Mufti Taqi Usmani: Key Islamic Principles for Reforming the Global Financial System

Society Business and Career
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thought I’d share this gem from one of the top scholars of our time..

Mufti Taqi Usmani writes: In modern economics, we are used to a purely materialistic and secular approach that does not allow religious concepts to interfere with its theories and concepts, on the premise that economy is outside the domain of religion. It is, however, an interesting irony that every dollar note has the admission: “In God we trust”, but when it comes to develop theories to earn dollars or to distribute or spend them, trust is placed only on human ideas based on personal assessments; God is held totally out of picture, as being irrelevant to economic activities!

It is perhaps for the first time that, as an aftermath of the present financial crisis, when different quarters are coming up with different suggestions to solve the problem, the ‘World Economic Forum’ has invited representatives of religion to give their input to the initiative of reshaping the economic set-up on the basis of values, principles and fresh thoughts. This commendable initiative deserves full support from religious circles. As a humble student of Islamic disciplines, and particularly of Islamic economic principles, I would like to highlight some basic points, derived from Islamic economic precepts, that I believe, are essential for independent and fresh consideration while seeking solutions to our economic problems…

…

The worth of total derivatives is reported to be US$ 741.1 trillion in 2008,
while the total GDP of the entire world was only 60.6 trillion. It means that the
worth of derivatives is twelve times more than the gross products of all the
countries of the globe. How big is the number of 741.1 trillion (741100, 000,
000, 000)? When, in 1996, the worth of derivatives was only 64 trillion, Richard
Thomson had remarked:
“How do you imagine a number that big? You could say that if
you laid all those dollar bills end to end, they would stretch from
here to the sun sixty six times, or to the moon 25, 900 times.”

Now calculate if the number has grown in 2008 to 741 trillion, how many times
the dollar notes may stretch to the sun or moon!!!

…

“The whole economy of the world has been turned into a balloon
that is being inflated on daily basis by new debts and new
financial transactions having no nexus whatsoever with the real
economy. This big balloon is vulnerable to the market shocks
and can burst any time.”

Read the entire paper here: usmanipostcrisisreforms.pdf

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Re: Mufti Taqi Usmani: Key Islamic Principles for Reforming the Global Financial Syst

If you had a heart condition, you won't go to a Maulana to seek advice about the exact procedure to be done on your heart.
----- You will only ask the Maulana for a prayer, that the SURGEON does a good job and you recover well.

If you were designing an aircraft, you won't go to the Maulana to seek advice about the number of engines, or the wing span of the aircraft.
----- You will only ask the Maulana for a prayer that your aircraft desinger does a good job and the aircraft flies well.

If you were designing a MODERN financial system, you won't go to a Maulana to seek advice on the nature of derivatives and banking rules etc.
---- You should only ask the Maulana for a prayer that your bank does well.

However if the Maulan starts badgering you about specific steps of your heart surgery, or forcing a certain wing span on your aircraft, or specific rules in your banking system,
then you have to say (politely!).

--- Maulana sahib, I'll send a daig of halwa, so keep quiet please.

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Mufti Muhammad Taqi Usmani was born in 1943 in Deoband, India. He is the son of the late Maulana Mufti Muhammad Shafi, the former Grand Mufti of Pakistan. He obtained his Takhassus degree (an advanced degree equivalent to Ph.D.) in Islamic education from Darul Uloom Karachi, the largest and most renowned Islamic educational institution in Pakistan. He also obtained a Master’s degree in Arabic literature from Punjab University, and a law degree (LLB) from Karachi University.

He is regarded as an expert in the fields of Hadith (sacred traditions of the Holy Prophet, may Allah's peace and blessings be upon him), Fiqh (Islamic jurisprudence), Economics, and Tasawwuf (Islamic spirituality). He has been teaching these and other branches of Islamic education since 1959.

He served as Judge of the Shariat Appellate Bench of the Supreme Court of Pakistan from 1982 to May 2002. He is also a permanent member of the International Islamic Fiqh Academy, an organ of OIC based in Jeddah, Saudi Arabia. He has served as the Vice Chairman of the Academy for nine years. He is also the Vice President of Darul Uloom Karachi.

He is generally known as one of the leading Shariah scholars active in the field of Islamic finance. For more than a decade he has served as chairman or member of Shariah supervisory boards of a dozen Islamic banks and financial institutions in various parts of the world.** He presently serves as Chairman of the International Shariah Council for the Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI) in Bahrain.**

He has held many positions in the higher echelons of the education sector of Pakistan and has participated in numerous commissions set up by the government of Pakistan in the field of education and economics. Since 1967, he's been the Chief Editor of the monthly Urdu-language magazine "Albalagh", and since 1990, he's been Chief Editor of the monthly English-language magazine "Albalagh International." He has also contributed articles to leading Pakistani newspapers on a range of issues. He has authored more than 60 books in Arabic, English, and Urdu.

