People like to put up binary choices. Bitcoin Vs. Dollars, Gold Vs. Yuan, Private bank money vs. really bad managed money supply.
I am in the opinion that we should experiment with models other than a bunch of academics with no real practical experience getting together every month and deciding on the fate of the world economy. I am sure we could come up with something better.
The Islamic financial model has not been looked at properly by non-Muslims. It works, but it won't allow a few people to get rich by manipulating the market or by lending out money as we have in the rest of the world today.
Considering it forbids making interest, that would be a seismic shift, although it is interesting and worth looking into. Wikipedia makes it sound like Muslim countries are having difficulties sticking with the 'no interest' premise, though:
"Islamic banking and finance — the industry built around avoiding interest and other financial practices found in violation of sharia (Islamic law) — has been both praised and criticized by observers.
The industry has been praised for turning a "theory" into an industry that has grown to about $2 trillion in size; for attracting banking users whose religious objections have kept them away from conventional banking services, drawing non-Muslim bankers into the field, and (according to other supporters) introducing a more stable, less risky form of finance.
However, the industry has also been criticized for ignoring its "basic philosophy" and moved in the wrong direction over the decades — leading both outsiders and rank and file Muslims to question it. This has happened first by the sidelining the original finance method advocated by promoters — risk-sharing finance — in favor of fixed-markup finance of purchases (particularly murabaha), and then by distorting the rules of that fixed-markup murabaha, effectively delivering conventional cash interest loans following conventional interest rates, but disguised with "ruses and subterfuges" and burdened with "higher costs, bigger risks".
Other issues/complaints raised include a lack of effort by the industry to help small traders and the poor; the question of how to deal with inflation, late payments, the lack of hedging of currencies and rates or sharia-compliant places to park short term funds for liquidity; the non-Muslim ownership of much of Islamic banking, and the concentration of what ownership is in Muslim hands."
Islamic finance goes back way before the present day manifestation. Many "Islamic finance providers" aren't Islamic FYI. So when reading a wikipedia article or any other source, that must be taken into consideration. For example, the "fixed markup" financing has been heavily criticized by Islamic scholars as basically nothing but interest. We definitely need better financing models.
Yes, prohibiting interest is a seismic shift, but at the end of the day, it's going to be better off for everyone. Islam lays outside the capital-communist spectrum, and is basically the best of all worlds.
Islamic finance goes back way before the present day manifestation. Many "Islamic finance providers" aren't Islamic FYI. So when reading a wikipedia article or any other source, that must be taken into consideration.
Yes, prohibiting interest is a seismic shift, but at the end of the day, it's going to be better off for everyone. Islam lays outside the capital-communist spectrum, and is basically the best of all worlds.
Please propose a theory of change then instead of handwaving[1]. We need effective people to make the world better. I've seen lots of complaining about the fed from crypto people but almost no theory on how to manage our economy and incentive systems to bring a more prosperous world.
The whole crypto system is basically a real, evolving mechanism of evaluating different monetary systems. Don't like it how Bitcoin is structured? Fork it and see how the market reacts.
Wants a centralized version of Ethereum when checks and balances? Israel is building that.
You can even build an Islamic monetary structure enforced by smart contracts (addressing sibling comment: historically Islamic financial systems collapsed because they are enforced by corruptible people).
Like all things, most experiments would fail (and most people shouldn't put their savings in experiments!). We might end up with even a worse monetary system (unlikely imho, because I believe the markets are free to accept and reject those experiments). I won't fight it though - the markets are brutal, and in time, kills bad ideas. I do want the experimentations to happen though!
Look at how Islam addresses these problems. From prohibiting interest, to having a built in "wealth tax" (Zakat), to prohibition of selling what you don't own, to no gambling, etc. Solid principles that work.
There's a silver standard and multi-metallic standards, and I'm really hoping there's a hilarious story behind this sentence from wikipedia: "Great Britain accidentally adopted a de facto gold standard in 1717 when Sir Isaac Newton, then-master of the Royal Mint, set the exchange rate of silver to gold too low, thus causing silver coins to go out of circulation." (https://en.wikipedia.org/wiki/Gold_standard) (Apparently, the US's introduction to the gold standard was also accidental, caused by the 1849 California gold rush.) Unfortunately, those systems didn't prevent a crash about every decade. (https://en.wikipedia.org/wiki/Financial_crisis#19th_century)
Or you could let things float, like exactly nobody else does. I'm sure that won't be rife with corruption, bank failures, and its own boom and bust cycles.
