Sunday, December 7, 2008

Malaysia usul semula penggunaan dinar emas

Malaysia usul semula penggunaan dinar emas

Oleh Zainab Mohd Yatim
Bhbiz@bharian.com.my

Kaedah perkukuh, pertingkat dagangan sesama anggota OIC

MALAYSIA akan mengusulkan semula cadangan penggunaan dinar emas dengan menjadikan pertemuan pemimpin dan pembuat keputusan dari kalangan negara Islam seperti mesyuarat Pertubuhan Persidangan Islam (OIC) sebagai platform.

Menteri Kewangan Kedua, Tan Sri Nor Mohamed Yakcop, berkata penggunaan kaedah pertukaran wang itu wajar dipertimbangkan semula memandangkan hubungan dagangan antara negara Islam yang semakin meningkat, selain mencari kaedah terbaik untuk menggantikan sistem Anglo Saxon yang semakin lemah dan tidak stabil akhir-akhir ini.

Memberikan contoh, beliau berkata nilai dagangan antara Malaysia dengan negara OIC yang membabitkan 57 negara, adalah 12 kali lebih banyak berbanding antara negara bukan anggota pertubuhan berkenaan.



"Dalam keadaan ekonomi global yang tidak menentu yang mana pasaran wang dalam keadaan begitu getir, sengit dan mencabar, mungkin elok negara Islam seperti OIC melihat kembali peranan dinar emas sebagai kaedah memperkukuhkan dan mempertingkatkan dagangan sesama negara anggota.

"Sebelum ini saranan kita tidak begitu diterima negara OIC, tapi mungkin dalam keadaan yang berubah dan mencabar yang menyaksikan sistem kapitalisme Anglo-Saxon tidak tahan dan nampak kelemahan yang begitu banyak, kita boleh lihat kembali penggunaan dinar emas," katanya.

Beliau berkata demikian pada sidang media selepas merasmikan Wisma Yayasan Ekonomi Sejagat (YES), di Bukit Persekutuan, kelmarin.


Malaysia sebelum ini pernah mencadangkan supaya dinar emas digunakan sebagai perantara perdagangan antarabangsa bagi mengelakkan tekanan tukaran asing dengan dolar Amerika Syarikat sebagai tanda aras tukaran asing utama.

Nor Mohamed juga menjelaskan, bilangan umat Islam seramai 1.8 bilion di seluruh dunia juga sewajarnya dimanfaatkan menerusi dagangan antara sesama Islam dengan menjadikan dinar emas sebagai tukaran.

Tambahan lagi, katanya sebahagian besar daripada produk yang diedarkan di pasaran negara Islam yang dibeli dari Barat sebenarnya datang dari negara Islam.

Mengenai krisis ekonomi global, beliau berkata Malaysia tidak akan menerima kesan yang teruk hingga menyebabkan kemelesetan tahun depan, memandangkan kerajaan sudah mengambil langkah rangsangan yang mampu mengurangkan tekanan berkenaan.

Namun beliau tidak menolak, kemungkinan negara akan berdepan tempoh agak mencabar sekurang-kurangnya antara 18 bulan hingga dua tahun akan datang akibat daripada perkembangan berkenaan.

"Mengikut perkiraan, tiada kemungkinan negara akan terjerumus ke dalam kemelesetan pada 2009. Perkiraan kita berasaskan senario ekonomi sebenar dan juga berasaskan apa yang akan kita laksanakan.

"Kita mahu memastikan kebanyakan langkah berkenaan dilaksanakan menjelang suku tahun pertama," katanya.

Beliau yakin, seperti beberapa krisis yang dialami sebelum ini, negara bukan saja dapat meneruskan kelangsungan hidup, malah mampu bangkit menjadi sebuah negara yang lebih maju.

Mengenai inisiatif pembiayaan swasta (PFI), beliau menjelaskan, selagi sesuatu projek itu berdaya maju, kerajaan akan pastikan ia dilaksanakan dengan segera.

Wednesday, November 12, 2008

Precious metal a safe haven in times of market fluctuations

Saturday November 8, 2008
A gold rush?
By YVONNE TAN


Precious metal a safe haven in times of market fluctuations

GOLD has resurfaced to claim its title as a “safe haven” for investors. Its strongest advocates say it is the best hedge against inflation as stock markets decline.

Still, given the extreme volatility across financial markets, experts are finding it difficult to predict when would be the right time to swoop in on some gold.

However, most agree that if you take a long-term view, now may just be the right time to do so. “When the dust has settled, the fundamentals of gold will once again shine through,” says a dealer.

Gold prices gained over 6% this week to hit a session high of US$768 per oz. It is lower than its two-month high of US$931 per oz hit in October but significantly higher than the 13-month low of $680.80 per oz also achieved in October - a clearly wild month for commodity prices.

In any investment, the ultimate aim is to maximise returns while keeping risks low.

“The value of gold is relatively stable and it is often a safe haven when there is uncertainty and turbulence in the currency or stock markets,” says Malayan Banking Bhd (Maybank), senior executive vice-president, head of consumer banking Lim Hong Tat.

It has, in the current credit crunch remained less volatile against most commodities and precious metals, based on data by the World Gold Council.

In the third quarter , silver, platinum and oil 22-day price volatilities had spiked to 82%, 75% and 63% respectively compared with 39% for gold, the international body said.

