The Usury.
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No. Stock trading is simple, it's not usury in any way (though the company might be involved in it). All you are doing is buying a share in the ownership of the company - nothing more. Usually you get a share of the profits, but the thing is, the value only goes up with demand for that stock - when other people want a slice of the pie. I think Jonny_K put it nicely.
Usury on the other hand, instantly creates money - money that does not exist. If people can't keep up and work for it, then it all collapses. In other words, it just forces people to work even harder, and most of the time, that's not a good thing.
Peace
I think that means if you cannot afford to pay the principal you will be indefinitely charged until you pay them back and the amount they charge is "created" because it wasn't part of the original sum.Al
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Peace
I think that means if you cannot afford to pay the principal you will be indefinitely charged until you pay them back and the amount they charge is "created" because it wasn't part of the original sum.Al
Yes, that's precisely what I meant. You put it better than I could rotfl
For an example as to why usury in this form is evil, look no further than the whole continent of Africa.
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Peace bro "OPF",
When you say, take a mortgage out on a ?100,000 house, the overall repayment sum will be around ?250,000 after 25 years. Where does this 250k come from? Someone has to work their ass off to get it.
JK- But the person knows this AFORETIME that if he doesnt return the money before that itd amount to that much. Its all precalculated. The formula for the amount to be returned is (1+i/100)^n times the mortgage, where i is the interest rate of the currency in %age and n the no of yrs. So the person can check everytime. If the person fails to give the complete payment at any time and decides that he wont be able to pay no more he can cancel it. Then the bank would calculate accordignly. Say he paid for 12 months, 1000 pound per month so thts 12000 he has paid. Now he took a loan of 100,000 and with that the house was bought plus his interest is due and its 5000 pounds. Now the person has the option 1) he can either sell the house himself or 2) let the bak sell it for him. In the latter acse the bank will just try to sell it at 100,000-(12000-5000)=93,000 GBP since then it has your 12000 which fulfills its requirement but youve paid for nothing. So option 1 would be wise and who knows you might sell it for 150,000. I would actually go for that. Be smart. Try real estate arbitrage. Go out and see how much people might be willing to pay for certain houses. Then if your sure make lowest possible option contracts with the owners of those houses so tht they cant sell it themselves once the other party is known and if the other party is willing to pay buy it through mortgage and sell it right off to the other who alreaady agreed to pay. This stragedy too can be done and smart businessmen do it. The loss would be merely the option paid. GOD Bless!
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Peace "aalmaako",
Peace
I think that means if you cannot afford to pay the principal you will be indefinitely charged until you pay them back and the amount they charge is "created" because it wasn't part of the original sum.Al
JK- Suppose a renter of an appartment has to pay 100 GBP monthly. He however doesnt pay for 3 consecutive months. Should the owner only charge 300 GBP after three months time when hes finally able/willing to pay? The answer is NO because the owner of the app cldve worked with the money had it been paid to him on time so he needs to be compensated for tht. The min he cldve made safely is put tht money in the bank and get interest of 5% per annum. Some banks offer monthly interest so thtd be "*100%" which wld be appx .407% per month. So for three months *100% wld have to be added which is appx 1.23% to the first 100 making tht 123 plus same formula with power 2 and then percentage of the 100 for the second month plus the 100 GBP for the 3rd one. Tht wld be more than just 300. GOD Bless!
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Jonny_K, we're assuming it's one of these modern loans where you have to pay extra for paying up early.
The problem is not that the amount payable is unknown because it isn't. The problem is that it makes a void of non-existant money, and someone has to work for that. If there is too much of that, nobody can keep up with the repayments and everything collapses - see Africa for an example. It makes economic slaves out of people, whether or not it is agreed to by both parties. The compounding interest is even worse. In certain situations, the original amount has long been paid, and all that remains is an endless supply of money for the lender in the form of interest. Is the lender earning that money in any way, shape or form? No. Is that money supposed to exist? No, because it's not likely that the borrower has the material goods needed - without that, money is only paper. In Africa, the principal has long been paid off but all those countries are still slaves to the world banks because of the interest.
