Salman Ahmed Shaikh

It is an empirical observation that people desire to have smooth consumption through their lifetimes. Lifecycle income hypothesis and permanent income hypothesis try to explain that in microeconomic foundation based theories. Both negate the Keynes assertion that average propensity to consume (APC) falls as income rises. Microeconomic evidence is also consistent with lifecycle income hypothesis in various empirical studies in the literature.

In this article, we try to explain how consumption smoothing is achieved and supported in an Islamic economy through a set of institutions and behavioral norms given that people want to spend their lifetime resources fairly equally through their lifetimes.

1. Prohibition of Scrupulous Consumption
2. Fixed Proportional Taxation
3. Automatic Stabilizers
4. Inheritance Distribution
5. Private Transfer Payments: Infaq and Waqf
6. Circulation of Wealth

1. Prohibition of Scrupulous Consumption

Islam discourages lavish consumption, i.e. Israaf (extravagance even in lawful things) and Tabzeer (consumption in unlawful things like liquor, free sex etc). Islam encourages modesty and balance and hence, with rise in income, consumption will not rise proportionally and hence, average propensity to consume for ‘self’ will reduce. However, this may not reduce APC as with increase in income, Islam encourages spending on society with directives for Infaq.

2. Fixed Proportional Taxation

Proportional Zakat linked with income acts as an automatic stabilizer. When aggregate personal disposable income increases, more Zakat is collected and more amount remains at the disposal of government to allocate as transfer payments to Fuqura (poor and needy), Masakeen (extremely poor and needy) and Gharimeen (borrowers in trouble). When personal disposable income decreases, obligatory Zakat also decreases and thereby providing an automatic relief to the income earner who is going through a lean patch. Moreover, fixed proportional income tax will reinforce ricardian equivalence.

3. Automatic Stabilizers

When the personal disposable incomes decline in recessions, more people will become eligible for Zakat. Since Zakat is levied on both income and wealth, the redistribution of wealth will always be functional and operative in an Islamic economy due to wealth Zakat irrespective of the phase of business cycle. Transfer payments to unemployed, poor, needy, debtors etc will continue when the economy faces a recession.

4. Inheritance Distribution

Family system of Islam brings social capital into existence. It ensures empathy and responsibility. It brings a very lasting and durable social safety net. Islamic injunctions about how to treat orphans ensure social security for individuals with special circumstances. Furthermore, the inheritance laws ensure that the wealth of the deceased is distributed widely among the members of the family of the deceased and this permanently and systematically ensures doing away with the concentration of wealth in every generation.

5. Private Transfer Payments: Infaq and Waqf

Private transfer payments in the form of ‘Infaaq’ and through the institution of ‘Waqf’ ensure that people have enough income for their autonomous consumption even if markets are not ready to generate incomes for them during some periods.

6. Circulation of Wealth

With prohibition of interest, the surplus wealth can only be protected against inflation by investing in productive enterprise. That will raise income and purchasing power in the process. In essence, Say’s law of markets could prevail in an economy in which supply is increased through the use of scarce economic resources with intrinsic value who receive compensation out of production process. When supply is created with excessive leveraging, it may not create enough demand and hence result in business cycle fluctuations (unplanned increase in inventory) and recessions.

Alwaleed Bin Talal Foundation has been active for 30 years on the field over 83 country around the globe but unfortunately not in Canada. The Foundation supports the initiative to eradicate polio around the world in collaboration with the Bill Gates Foundation.

The Alwaleed Foundations consists of three philanthropic organizations dedicated to supporting humanitarian projects in Saudi Arabia, Lebanon and around the world. The programs and projects supported by the Foundations are broadly categorized under four Focus Areas: Global Cultural Understanding, Community Development, Disaster Recovery and Women’s Empowerment. Beside the programs under these categories, the Foundations sometimes extend support to several Special Projects based on specific needs of communities. Prince Alwaleed Bin Talal Foundations are driven by the guiding principle of “Commitment Without Boundaries”.
The man know what he is doing, what’s important for him is to give by investing in positive ideas.

