Financial jihadists are fond of claiming that Shariah-compliance provides insulation from the effects of economic crisis. This is not true, but rarely do we see an admission on this point from anyone in the Islamic world. Today there is an article which admits that “Islamic finance” is not immune to the impact of economic and financial crisis. (Of course, the article also implies that this is all the fault of the outside world and has nothing to do with any of the practices of Shariah-Compliant Finance, but we’ll take what we can get…)

“To say that the Islamic banking industry will not be affected by this crisis is, in my point of view, a clear and glaring inaccuracy. The Islamic banking industry does not operate independently from international markets, and so it is not immune to international financial fluctuations.”


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