Aoa
I have tried to have this question asked but it seems religious scholars typically evade this question because of fear of retaliation.
Obviously we know riba is prohibited in Islam. No questions. From what I have understood is riba is asking for added value in addition to what was given.
At the time of Prophet money had intrinsic value, gold, silver, dates, rice, barley were used as currency, Then came currency that was backed by commodities. Now we have currency that is managed by Central banks.
Now Money itself is a form of interest. The central banks deliberately decreased the value of Money which we call inflation. You can also call it "Negative interest".
Usually they want the value to decline by about 2-3% every year so that people don't panic. Its like the analogy of putting a live flog in cold water and slowly bringing it to a boil. The frog does not notice a subtle change in the water temperature and gets cooked - God knows if this is true or not!
Now with the ever decreasing value of currency, is it haram to ask for more fiat currency than you gave? Is riba value for value, or is it just dealing with arbitary numbers? in 2018 price of gold was $1200 per oz now its close to $2000, so compared to gold the value of money has gone down.
Now you might say instead of keeping dollars in your bank keep gold. Well its not that simple.
(Also I understand that price of single commodity like gold can fluctuate itself, but I am using it to keep things simple)
If you would have bought gold in 2018 and sold it today you would have had to pay tax on the $800. Depending on your tax bracket that can be as high as 50% in some countries, so now you are left with $1200+$400=1600 and an ounce of gold is $2000 so you are short $400.
If you tell me I should keep it hidden from the govt that's a crime and tax evasion.
There are other complications too. They govt wont allow you to use gold as currency. Currencies all over the world are backed by the law enforcement agencies and the military.
If the governments allow free flow of money that can cause law and order and crime issues. All currencies are tracked. You cant take more than a specific amount of gold on airplanes the govt will confiscate it.
Another issues is that if you use precious metals as currency there value will skyrocket because there is limited amount in the world, it will disrupt the govts power to regulate currency.
So we cant get rid of currency and no one is allowed to introduce another form of currency. This crypto-currency stunt wont last long. Govts all over the world love these ponzi schemes because it consolidates wealth in few hands. If fewer people have money that means there will be less expenditure. Say you have a 1000 people wanting cars that a 1000 cars but if that wealth gets consolidated in fewer hands say 100 people which typically happens in Ponzi schemes and gambling that reduces demand.
As soon as govt feels threated by these crypto they will ban it. They can enforce it because they control the law.
Finally last issue - if you don't take interest, the bank will keep your money, put it in govt bonds, get interest, give you back your currency which has now less value that it was when you deposited it - they will love you for the free wealth transfer. The banks gain power this way. Wealth controls power. You become poorer. You worked hard to earn wealth and you gave it to people who didn't deserve it.
Now I have explained that
a- Money itself is negative interest
b- Gold is not coming back
c- Crypto is useless
d -You cant use any form for currency because govt controls it
e- at time of our Prophet Money had intrinsic value - now value is regulated.
e - Giving hard earned wealth to banks and made them more powerful - that's just stupid thing to do.
My humble question is why can we not make sure that the value of out wealth remains stable? is it wrong to take interest, - >pay taxes -> adjust value of our currency to consumer price index aka inflation and give the rest away.
I might be wrong - please correct me. In my opinion Currency itself is haram, it allows banks to charge negative interest. Negative interest is as haram as positive interest. If you are a part of haram system you have to use your brain and reasoning to see what God what's and do the right thing. Not preserving your wealth and letting your wealth deteriorate is not a solution.
In my humble opinion we should not look as interest and increase in number but an increase in value. If $100 buys the same amount of goods in 2000 that $1000 buys in 2100. Asking for $1000 in 2100 is not haram, in addition you have to ask for more for taxes! the number on currency is just arbitrary and Riba is asking for additional value and not just an arbitrary number ie fiat currency.
I am not an alim but I have put in some deep thoughts into this issue and I think most ulema dont really understand the depth of this problem and dont want to deal with it beacuse they will be shunned by the society.
forgive me for spelling mistakes, grammatical errors.
I would love to hear your opinions. I personally don't take interest even though over the years I have come the understanding that its not haram.