Here’s a link to the foundation: http://www.alwaleedfoundations.org

HayatCanada

With the launch of the new S-Class, Mercedes-Benz reinforces its leadership claim in the automotive segment. Experience the passionate innovative power and the ground-breaking design here in the highlight film for the new luxury sedan.

Fuel consumption (combined): 9.1-5.5 l/100 km;
CO2 emissions (combined): 213-146 g/km*

Product may vary after press date on 15.05.2013.

*The data do not relate to a specific vehicle and are not part of the specification, but are merely for the purpose of comparing different vehicle types. The figures are provided in accordance with the German regulation “PKW EnVKV” and apply to the German market only.

Mercedes-Benz TV

(Source: Crescentrating)The exciting capital of China, Beijing is a contemporary metropolis with strong historical heritage. The city offers a wonderful heritage sites, excellent food and gorgeous opportunities for shopping.

Itinerary

Day 1

After Fajr: Early Morning to Mid- Day Destinations

1. Temple of Heaven: A beautiful green park with paved walkways. The Qinian Dian, a pretty and historic hall.

2. Tian’an Men Square: Huge square to the left of which you can see the Great Hall of the People and to the right side is the National Museum. Takes about 3 hours.

Mosques: Niujie Mosque

Halal Restaurants: Niujie Muslim Supermarket Restaurant at Niujie Street, Jubaoyuan at Xi Niujie Li, Nanlaishun Restaurant at Nancaiyuan Jie.

Afternoon: Afternoon to Evening Destinations.

1. Forbidden City: Several attractions here including the Palace Museum, Hall of Supreme Harmony, Hall of Union, Imperial Garden, etc. Takes about 2-3 hours.

Mosques: Niujie Mosque

Halal Restaurants: Niujie Muslim Supermarket Restaurant at Niujie Street, Jubaoyuan at Xi Niujie Li, Nanlaishun Restaurant at Nancaiyuan Jie.

Evening: Evening Destinations and Dining Options.

1. Beihai Park: Has a beautiful lake and hill, great place to relax. Takes about 1 hour.

2. Jingshan Park: Climb the hill here to get some great views of the Forbidden City. Takes about 1/2 an hour.

3. Qianmen Traditional Culture Street: Runs from Jianlou to turning of Tiantan Park.

Mosque: Niujie Mosque

Halal Restaurants: Niujie Muslim Supermarket Restaurant at Niujie Street, Jubaoyuan at Xi Niujie Li, Nanlaishun Restaurant at Nancaiyuan Jie.

Day 2

After Fajr: Early Morning to Mid- Day Destinations.

1. Great Wall: Visit main sights of Great Wall; Badaling Great Wall, Badaling fortress, etc. The tour can take 2 hours. 3 hours for travelling to and from the site.

Mosques: Dongsi Mosque

Halal Restaurants: Beijing Golden Palace International Restaurant at the Golden Palace Friendship Store Co. close to the Badaling Great Wall.

Afternoon: Afternoon to Evening Destinations.

1. Xiushui Street: The Silk Market has a wide variety of silk, cashmere, clothes and leather goods.

Mosques: Huashi Mosque

Halal Restaurants: Yong Feng Lou Muslim Restaurant at Qianmen-Street.

Evening: Evening Destinations and Dining Options.

1. Summer Palace: Built along the Kunming Lake with splendid pavilions and halls. Takes about 2-3 hours.

2. Wangfujing Street: Shop at some of the best malls and plazas of Beijing.

Mosques: Dongsi Mosque near Wangfujing Street

Halal Restaurants: Donglaishun Muslim Restaurant at Wangfujing Dajie, Crescent Moon Muslim Restaurant at Dongsi Liutiao.

Miscellaneous:

• If you have an extra day, visit the Beijing Zoo and climb up the Drum Tower.

