cannot blame God for that) - cheap Mexican labour. So the second theme really is whether we have been good Stewards of all the amazing things, including our hard working and underpaid Mexican brothers, that we have been entrusted with. Between the concept of a moral use of our money and the concept of a careful stewardship for all the wealth that we coexist with which is not money, is perhaps the place that we have been searching for. It is perhaps the place that we will find another connection to God. It is also perhaps the place we really want to mean when we speak of Islamic Finance.
Going back to the question of why we should care then - let me ask you a question to counter yours. I know that we usually share a few not-so-funny jokes that still make you laugh, but today is perhaps a day to be a bit reflective. Let me then overstep my bounds and ask you a personal question. What then, is the purpose of your life? Is it not to be at the same place that we have just discovered? Let me get even closer then, to the heart of the matter and to you. Close your eyes my friend, and ask yourself this question: Do you really need a reason to care, or can you feel that we are past reasons now?



Finance News:

1. Mortgage foreclosures start in the richer neighbourhoods and areas of US as well ... read more here

2. As was humbly predicted here a couple of weeks ago, some hedge fund payouts are truly amazing ... read more here

3. Some strategies and insight into how debt affects your financial plans ... read more here

4. Video interview of George Soros discussing this crisis. He is the man that 'broke the Bank of England' in the 90's (?) ... read more here


Economic News:

1. For a long time now, the US has been importing deflation from abroad in the form of cheaper goods. That tide seems to be turning with the precipitous fall in the US$ ... read more here

2. The IMF reports that losses from the credit crunch will top $945B ... read more here

3. In case you were wondering some of the real decisions of the world are made (hint: It's not the UN) ... read more here

4. The gambling industry says they generate almost 300,000 jobs and create lots of value to the economy. Hmm ... all those lives, time, energy and resources spent robbing Peter to pay very little to Paul? ... Value indeed ... what is unconscionable is that the Government is actually in on the act ... read more here

5. House Prices in Britain are now falling ... read more here



Islamic & Middle East Finance:

1. N/A


Miscellaneous:

1. Excellent column and advice for job-seekers ... the idea is to create the opportunity rather than waiting for one to fall in your lap ... read more here

2. A physicist disputes the naming of the 'God Particle' that is supposed to explain a bit about how mass was created early in the universe ... read more here