Islamic Banking Is the Solution to Wall Street Issue
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The world is in the midst of a financial crisis which threatens a worldwide economic recession. Occupy Wall Street (OWS) is an ongoing series of demonstrations initiated by the Canadian activist group Adbusters which began on September 17, 2011 in Zuccotti Park, located in New York Citys Wall Street financial district. The protests are against social and economic inequality, high unemployment, greed, as well as corruption, and the undue influence of corporations–particularly from the financial services sector–on government in the United States. The protesters slogan –We are the 99%‖ refers to the growing difference in wealth in the U.S. between the wealthiest 1% and the rest of the population. The third world has also not been spared, Bangladesh, Indonesia, Malaysia, Pakistan, South America, Africa as well as the Middle East were all sold the idea of free markets, and all of these regions and nations now have capitalistic financial markets where large sums of wealth are the subject of speculation on the state of the economy and future revenue flows.
The Bank for International Settlement (BIS) has mentioned on its 2008 annual report that the root of almost all crises has been excessive and imprudent lending by banks. Furthermore, this factor also becomes important cause that makes this current crisis happen, which was boomed with defaults of subprime mortgages in the United States on 7th February 2007 (Sakti, 2009).
Overview of Occupy Wall Street Movement and its Outcomes
There exists a whole host of specific factors inherent within capitalism that caused the current credit crunch, food and oil crisis. Figure 2 highlights the percentage of respondents who believe that OWS Movement is leading to conditions similar to Middle East in the United States. Such factors continue to plague the western economies and all those who have imitated them. Furthermore, this credit crunch has also highlighted the fragility of capitalism and the free-market economy, as the fallout from the credit crunch and the wider economic crisis continues, demands for alternatives are certain to grow. Figure 3 shows the percentage contribution of political factors which led to civil disobedience through OWS Movement.One of the alternatives to global economic problems is the shift of financial paradigm to Islamic Banking. Islamic banking refers to a system of banking or banking activity that is consistent with the principles of the Shariah (Islamic rulings) and its practical application through the development of Islamic economics. The principles which emphasize moral and ethical values in all dealings have wide universal appeal. Shariah prohibits the payment or acceptance of interest charges (riba) for the lending and accepting of money, as well as carrying out trade and other activities that provide goods or services considered contrary to its principles. While these principles were used as the basis for a flourishing