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Peace all,
I think a lot of people don't have the right concept of how paper money is generated and what it really means. Paper money is generated out of thin air whenever someone borrows money from a bank and is not backed up by any thing of real value like gold or silver. The banks don't really lend you any money of their own. Then they charge you interest on money they never lent ! The government is in on it and has a sneaky pact with the banks and prints the extra paper money whenever a loan is generated. This paper money has no real value. There is still no money to cover for the interest that is being charged. It is a scam and a vicious cycle that will eventually collapse and render all the paper money useless.
Please see the following video for details
http//video.google.com/videoplay?docid=-9050474362583451279
Sister Dotty,
Buying stock in an ethical company to get percentage of the profits (dividends) is ok but to trade stocks on its value is gambling because the intrinsic value of stocks is PURELY SPECULATIVE and does not depend on how the company is actually performing. That is why even when a company makes a huge profit but falls short of the expected earnings by even a cent, its stock value falls, if previous to the earnings announcement people were speculating that it would exceed or meet the expected earnings.
I think that according to the Qur'aanic principles, any interest is forbidden. Please see the following post by brother Latif
http//free-minds.org/forum/index.php?topic=12997.msg106771#msg106771
The only thing allowed might be extra amount charged by the lender to meet the decreasing value of paper money with time due to inflation. This is due to generation of extra paper money out of thin air without being backed up by any thing of real value like gold or silver, as explained in the video above. But even this might be wrong because the paper money itself is being generated in a wrong manner. The whole system is corrupted and needs to be entirely revamped.
Any money generated after taking a risk of loss with your own money would be ok. If one lends money to another person and then charges interest, the money generated by the interest would be without any risk and would be forbidden. In the example of renting an apartment to someone, if the tenant does not pay the rent on time, the owner has no right charging the tenant interest on that money because of what profit the owner COULD have made on that money, because then there is no risk.
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Sister Dotty,
Buying stock in an ethical company to get percentage of the profits (dividends) is ok but to trade stocks on its value is gambling because the intrinsic value of stocks is PURELY SPECULATIVE and does not depend on how the company is actually performing. That is why even when a company makes a huge profit but falls short of the expected earnings by even a cent, its stock value falls, if previous to the earnings announcement people were speculating that it would exceed or meet the expected earnings.
This is why I said earlier that MAYBE I can separate stocks from gambling. It's still hard for me.
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Peace bro "OPF",
Jonny_K, we're assuming it's one of these modern loans where you have to pay extra for paying up early.
The problem is not that the amount payable is unknown because it isn't. The problem is that it makes a void of non-existant money, and someone has to work for that. If there is too much of that, nobody can keep up with the repayments and everything collapses - see Africa for an example. It makes economic slaves out of people, whether or not it is agreed to by both parties. The compounding interest is even worse. In certain situations, the original amount has long been paid, and all that remains is an endless supply of money for the lender in the form of interest. Is the lender earning that money in any way, shape or form? No. Is that money supposed to exist? No, because it's not likely that the borrower has the material goods needed - without that, money is only paper. In Africa, the principal has long been paid off but all those countries are still slaves to the world banks because of the interest.
JK- I dont think you got what i was trying to say. Compound Interest is ONLY A NAME given to a payment DUE TO DELAY IN RETURN. Thts why its there. It is absed ont eh concept that TIME IS MONEY which it obviously is. If you dont payback your loan fees on time in case of currencies after a yr then tht means youve now taken your fees as a further loan and you need to pay your "rent" on that too. Is it clear now? GOD Bless!
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Peace bro "OPF",
JK- I dont think you got what i was trying to say. Compound Interest is ONLY A NAME given to a payment DUE TO DELAY IN RETURN. Thts why its there. It is absed ont eh concept that TIME IS MONEY which it obviously is. If you dont payback your loan fees on time in case of currencies after a yr then tht means youve now taken your fees as a further loan and you need to pay your "rent" on that too. Is it clear now? GOD Bless!
Must have gotten lost while reading
I can't find the words, what I mean is interest that will result in a flow of money that should not exist.
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Peace bro "Tanveer",
Buying stock in an ethical company to get percentage of the profits (dividends) is ok but to trade stocks on its value is gambling because the intrinsic value of stocks is PURELY SPECULATIVE and does not depend on how the company is actually performing. That is why even when a company makes a huge profit but falls short of the expected earnings by even a cent, its stock value falls, if previous to the earnings announcement people were speculating that it would exceed or meet the expected earnings.
