:salam2:
what is the islamic stance on currencies?
the fact that economies are using currencies mean that they will always be interest based. Interest is necessary because a currencies devalue over time (time value of money).
The only way to avoid interest is to abolish currencies altogether and go back to gold silver and copper coins. and barter trade. this would give people more freedom and prevent the world from being controlled by the banks. Whoever invented this monetary system was on hell of a cunning man.
Brother, this is not a fact rather a myth.
The concept of time value of money in conventional economics
In conventional economics this concept implies that there is a monetary value of time which implies that money or credit given to anyone has a positive value depending upon the time of credit/loan. According to this theory, money/monetary assets necessarily earn return irrespective of the nature and the result of the underlying transactions and the businesses. In other words, the present value of an “X” amount of money is greater than the right to receive the same amount of money in future and, therefore, the debtor must pay to the creditor the amount “X” and an addition over it. Hence all loans, credits and debts have a charge normally known as interest or opportunity cost in conventional commercial terminology. Debentures, bonds, treasury papers and other loans created in the conventional system always have positive time value and the interest charge on them keeps on accruing until their repayment.
Time value of money in Islamic economics
Time has an important impact on the value of money. Hence, the price of 1 kg of a specific quality fish might be $5 in the morning and $4 in the evening. Therefore, as a general economic and business phenomenon, the concept of time value of money is accepted in Islamic economics. It is quite natural, as per Shari’ah rules, that the credit price of a commodity is more than its cash price at one point in time while in forward contracts like “Salam”, the price to be paid in advance for future delivery of the goods is less than the spot price of that commodity. Acceptance of this difference in the two prices of a commodity, when one price is settled at the time of execution of the sale, is tantamount to the acceptance of time value of money in the pricing of goods (in trade), or usufruct (in case of leasing). What is prohibited is any addition to the price or receivable once agreed in the event of any delay in repayment. Similarly, the Shari’ah prohibits the mutual exchange of monetary values except when it is done simultaneously. This is because one party can take benefit by use of a currency received while not giving its counter value from which the other party could have taken the benefit.
What about curruncies?
Muslim jurists have unanimously agreed that two separate classes of assets are susceptible to Riba,
• Currency or money and
• Few commodities mainly food items.
The requirements of an exchange involving these two types of assets are the same.
It is explained in the tradition that Prophet Muhammad (pbuh) was reported to have said
“gold for gold, silver for silver, wheat for wheat, barley for barley, dates for dates, and salt and salt, like for like, equal for equal, hand-to-hand . . . ”
If the commodities differ, then you may sell as you wish provided the exchange is hand-to-hand.
These requirements are only applicable when there is an exchange of one currency for another currency whether it is the same currency or different currencies. The requirements also apply to the exchange of a food item for another food item, whether it is of the same food item or of a different type.
No need to abolish currencies altogether and go back to gold silver and copper coins brother
Islam is the perfect deen which will master all the ways of living @ any circumstances!!!
:fighta:
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