Preventing the next financial crisis: Does islamic finance hold the key?

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dc.contributor.authorMuhammad Imran Ejaz
dc.date.accessioned2016-03-31T05:16:44Z
dc.date.available2016-03-31T05:16:44Z
dc.date.issued2015
dc.descriptionSupervisor: Dr. Talat Hussainen_US
dc.description.abstractThe Capitalist system has undergone numerous crises in its history and they seem to come one after the other. The Financial Crisis of 2007-2008 shook the whole foundations of the International Financial architecture and raised further questions as to what was inherently wrong with the system. Eyes turned towards the principles of Islamic Finance to see if here lay the answer to the problems facing the financial system in place in the world. This study has aimed to answer the question as to whether Islamic Finance principles offer a solution to preventing Financial Crises. Initially an analysis of the Conventional (International) and Islamic Monetary systems has been made in this study. This study has then gone on to analyze three crises ; Black Wednesday 1992-the currency crisis that shook Britain ; East Asian Currency Crisis and the Financial Crisis of 2007-2008.The mechanisms and the causative factors of these crises have been studied and isolated. These causative factors have then been studied under the light of Islamic Finance principles. In order to arrive at answers the methodology employed has been analysis of existing literature and use has been made of podcasts of leading financial experts. Access to experts who are at the same time well versed in knowledge of the workings of the International Monetary System and Islamic Finance is very difficult and limited. The study is unique in studying the Black Wednesday Currency Crisis in the light of principles of Islamic Finance. The researcher has not come across any previous study carrying out the above mentioned task. This study is also distinguished, from any previous work, in analyzing these three crises from the perspective of Islamic Finance as the contents of one thesis. The study has shown that the underlying causative factors of the three crises are in violation of the principles of Islamic Finance. The main causative factor behind the Currency Crises is shown to be the ability to carry out a Speculative attack which is possible due to the facility of short sales. The study shows that short sales are contrary to the teachings of Islamic Finance. Likewise the role of speculation in the 2007-2008 crisis is also highlighted along with the other causative factors. The study concludes that if the causative factors isolated in the three crises, which are in violation of the rules of Islamic Jurisprudence and still persist in the system, are removed from the International Financial Architecture then this system would be given great stability and the chances of a further crisis would significantly diminish.en_US
dc.identifier.urihttps://escholar.umt.edu.pk/handle/123456789/1651
dc.publisherUNIVERSITY OF MANAGEMENT AND TECHNOLOGYen_US
dc.subjectMS Thesisen_US
dc.subjectFinancial Crisisen_US
dc.subjectIslamic Financeen_US
dc.subjectCurrency Crisesen_US
dc.subjectInternational Monetary System and Islamic Financeen_US
dc.titlePreventing the next financial crisis: Does islamic finance hold the key?en_US
dc.titlePreventing the next financial crisis: does islamic finance hold the key?en_us
dc.typeThesisen_US
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