JK- Ok now we need to define ethical companies. Again this boils down to self responsibility and proper research. Reg speculation theres a certain amount of tht in EVERY APECT of our lives. To give just a simple example when you walk down the stairs in your house you SPECULATE they nobody has altered them or they wernt damaged through rotting from the rpevious day and you continue to run down as you always do. So its everywhere and GOD wants us to USE OUR INTELLIGENCE AS MUCH AS POSSIBLE and if we do that trading stocks then thts perfectly fine. GOD Bless!
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Peace bro "OPF",
Must have gotten lost while reading D
I can't find the words, what I mean is interest that will result in a flow of money that should not exist.
JK- Well from your example tht could arise out of plain rent as well. Suppose a person who doesnt have any money signs a contract for renting an appartment. Infact thts wht happened with my grandfather. A young girl who didnt have any money signed up for an appartment in my Grandfather*s building and then she wasnt able to pay. Gave him alot of troubles. Now she says shes gonna pay it back later in stages. So tht really aint restricted to compound interest only but due to the fact of indivduals IMPROPER CALCULATION of their expenses. GOD Bless!
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Peace sis "dotty",
This is why I said earlier that MAYBE I can separate stocks from gambling. It's still hard for me.
JK- Its really quite simple. Gambling is where you would ultimately lose if you invested your money in tht event for infinity meaning the overall prob of gaining profit remains less than 50% such as in the games at casinos unless you use illegal manipulation tactics which if you get caught can cost you your life for those are mostly mafia criminals. In the stock market your intelligence raises the prob and theres a possibility of it being considerably above 50% which means with continuous trading you make profit. Now it all depends on your research. See the difference? GOD Bless!
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Peace bro "OPF",
JK- Well from your example tht could arise out of plain rent as well. Suppose a person who doesnt have any money signs a contract for renting an appartment. Infact thts wht happened with my grandfather. A young girl who didnt have any money signed up for an appartment in my Grandfather*s building and then she wasnt able to pay. Gave him alot of troubles. Now she says shes gonna pay it back later in stages. So tht really aint restricted to compound interest only but due to the fact of indivduals IMPROPER CALCULATION of their expenses. GOD Bless!
No, I meant a money supply purely based on no principal. As I said, those African states have paid off the original amounts long long ago - they are now paying purely the interest accumulating on the interest accumulating on the interest.
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Peace "OPF",
No, I meant a money supply purely based on no principal. As I said, those African states have paid off the original amounts long long ago - they are now paying purely the interest accumulating on the interest accumulating on the interest.
JK- Reg Africans those are poor nations and they shld obviously be forgiven any further payments. Thts a whole other story. Say if one takes a billion dollar loan but then looses everything cld he/she ever pay tht back. Not very probable, with or without interest/compund interest. So thts totally different. Now why should a normal and healthy guy whos busines is running properly not pay the compound interest? He can see exactly how much he has to return by using the formula X initial loan, where i is the interest rate in %age and n the no of yrs. So if the irate is 5% hed know tht hed have to return appx "3.39 x initial loan" after 25 yrs. He knows this in advance if he knows the formula which every bank provides. Yes if at any time his business flops the bank must stop any further loan FROM THT TIME ON BUT HE HAS TO COME AND PROVE THT TO IT THROUGH VERIFIED INSTITUTIONS. Thts the whole pt. GOD Bless!
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Peace JK, Dotty, all,
To give just a simple example when you walk down the stairs in your house you SPECULATE they nobody has altered them or they wernt damaged through rotting from the rpevious day and you continue to run down as you always do.
That speculation is COMPLETELY different from the PURE SPECULATION which results in wild fluctuations of stock values making them COMPLETELY UNPREDICTABLE with THE ODDS STACKED AGAINST YOU, just like gambling. The pure speculation determining the stock values turns the odds against you due to their complete unpredictability, and also the difference in buy and sell prices and the commission fees of the brokerage firms stack the odds against you.
