Studying Islamic Finance

السلام والازدهار العدالة المجتمعي
You are visiting a blog associated with an online noncredit course studying the topic of Islamic Finance, moderated by John Wiley Spiers. Feel free to participate in our discussion, and if you are interested in taking the course visit http://www.johnspiers.com/Islamic_Finance/Welcome.html

Thursday, August 1, 2013

Three Examples of Usury & Greed

1. There is this curious problem of victims arguing in favor of their abusers.  Students are now the primary target for usurers, now with student loan debt more than credit card debt.

The White House and its allies said the new loan structure would offer lower rates to 11 million borrowers right away and save the average undergraduate $1,500 in interest charges.
"Finally, we are taking action on the pressing issue of college affordability," said Rep. Jared Polis, D-Colo. "We have to make sure our students are able to plan their futures."

What future?  A college degree no longer improves chances of getting a job, and now 1/2 of college grads do not find work upon graduation.  But to the point: the reason school is expensive is due to usury.  The "free money" or "cheap money" floods into schools and they raise prices to sop up that "money."  This bill does not help, it only makes things worse.  But the victims demand it!

2. Enterprise rent-a-car has a great reputation.  I have long liked them as a provider.  I like SuperCheap Rentals out of San Francisco airport best, but they are closed on Sundays, which is good.    This was a rare Sunday for my arrival.  So I went to enterprise.  I now only use debit cards, and Enterprise accepts them.  Of course, they take a hold over the rental amount to secure their asset, fair enough.  But when I brought the car back, they informed me they actually charge the security fee on the card.  Now, it is only $200, but it comes off my debit card, out of my account and into theirs.  And then return trip.  Well!  I try not to keep a lot of money in my debit account, so this requires I move things around, or, by the Grace of God make it home short of funds.  While I was on the phone with the bank moving things around, the banking rep I talked to said, "O yeah, we get so many complaints about the Enterprise policy charging debit cards."

Why would they do this.  Think 5000 transaction a day, say, at $200 deposit, for 3 days to refund it.  that is a float, an interest free loan, of a million bucks to Enterprise, continuously.    The number is probably much higher.  But see how the greed for interest-free, the flip side of interest, is hurting an otherwise attractive provider.  I won't be back.

It does not matter, that I am striving to be usury-free, the others are striving to be usury-advantaged.  tough to steer clear of them.

3. And here is a curious eight minute video.  A father led his family into "bankruptcy" speculating in beanie baby toys.  The hear to business is serving others.  This business was pure speculation.  it is painful to hear the father rationalize the activity, for he still regrets it did not pay off.  And read the t-shirt he is wearing.  He blames the toy, and not himself, for the "bankruptcy."



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