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Would Islamic finance have prevented the current global financial crisis Discuss - Essay Example

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Islamic financial institutions in the Gulf Corporate Council (GCC) states performed relatively well during the global economic crisis of 2008-2009.1 The successful performance of Islamic financial institutions in the GCC states is attributed to sustained growth…
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Would Islamic finance have prevented the current global financial crisis Discuss
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Download file to see previous pages The Islamic financial markets appears to have greater discipline and risk-sharing and conceivably can provide a solution or safeguard against the risk of financial crises.3 This research study analyzes the possibility that a world financial system modeled after Islamic financial systems may have prevented the current financial global crisis. It is concluded that some aspects of the Islamic financial markets system may have functioned to minimize the current global financial crisis, but it could not have prevented the crisis altogether. This is because some features of conventional financial systems are necessary for preserving and servicing conventional financial needs and competition, particularly the interests rates attributed to mortgages. This paper is therefore divided into four sections. The first section analyzes the causes of the financial crisis of 2008-2009. The second part of this paper analyzes the key aspects of Islamic financial markets regulations and ideologies. The second part of this paper also identifies and strengths and weaknesses of Islamic financial systems. The third part of this paper analyzes the feasibility of Islamic financial systems as a solution to or safeguard against financial crises. The final part of this paper offers concluding remarks and observations. Contents Abstract 2 Contents 3 Introduction 4 The Causes of the Global Financial Crisis 2008-2009 ...Download file to see next pagesRead More
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