• Restaurants: Beijing has a good selection of halal restaurants. The best place to find traditional local halal food is the Niujie Quarter close to the Niujie Mosque.

• Souvenirs: Jewellery, traditional clothing, ivory carving, palace lanterns, silk, etc. The best places to shop include the Wangfujing Street, Qianmen Street, Xidan Commercial Street, Hongqiao Pearl Market, Silk Street, etc.

• Transportation: The best way to travel around is by public transport. Subways are the most convenient means of travelling around. Taxis are also available in the city.

A Saudi woman pilot a plane before driving a car

Prince Waleed bin Talal is proud to present to its Twitter followers the first saudi woman pilot. The woman is in charge of the private plane of the prince. This is a first since this woman has a license to operate an aircraft before she can even drive a car.

Prince works very hard for a woman to have a place in Saudi society.

Make Me a Muslim BBC full movie Documentary 2013
Growing numbers of young British women are converting to Islam. Shanna Bukhari, a 26-year-old Muslim from Manchester, sets out to find out why girls are giving up partying, drinking and wearing whatever they want for a religion some people associate with the oppression of women.

Germany has the largest Muslim population in Western Europe after France. Approximately 4 million Muslims live in Germany, and 80% of them do not have German citizenship; 608,000 are German citizens.1 100,000 of them are German converts to Islam.2 Recent statistics show a continuing increase in their numbers.
There are at least 2,500 Muslim places of worship in Germany, with close to 140 proper mosques with domes and minarets.

1000+ People Converted to Islam in Germany With Yusuf Estes

the Werstern economy is collapsing and the only alternative solution is the Islamic financial system

Loretta Napoleoni is an Italian journalist and political analyst. Her writing appears regularly in many journals and publications, including several European newspapers. She has worked as a foreign correspondent and columnist for several Italian financial papers.

Hazleton’s work focuses on the intersection of politics and religion, history and current affairs. A former psychologist, she reported on the Middle East from Jerusalem for more than a dozen years, writing for Time, The New York Times, The New York Review of Books, The Nation, and Harper’s, among other publications.

The Beauty of Quran

Prophet Muhammad -Where did Humanity Go Wrong?

Salman Ahmed Shaikh

Islamic finance is a growing industry almost everywhere. The key regional hubs of Islamic finance include Middle East, South Asia, East Asia and Europe. The industry is growing at a rapid pace and now, it has presence in Africa, Central Asia and North America. Despite the financial crisis of 2007-09 and ongoing credit crisis, Islamic finance has sustained the growth momentum and hence has appeared as a potent, resilient and possibly an alternate financial architecture for post-crisis financial markets.

In this article, we summarize the results of an econometric study undertaken for full-fledged Islamic banks for the empirical determination of profitability and assets growth. Banks taken in the sample are full-fledged Islamic banks working in Pakistan. The period of study is from 2007 to 2012.

In Islamic banks, net markup income is positively associated with expense and assets and negatively with NPLs. Assets growth has coincided with increase in net markup income. Revenue expenditure in expansion has also improved profitability. Increase in NPLs has dented net markup income growth, but only by less than 10% which is plausible and consistent with observed data.

Net markup income is positively associated with advances and negatively with NPLs. These results are also plausible. Advances are the major source of markup income and apriori; net markup income should be positively associated with advances growth controlling for NPLs. Revenue expenditure in expansion has also improved profitability.

Our results suggest that assets growth is positively related with profitability ratios and is also positively influenced by deposits growth. Negative association between assets growth and finance to deposits ratio is consistent with observed data. In general, increase in finance to deposit ratio is a good signal when financing assets are generated through prudent provision of finance. But, during the period of study, depositors who are leading the assets growth in banks have interpreted decline in finance to deposit ratio as a positive sign amidst high cost of doing business, cost push inflation and high discount rate maintained by the central bank. Hence, they have invested more with Islamic banks considering them more liquid, solvent and prudent in provision of finance.