Fual crisis in the west

[showkot]

assalamo alaikum
over the last few days we have observed the efeects of high prices in oil especially in europe where the nations are about to come to a standstill and the people expressing their anger by protests,road blocks and strikes. however in the USA this is not the case and life continues normally and the USA witnessing the problems in europe taking a very relaxed approach towards them.however this is expected since the nature of the capitalist thinking is to look after your own interests only and not others.
however one question arises why cant the european nations the nations who think they have all the correct answers to problems not been able to resolve this problem of high prices. surely this must point to inadequacy in their system?
if we look at the capitalist economic system there are 3 reasons why the system allows for high prices to exist causing major difficulties for ordinary people.
firstly the economic system allows prices to be determined by 2 factors supply and demand. when the companies supply the oil and people who want to come to buy it come together this forms the market and the interaction of the two causes the price to be determined. from this any shift in the supply and demand can cause the price to chnage and in the case of the oil market the reason for prices to increase on the world market was due to excessive demand and shortage of supply causing the price to rise to compensate for shortage of oil. this means who ever can afford to pay the price can only have the oil where as those who cant have to suffer. an interesting point to note is that if a nation can influence the supply of oil in the market they effectively can control price around the world and it is well known that saudi arabia is under the influence of the USA and whenever a delegation sends a request to the saudi regime to increase the supply it happily accepts and we witnessed this a year ago when the oil was $10 a barrel when the US requested to cut supply and saudi arabia actioned this. so diretcly the USA control the pirce of oil around the world. however the cheaper the oil the better for buyers and worse for the sellers ie muslim countries and when there are shortfalls in revenue in muslim countries as will be the case now with oil prices lowering the muslims have to suffer by higher taxes and inflation domestically and this contributing to surviving with difficulty and compensating by having to work longer hours and even 2 jobs for the msulim ummah.
secondly the capitalist economic system makes price the cornerstone of their system. this means everything has a price and everything is evaluated through money including the spiritual and moral needs of people. the way the system views the human being is how much he has contributed to the economy and if he has not then he is a burden and a liability. also with the price system being the measure anyone who cant pay and meet the prices of products on the market effetcively has to lose out irrespective of he is human with organic needs which need satisfying. social security found in the west is not strictly part of the economic system but was introduced on political terms so we cant say that it is part of it and the fact that they have to have this separate and existing shows the weakness in the system in the first place since the whole point of the economic system is to provide a way to fulfill the needs of a human being which have to be satisfied and the fact that there is a economic system and separate social security shows inadequacy.
also another point is that the oil is sold for dollars making it stronger all the time since it is in continuous circulation and used whereas the euro is weak against the dollar adding to high prices because the western nations have to buy in dollars selling more of their own currency and then making the shortfall by setting higher prices.
also in european countries the tax system is very high compared to the USA about 80% which adds to hiher prices therefore causing overall high prices. with these qualities in the economic system its no surprise that the people were forced to stand up against the government which shows how the western way of life is not really compatible with human nature.
however in islam allah swt has sent the system which treats humans as humans and not stocks and shares who you can play around with and set certain laws to ensure that peoples needs are fulfilled.
firstly allah swt has madeit haram for any individual person or company(ies) to own the public resources such as oil since mohammed saw the people are partner in 3 things fire, water pasture land which means it is their for the use of the muslims and not for certain individuals.once the prophet saw allocated some land to an inividual but took it back after realsing it had certain resources that could be used for all people.
secondly the supply of oil is to be controlled by the state and no other country can influence this since allah has restricted to judge by what allah has revealed rather than the delegation sent by the white house.this means the price cant be tampered with.
thirdly the currency of the islamic state is to be gold and silver and not the dollar or euro forcing those nations who wish to purchase oil to acquire gold and making the gold the standard and devaluing the dollar and giving it less importance. this in turn will start developing the poorer countries who have abundance of gold and start to mine and sell it developing their economies and making it dependent on gold and those countries who demand it ie the khilafah and can be used as obstacles against the IMF and world bank since they would not need to rely on them anymore.Abu Dawud and An-Nasai narrated from Tawus who narrated from Ibn 'Abbas that he said: That the Messenger of Allah (saw) said: "The weight is the weight of the people of Makkah and the measure (mikyaal) is the measure of the people of Madinah". Makkah and Madina did not buy with the dollar but with gold, so that we can collect it as ready money/cash. Thus our resources will come to our treasury where we possess actually, protect practically and dispose of them according to our real interests rather than remain as numbers in Kafir banks, and not protected against the dangers of confiscation, freezing or nationalisation and without having the ability to dispose of them.

fourthly there is no tax system in islam that we find in the west which as a system is used to collect revenue specifically rather in islam we have obligatory zaket etc but no such thing as VAT DUTY CUSTOMS.
also the pillar of the econmomic system is not based on the pricing system alone rather when it comes to using money it has to be gold and silver but however viewing an economy based on human needs people can accept payment for doing a job by the trasbfer of goods instead of money which will fulfill their needs. so we can sell oil in exchnage for food or a company employee can accept a house and food in exchnage for wages or part of his wages which the capitalist system does not use at all.
so we can see how islam can deal with this issue in effective way and in such a way where the primary focus is not profit but the securing of peoples needs.

[BOY_4ROM_BENGAL]

Salaam Showkot.

The free market forces in the Capitalist society is the key to determine what to produce and for whom.

If we refer to the consumer surplus and the basic economic problem.You will find that these theories are embedded in the Capitalist thoughts.


Now, oil is perfectly inelastic.This is a problem for those countries that have not got oil.In addition, the problem increases if the products they manufacture require oil.(It affects exports as well as prices in the form of cost push inflation, then you get wage-price spirral).

Basicly, what I am trying to say is that after the two oil price shocks in the 1970s.The west have positioned their economy to stifle out these shocks.

In those days the western economy was affected by oil and inflation.This is refered to as the "old economy".

But the new economy is based on information and microchips. The creation of e-commerce has made the wealthy ppol not to be affected by the old economy instruments.

I want you to consider this, did the capitalists create such situation, i.e.fuel crisis, in order to benefit from substancial gains.

These economic problems are created to increase wealth.

Consider this. OPEC countries such as Saudi, Iran etc specialise in exporting oil.This is there main trade pattern.

According to Comparative Advantage and other international trade theories, they should import the goods they are scarce off.Howver this has failed to a certain extent.

Now, the oil producing countries are dependent on exports.If they have want to increase revenue, the only instruments available to them is fiscal policy in terms of increasing domestic taxation.Or they can increase the price of oil and reduce production.The former will worsen the domestic economy.

So by increasing price of oil, a process of arbritage now occurs.Now those countries that have no oil, there economy is in crisis.

Therefore....
Inflation will occur, thus interest rates will rise.Which means share prices will fall.

Now those with substancial wealth will invest since prices of equities have fallen.Then they make a substancial gain.

This is just one example.Increasing prices means increase in the profit margin.If you refer to the consumer surplus, this can be applied to any industry.Then refer to the basic economic problem.

Tell me if I am right or not.

[Wais_Islam]

hi can u pls send this in the open board so others can see it.

[Wais_Islam]

Boy, u have not mentioned the correlation between trees and oil for cremation purposes and the impact on international markets?