Positions Holding:
Vice President and Shaikul-Hadith, Jamia Darul Uloom Karachi
Chairman, International Shariah Standard Council set up by the Accounting and Auditing Organization for Islamic Financial Institutions, Bahrain.
Permanent Member, International Islamic Fiqh Academy, Jeddah, sponsored by OIC.
Member, Islamic Fiqh Academy of Rabita-al-‘Alam-e-Islami, Makkah
Chairman, Centre for Islamic Economics, Pakistan since 1991
Positions Held in the Past:

Judge, Shariat Appellate Bench, Supreme Court of Pakistan from 1982 to May 2002
Judge, Federal Shariat Court of Pakistan from 1980 to 1982
Member, Syndicate University of Karachi 1985 to 1988
Member, Board of Governors, International Islamic University Islamabad, 1985 to 1989.
Member, International Institute of Islamic Economics 1985 to 1988
Member, Council of Islamic Ideology 1977 to 1981
Member, Board of Trustees International Islamic University, Islamabad 2004 to 2007
Member, Commission for Islamisation of Economy of Pakistan.

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burqa, think b4 you speak. learn b4 you speak. go dig some history books. and read on current events b4 passing judgment and disrespecting a scholar. by disrespecting him you're disrespecting what ISLAM says about ECONOMY; Allah and his Rasul (saw)!

have just a little shame ok?

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just for the record i want to save this, how you openly disrespect scholars.

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Re: Mufti Taqi Usmani: Key Islamic Principles for Reforming the Global Financial Syst

As CP said, Mufti Taqi Usmani is not your masjid ke hafiz sahab. He is a qualified scholar and is pretty much an authority on Islamic financing and business conducts.

and btw, your local molana may not be a doctor but if your doctor suggests sharaab to be the only cure of your beemari, I am sure you will go to your mufti sahab to get a second opinon. I know that I will.

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Re: Mufti Taqi Usmani: Key Islamic Principles for Reforming the Global Financial Syst

As CP said, Mufti Taqi Usmani is not your masjid ke hafiz sahab. He is a qualified scholar and is pretty much an authority on Islamic financing and business conducts.

and btw, your local molana may not be a doctor but if your doctor suggests sharaab to be the only cure of your beemari, I am sure you will go to your mufti sahab to get a second opinon. I know that I will.

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He is a religious scholar for sure. And I respect him from the bottom of my heart for his "religious" achievements. If I have a question about Wuzu, lota, Jai-Namaz, Hujj, roza, charity etc., I'll read his statements with all the humility that I can muster.

But

Banking scholar?

hahhahah.

He has no banking experience, nor has he taught in big name business / finance schools. And Darul Uloom doesn't cut it as a Harvard of the East.

Thus he has no "bijnass" in the banking business.

We are not living in 1000 AD, that any Tom, Dick, and Anwar can setup a shop of whatever business.

It is not called scholarship, it is instead known as quackery.

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When every Tom, Dick and Harry can interfere in religious matter without being a scholar, why every scholar cannot interfere in 'worldly' matters

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and I'm sure you're part of the World Economic Forum that invited reps of religion to give ideas on how to reshape and fix this mess?

didn't think so.

well said.

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That's a valid argument.

And see how our Maulanas treat those who go out of line form the established religious doctrine.

Maulanas KILL that poor soul or at least give fat fat fatwas for doing so.

Do worldly scholars then have the same rights to issue "death penalties" for the religious scholars?

On a serious note!

If we read the history of medieval Christians, their padris and popes used to run every aspect of life of their poor subjects aka Chrisitans.

Earth was uniformly flat, and
Everything including the poor sun was revolving around the perfectly flat earth.

Then a time came, that bright intellectuals of Europe got rid of the padri's yoke and did a phenomenal progress in science, arts, and philosophy.

Fast forward to the declining years of Khilafat (doesn't matter if it was Usmani Khalifas, Abbasis, or Umvis), Maulanas ruled the roost.

They would issue fat fat fatwas on everything.

And we can see how Turks dealt with the fat fat fatwas.

And then the Turkey became a decent power again.

Pakistan too is in the straight jacket of Ulema's interference in every aspect of our life.