The buy price (bid) for the trader is always higher than the sell price (ask), so that the middleman (market maker or specialist sitting on the exchange floor) ALWAYS WINS by buying at a lower price (ask) and selling at a higher price (bid). The buying price for you (bid) is the selling price for the market maker and the selling price for you (ask) is the buying price for the market maker. IN addition to that, the brokerage firm charges you a commission fee for doing the trade for you. Hence, if you buy a stock and then IMMEDIATELY sell it you will lose some money because of the difference in buy (bid) and sell (ask) prices and the commission fees.
So to win in stocks, the odds are stacked against you from the beginning JUST LIKE GAMBLING. In gambling the game is designed in such a way that the odds are stacked against you, plus they pay you less than what is expected according to the odds, which is called the vig.
Bro JK, please take a course in stock trading and work in an investment firm like I briefly have and read 20 books on gambling systems, before making false analogies and also misguiding others.
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confused here. I feel like I am back where I started. In my gut I have felt for years that playing the stock market was like gambling. Now in this thread I feel like a ball in a pin ball machine. Stocks are gambling, stocks are not gambling, gambling, not gambling... and so on. I think I should have started a new thread instead of posting about stocks here, but I was feeling like stocks were in the same category of usury, or at least a cousin of it.
I have to put some more thought into this. Thanks for everyone's imput.
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Peace sis Dotty,
No need to be confused. Please do your own research about stock trading as per the advice of 1736, instead of following all the "hearsays" and read some good books on it or even take a small course on it and the truth will become manifest/evident/apparent to you, God willing. !
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confused here. I feel like I am back where I started. In my gut I have felt for years that playing the stock market was like gambling. Now in this thread I feel like a ball in a pin ball machine. Stocks are gambling, stocks are not gambling, gambling, not gambling... and so on. I think I should have started a new thread instead of posting about stocks here, but I was feeling like stocks were in the same category of usury, or at least a cousin of it.
I have to put some more thought into this. Thanks for everyone's imput.
It is gambling when you don't do your research. Long term investment is not gambling. Buying and selling like a madman based on speculation is gambling. It is also a pretty useless thing to do.
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Peace sis Dotty,
No need to be confused. Please do your own research about stock trading as per the advice of 1736, instead of following all the "hearsays" and read some good books on it or even take a small course on it and the truth will become manifest/evident/apparent to you, God willing. !
Solid point brother tanveer. Thank you.
It is gambling when you don't do your research. Long term investment is not gambling. Buying and selling like a madman based on speculation is gambling. It is also a pretty useless thing to do.
I think I will do my research. I can say that I have more ideas about the whole issue. I really do appreciate all the imput. God bless.
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Peace OPF, all,
How long and when do you determine the exit point ? Many people have lost their shirts even in long term investments even though they did extensive research before buying the stocks.
One can do all the research in the world and buy a company that apparently has good fundamentals, good product, good business model, and strong earnings and profits, and its stock value steadily goes up for many years. Everyone is bullish on this company and then one day the company fails to meet its expected earnings whereas the speculation was that it would meet or exceed its earnings, and even though it still made huge profits and is still strong, its stock value can plummet like a rock overnight, causing one to lose all one's hard earned money. No amount of research can predict that.
The problem is that the stock value of a company is based on pure speculation that it is going to over perform or under perform what is expected, and NOT ON THE ACTUAL PROFITS. Some companies can have poor fundamentals, no profits for years and poor business models but just because there is SPECULATION that it is going to perform better than expected, its stock value can be disproportionately high, and it can plummet overnight when it fails to meet expectations. Such companies are considered overvalued with inflated stock prices. Some companies can have strong fundamentals, good earnings and profits and strong business models, but just because there is SPECULATION that it is going to perform worse than expected, its stock value could be disproportionately low for a long time and then suddenly one day it can shoot up or can also go down further depending on the actual earnings in reference to the speculated expected earnings, irrespective of the actual profits. Stock values are thus based on SPECULATION rather than the actual strength of the company and they are not an accurate indicator of the company's real intrinsic value.
Then there is the matter of insider trading. The people actually running the company have an unfair advantage of knowing when the company is going to over or under perform and can unfairly exercise their stock options to their advantage before the general public comes to know about it. The stock exchange market has loaded the odds against the general public holders of the stock by making it illegal to trade based on insider information thus giving them a distinct disadvantage by making the rules of the game against them.