Lessons From the Financial Crisis

Although its impact is very broad sweeping across the world, it seems very few people understand what and how of this crisis, from where he came from, what government does to deal with and so on. Because little is understood, then even fewer who could take lessons.

So that we could take a lesson, let us become a little class by trying to understand this crisis. I tried writing it with a simple form of the deliverables importance only as follows:

· This crisis originated in the United States; cause the beginning was the act of their central banks the Fed is trying to restore the economy after the events of WTC 9 / 11 with a lower interest rate continuously.

· Low interest rates triggered the families in the United avid to'gadaikan'-house, making their homes a source of money for purposes that are not too important though.

· Since the rampant demand for housing credit is, it gives birth to new opportunistic opportunistic-like Quick Loan Funding provides loans even to people who do not deserve credit, or as Ownit that provide housing loans to 100% - with no security deposit!.

· Credit or loans to people who are not supposed to receive the then-called sub-prime borrowers, is then triggered a wave of crises that are very large and broad impact.

· Dissemination of bad loans was facilitated by the pride of American capital markets - Wall Street - which make investments package 'sub-prime' became like a promising investment. Investors around the world buy these bad investments just because the view is derived from Wall Street in America - which they always imagine as a 'teacher' investment.

· This situation is exacerbated by the emergence of product-product with sophisticated names like Collateralized Debt Obligations (CDOs) that not only are not understood by the layman, but his teacher caliber Alan Greenspan's central bank - also claim to not understand this product.

· Not only individuals, or corporate investors who buy investment products are bad.Even the government institutions were bandwagon-buying.

• In Norway for example there Narvik municipal financial difficulties because of investments on Wall Street, especially on CDOs. Though their investment intentions had been to increase government revenue a mediocre city. Instead of getting extra revenue, they are financial difficulties and need to close schools and services for nursing homes.

· Since the number of bad loans, banks began affected. Trust between them decreases, inter-bank lending liquidity-reduced and eventually disappeared from the market.

· When the world's governments recognize this crisis has occurred and has dragged the joints of the economy at large, they take various emergency measures. But unfortunately the steps they took to it much that would pose a potential long-term crises - such as through the destruction of the currency through its quantitative easing them.

So what lessons from this crisis? many, including:

• Do not build a Riba-based economy; because usury was the one who encourages financial institutions to profit from the interest that must be borne by those who are not able to though.

• Do not owe except for the things that is very emergency. Owe, let alone the usury for purposes that are not forced to - would ensnare the culprit in debt bondage - we were told to hide from her morning and evening.

· For monetary authorities, do not use the instrument of interest (usury) to stimulate economic growth - would collapse (because the enemy of Allah and His Messenger - Sura 2: 275-279)

• For investors, do not invest in products that are difficult to understand. Investment is the real things that you can easily understand.

Allaah knows best.

Season Buy Gold / Dinar

So many questions submitted to me especially from users who are relatively new Dinar. The question is whether now is a good time to switch my investment into the Dinar?, And many similar questions.

 

My answer is always my aim to read the article I mentioned above, but also intrigued me to complete the text above with data that may also be useful as an additional consideration.

 

This data I gathered from Kitco for gold prices over the last five years and I regrouped based on four seasons of Spring (Spring): Summer (Summer), Autumn (Fall) and Winter (Winter). The season that I use are the seasons of the northern hemisphere, because the concentration of the gold market activity is much more prevalent in the northern hemisphere than the south.

 

Then in order to compare consistently from different years, so I created the index at 100 for the month of June (early summer).

 

The results I present in the chart above; pretty impressive too. Consider the average line (average) that the golden; was indeed statistically significant price of gold dinar also tend to be low in the Spring and Summer. In contrast, the price of gold in the Autumn tends to increase and peak in Winter.

 

Statistics last five years in the graph shows the average world price of gold at the end of Autumn is 10% higher than the price at the beginning of the previous Summer. At the end of Winter, the average is even reached 20% above the price at the beginning of the previous Summer.

 

Incidentally if these numbers?; I still think nothing happened on this earth. In Winter humans have more needs at least in terms of energy needs, clothing and food.Because the gold price reflects the price of goods that people needed, then when the demand for these goods increased - prices rise, so is the price of gold.

 

From the statistics of 5 years we will be more easily understood if one of these days that coincided with the beginning of Spring in the northern hemisphere, world gold prices will tend to be low. Statistically, this low position will last until the end of summer is September. Then in late September until late March next year, world gold prices will tend to be high. Even so very important to understand that what happened in the market could be very different from the statistical anomalies can always occur by a variety of factors - both economic factors, political, security and various other global issues.

 

There should also note that the statistics that I use price is the price in U.S. Dollars; pattern gold price / dinar in amount may vary due to fluctuations in the rupiah against the dollar is difficult to predict. Allaah knows best.