In some cases we cut off their yoke, but in some areas they still wield a significant power if not simple ghunda gardi in the street.

And thus our life these days in Pak is just like the medieval Christian Europe, or the life of Usmanis in their declining years.

So the choice is really ours.

We listen to the quacks or go to the real experts.

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So Mufti sahib went to the a meeting, made a speech, and had tea with biscuits.

The question is!

If Tim Geithner and major European Finance managers are inviting Mufti sahib for anything more than chai and samosa.

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lol, the same Tim Geithner the liar that's being grilled in hearings? :D

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BP, I totally disagree with your analysis in post #10. I want to remind you that every person who has a beard and chanting Allah o Akbar before committing a fanatic act is not a scholar. In fact none of those people who are committing fanatic acts in the name of Islam are real graduated scholars.

With due respect to CP, I give you example of Abdul Rashid Ghazi, and his brother Abdul Aziz Ghazi (of famous Lal Masjid incident)

Abdul Rashid Ghazi was not a scholar (in fact against his father wishes, he went to Quad-e-Azam university and studied in co-education system) so ended up being influenced by some manipulators who used him and convinced him to be in the party of armed rebellion act. His older brother Abdul Aziz Ghazi is a graduate from Banoria town madrasa of Karachi and hence had a cooler, moderate attitude and did not become party of any violent act.

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Re: Mufti Taqi Usmani: Key Islamic Principles for Reforming the Global Financial Syst

^ Bro, in my thread I never called Abdul Rasheed a scholar. Never put Maulana as a title beside his name as some people do. I created it to say how the army handled the situation was uncalled for and I recognize the people who died in that as shaheed, that's my personal view, also I never agreed to how the people in Lal Masjid carried out their agenda in the first place. That's all. =)

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Re: Mufti Taqi Usmani: Key Islamic Principles for Reforming the Global Financial Syst

I know that you never called him scholar, but I did not want to show any disrespect towards your feelings for him. And I was just comparing him with his older brother. That is it.

We can take example of 19 of 9/11 guys. None of them were scholars, in fact some of them had girl friends and used to visit bars. Point is, it is extremely unfair for the critics to blame scholars for the downfall of any society. Downfall happens because of people who never understood Islam properly.

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Bhai,

In my post #10, I was referring to the big name scholars and Imams who can declare a scientist, or a researcher as a heretic, and issue fatwa on his death.

That was in response to your assertion that religious scholars can make statements about non-religious topics.

The bottom line is that non-religious scholars can generally make statements and form opinions without declaring others heretic (and fatwa bazi etc.)

But the religious scholars do commit this intellectual crime.

Hope this clarifies things.

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Maybe they just give fatwa, but do not act upon it.

Worlds major catastrophes and mass killings were done by non-religious people, not by religious scholars.

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That's true. Hitler wasn't a Mullah.

However in many of the wars, religious scholars did overtly or covertly support the fighting.

But your point is still valid.

True.

There is the act of murder,

And then

there is incitement and conspiracy to murder.

One may be lesser than the other, but still both are crimes.

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Re: Mufti Taqi Usmani: Key Islamic Principles for Reforming the Global Financial Syst

I have dealt with Mufti Sahab in the Past, the dealing was purely to seek his approval to join a Sharia board of (then) upcoming financial institution, based on his views, any body have a right to agree or dis-agree, but his knowledge on Islamic Financing is unquestionable and he is one whom often several business-minded/ profit-oriented Islamic financial institution often look to get an approval for innovative product for their institution.

It is because of people like Mufti Sahib ( although i personally disagree with him on certain issues) Islamic Financial markets are gaining in the world where everything is interest based. Hopefully we'll have more like him in Pakistan...

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burqa little knowledge is very dangerous .......... specially when u use this knowledge for criticising other who is very high profile and competent person.

Recently i have bought a book comprised of his judgment that he has given as member of federal shariah court. in his judgement he has discussed the pre emptive right, sale of good act, rent laws, Qasas and Diyyat , right of ownership of the property, rajam, pension and benovolent fund and many other worldly and purely religious issues. i think his point of view and the expression was amazing.

Further he is considered to be the authority on Islamic finance and members of many bodies all across the globe working for the promotion and policy/procedural guidance for the Islamic institution.
i m sorry to say i have noticed that whenever ur comments on the threads related to economics, finance etc. is generally ridiculous and rarely supported by a logic and factual data that speak volumes of ur ignorance about the subject. At least google about the subject atleast before u rite nething.

i condemn the way u have discussed the learned scholar .........like halwa sort of thing.