I have tried to have this question asked but it seems religious scholars typically evade this question because of fear of retaliation.
Obviously we know riba is prohibited in Islam. No questions. From what I have understood is riba is asking for added value in addition to what was given.
At the time of Prophet money had intrinsic value, gold, silver, dates, rice, barley were used as currency, Then came currency that was backed by commodities. Now we have currency that is managed by Central banks.
Now Money itself is a form of interest. The central banks deliberately decreased the value of Money which we call inflation. You can also call it "Negative interest".
Usually they want the value to decline by about 2-3% every year so that people don't panic. Its like the analogy of putting a live flog in cold water and slowly bringing it to a boil. The frog does not notice a subtle change in the water temperature and gets cooked - God knows if this is true or not!
Now with the ever decreasing value of currency, is it haram to ask for more fiat currency than you gave? Is riba value for value, or is it just dealing with arbitary numbers? in 2018 price of gold was $1200 per oz now its close to $2000, so compared to gold the value of money has gone down.
Now you might say instead of keeping dollars in your bank keep gold. Well its not that simple.
(Also I understand that price of single commodity like gold can fluctuate itself, but I am using it to keep things simple)
If you would have bought gold in 2018 and sold it today you would have had to pay tax on the $800. Depending on your tax bracket that can be as high as 50% in some countries, so now you are left with $1200+$400=1600 and an ounce of gold is $2000 so you are short $400.
If you tell me I should keep it hidden from the govt that's a crime and tax evasion.
There are other complications too. They govt wont allow you to use gold as currency. Currencies all over the world are backed by the law enforcement agencies and the military.
If the governments allow free flow of money that can cause law and order and crime issues. All currencies are tracked. You cant take more than a specific amount of gold on airplanes the govt will confiscate it.
Another issues is that if you use precious metals as currency there value will skyrocket because there is limited amount in the world, it will disrupt the govts power to regulate currency.
So we cant get rid of currency and no one is allowed to introduce another form of currency. This crypto-currency stunt wont last long. Govts all over the world love these ponzi schemes because it consolidates wealth in few hands. If fewer people have money that means there will be less expenditure. Say you have a 1000 people wanting cars that a 1000 cars but if that wealth gets consolidated in fewer hands say 100 people which typically happens in Ponzi schemes and gambling that reduces demand.
As soon as govt feels threated by these crypto they will ban it. They can enforce it because they control the law.
Finally last issue - if you don't take interest, the bank will keep your money, put it in govt bonds, get interest, give you back your currency which has now less value that it was when you deposited it - they will love you for the free wealth transfer. The banks gain power this way. Wealth controls power. You become poorer. You worked hard to earn wealth and you gave it to people who didn't deserve it.
Now I have explained that
a- Money itself is negative interest
b- Gold is not coming back
c- Crypto is useless
d -You cant use any form for currency because govt controls it
e- at time of our Prophet Money had intrinsic value - now value is regulated.
e - Giving hard earned wealth to banks and made them more powerful - that's just stupid thing to do.
My humble question is why can we not make sure that the value of out wealth remains stable? is it wrong to take interest, - >pay taxes -> adjust value of our currency to consumer price index aka inflation and give the rest away.
I might be wrong - please correct me. In my opinion Currency itself is haram, it allows banks to charge negative interest. Negative interest is as haram as positive interest. If you are a part of haram system you have to use your brain and reasoning to see what God what's and do the right thing. Not preserving your wealth and letting your wealth deteriorate is not a solution.
In my humble opinion we should not look as interest and increase in number but an increase in value. If $100 buys the same amount of goods in 2000 that $1000 buys in 2100. Asking for $1000 in 2100 is not haram, in addition you have to ask for more for taxes! the number on currency is just arbitrary and Riba is asking for additional value and not just an arbitrary number ie fiat currency.
I am not an alim but I have put in some deep thoughts into this issue and I think most ulema dont really understand the depth of this problem and dont want to deal with it beacuse they will be shunned by the society.
forgive me for spelling mistakes, grammatical errors.
I would love to hear your opinions. I personally don't take interest even though over the years I have come the understanding that its not haram.