From: hubey@pilot.njin.net (Hubey)
Newsgroups: soc.culture.turkish
Subject: Re: ERBAKAN HOCA ve EKONOMIK PROGRAMI (Islamcilardan secmeler)
Date: 22 Dec 92 19:50:08 GMT
Organization: Rutgers Univ., New Brunswick, N.J.

From emev02@castle.ed.ac.uk (H Oral) Tue Dec 22 11:36:52 1992

>  Bugun bir is yapmaya kalkan biri bankadan kredi almaya kalksin.  Bu krediyi
>daha sonra belli bir faiz yuzdesi ile geri odemek zorundadir.  Ister
>kalkistigi is basarili olsun, ister olmasin.  Boylece banka kesinlikle
>kaybetmeden her seferinde paranin ticaretini yaparak kolay yoldan risksiz
>kazanir.  Is adami ise aldigi parayi isletebilirse ve borcunu faiziyle odeyebi
>se kendini kazanmis sanir.  Eger basarili olamazsa artik neyi karsilik
>olarak gostermisse bu mallar elinden gider.

It doesn't follow. If a bank lends $10 million and the guy goes bankrupt
how does the bank get all its money ? Why is there no risk? 

There's always a risk in lending money. If the banks refuse to lend 
unless it's completely risk-free, then their money will sit on the
shelves collecting dust. The best thing that can happen to that
money will be if it actually got to own a business--a cash cow.



>Islami bir isletme ise kredi verdigi taktirde HEM KARDA HEM DE ZARARDA
>ORTAKTIR.  Iste Erbakan'in bahsettigi adil duzenin bir uzantisi en basit
>bir ornekle budur.  Adalet!  Tabii ki bu para babalarinin isine gelmediginden
>boyle bir adil esit risk, esit kazanc ve kayip yolunu tercih etmemektedirler.

There are advantages and disadvantages if you look at both systems in
a simplistic way. The fact of the matter is they're the same if
you analyze them from the point of view of the mathematics of risk.
It depends on what you think is preferable, giving a part of your
business away or taking chances on your ability to run your business.


I'll just explain in words. If the risk is too great you'll only
be able to find money at high interest rates, maybe from the mafia.
On the other hand, no one will become your partner for a small share
if the risk is high. Whoever puts up money for a high-risk venture
will want a lot for his money. The people who run the 'Islamic Bank`
are not there to throw away their money. They want a good return for it.

Even if they actually can offer good deals for a while to some
businesses they can't do it forever since that guarantees bankruptcy.
They can however do it for a short while to gain market share and to
drive the others bankrupt. There are will known tricks from the
last century; ruinuous price-cutting, fixing rates, raising prices
when a monopoly is established, using profits from areas where there
is a monopoly to cover the losses in areas where the prices are cut
to drive the competetion bankrupt.....etc

Islamic banking will the easiest way for petrodollars of sheiks
to buy up businesses built up from scratch with much sweat. Especially
for a country like Turkey which cannot sell vast quantities of 
natural resources on the world market, it would mean that all Turkish
businesses, state enterprises, banks would be owned by petromoney.

The banks that have the big buck only know about money and nothing
about other businesses. What's the ideal way for them to buy up
other businesses ??  If the businessmen don't want to sell, they can't
buy anything. They can only lend money. On the other hand, if Islamic
banking becomes law in Turkey, all the businesses will eventually be
owned by banks. Is this what everyone wants ?

Conversely, if it's practically a guaranteed loan (i.e. the business is
worth $100 million and you only want to borrow $1 million), you can get
loans at low interest rates. Similarly, you will be able to negotiate
loans at very small partnership percentages since this kind of a
business will look attractive to investors. 

What this boils down to is that the banks are not just money lending
institutions but get directly involved in businesses and become
partners. Sometimes you don't want people who don't know anything
about your business to make decisions i.e. you don't want them
to be partners.  This is how the 'mafia' muscles into new businesses.
They lend money and become partners. Would you not prefer borrowing
money and paying it off and managing your own business ?

It all depends. If you want to sell part of your business to raise
money you don't need "Islamic Banking" to be able to do it.
The stock exchange will take care of it. In fact, there are investors
out there looking to buy into (or buy out) good busineses all over the world.
Now if the real intent of 'Islamic Banking` is for Iranian and Kuwaiti
banks to own all the businesses, scientific establishments, and state
enterprises in Turkey, I can't find a better and quicker method to
accomplish this than to make 'Islamic Banking' the law in Turkey. 

If it's so great and the banks really charge no interest, then why
doesn't the TRT invite some representatives of these banks to an
interview and debate on TV and let the people decide. 

Now the real question is this. What percent of those hungry and illiterate
souls in Istanbul's slums really understand what 'no-interest in Islamic
banks' means ? It would not surprise me if a great percentage of them
actually think that they can borrow tons of money to pay back N years
later with money inflated at 80%/year rates. Who says ignorant people
are stupid ?  :-).. Has anyone taken a poll of what these people
voting for RP really understand of interest-free banking ?
Do they know that they have to pay a hefty commission or pick
up unwanted partners in the process ? Do they know that a loan is
never guaranteed?  Who says anyone needing money will always get it?

Do people think those banks are forced to go partners with every
Hasan and Huseyin that's got a grand scheme to start a business and
get rich?  Do you think these banks are dying to throw their money
away ?


Now, finally I don't have anything against Iranian or Saudi or
Kuwaiti banks operating in and lending money in Turkey. All banks
who lend money are welcome.  If some people want to acquire partners
for the their business, they can have their way. If others prefer to
only borrow money, and manage their own businesses, they too can
have their way.  Any sane person would think many times over before
he/she decides to become partners with persons/banks unknown to them.
-- 

	mark	

   hubey@amiga.montclair.edu         hubey@apollo.montclair.edu
   hubey@pilot.njin.net               ...!rutgers!pilot!hubey    
Newsgroups: soc.culture.turkish,alt.fan.hasan-mutlu,alt.fan.serdar-argic,alt.angst.xibo.sex,alt.angst,soc.culture.soviet,alt.religion.kibo,alt.cascade