In normal economic conditions, gold’s best contribution to an investor’s portfolio is the fact that its price enjoys a relatively low-to-negative correlation with other asset classes like currencies, bonds and Treasury bills.


JP Morgan has raised its price forecast for gold for 2008 and 2009 on expectations investors will buy

World Gold Council head of investment, North America Natalie Dempster said that gold was “unique”, in that it was an asset that bore no credit risk, involved no counter party and was no one else’s liability.

“These are extremely attractive characteristics to investors given the current financial environment,” she said.

Gold is an asset which does not depend upon any government’s or company’s promise to repay. It is not directly affected by the economic policies of any government and cannot be “frozen” as in the case of paper-based assets.

It also is one of the most liquid of global assets as it is readily sold 24 hours a day in multi markets.

Although the price of this precious commodity has not been totally spared from the current financial tsunami, as one investor so aptly put it, “gold is gold”.

“Its price does fluctuate but many investors find it to be more stable compared to other forms of investments,” says Maybank’s Lim.


For investors who like to keep their strategy simple, they can opt to buy traditional jewellery such as chains and bracelets.

Short-term impact on the price of gold, the World Gold Council said, included a rise in the US dollar which has historically weakened investors’ demand for gold as an alternative investment, deleveraging of commodity positions, and sales (of gold) in order to meet margin calls on other assets.

“On the one hand, potential weakening emerging market growth, a rising US dollar and falling inflationary concerns all offer serious headwinds for near-term precious metals prices,’’ Hussein Allidina, an analyst at New York-based Morgan Stanley said in a report quoted by Bloomberg.

“On the other hand, the physical side remains remarkably strong with exchange-traded fund demand remaining resilient globally and bar and coin availability limited while central banks selling has almost evaporated and gold lease rates remain high,’’ she said.

JP Morgan, meanwhile, has raised its price forecast for gold for 2008 and 2009 on expectations investors will buy into bullion as a haven from risk.

It forecasts gold prices at US$904 an ounce in 2008, against a previous forecast of US$884, and at US$875 an ounce next year, up from US$854 previously.

According to Maybank’s Lim, gold investments in Malaysia can be made via the purchase of physical gold bullion in the form of gold coins or by opening a gold savings passbook account which allows account holders to invest without worrying about physical storage.

“The most popular coin is the Kijang Emas that is produced by Bank Negara. In a variety of sizes, their gold content, that is the weight and purity is guaranteed by the Government,” he says.

The purchase and resale price of Kijang Emas is determined by the prevailing international gold market price with daily market prices posted on the central bank’s website.

Via the Maybank Gold Savings Passbook Account, investors are provided with a passbook which will record all their gold trading transactions.

The passbook is also used for deposit and withdrawal purposes.

The purchase of gold here is based on the bank’s prevailing gold selling price while the withdrawal of gold will be converted into ringgit at the prevailing price of the commodity.

Account holders can withdraw their gold in cash or physical gold form.

Similarly, in April this year, Public Bank Bhd launched its Gold Investment Account that allows individual customers to purchase the commodity in 99.99% fineness at daily prices in ringgit per gram.

Alternatively, investors can make their gold investments via gold exchange-traded funds (ETFs) listed overseas.

Asia’s first gold ETF which trades like any other stock, StreetTRACKS Gold Shares was cross-listed on the Singapore Stock Exchange in 2006. It was originally listed on the New York Stock Exchange in November 2004.

The gold shares are backed by physical allocated gold bullion and are traded in US dollars.

Local investors need to open an account with foreign brokerages or certain local brokerages which facilitate overseas trading in order to trade gold ETFs.

Meanwhile, for investors who like to keep their strategy simple, they can opt to buy traditional jewellery such as chains and bracelets.

According to Tomei Consolidated Bhd group managing director Ng Yih Pyng this trend has been especially pronounced over the past year: “This is partly because gold price had been on an uptrend during this period and also because stock investments had become more risky.”

Investors either buy jewellery or pure gold bars for their investments, Ng adds.

”Gold is an option that Malaysian investors can choose as they become more savvy with the understanding of gold investment via education programmes and as access to investment becomes more convenient,” Lim says.

In this regard, the bank is planning to increase awareness on gold investments, he adds.


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France calls for financial warning systems

Wednesday November 12, 2008
France calls for financial warning systems


MEXICO CITY (AP) - The world should develop an early-warning system that would alert countries to looming financial threats, France's finance minister said Tuesday after meeting with her Mexican counterpart.

The proposal was among the ideas French Finance Minister Christine Lagarde discussed with Mexican Finance Secretary Agustin Carstens ahead of a summit in Washington on Saturday for leaders from rich and developing nation on the international financial crisis.

She gave no details on how the system would work.

In a joint news conference, Lagarde and Carstens said they agree there should be a globally coordinated response to the financial meltdown that would include stricter government regulation, more supervision of markets, greater transparency, and stimulus packages like that recently adopted by China.

China announced on Monday that it will boost its economy with a near $600 billion package by the end of 2010.

Carstens said the International Monetary Fund needs to be strengthened. He also recommended expanding the Financial Stability Forum, founded in 1999 by the Group of Seven leading industrialized countries with the aim of bolstering the international financial system.

"We fully agree that it's essential that protectionism be avoided and market dynamics be preserved,'' Carstens said.

Lagarde, who arrived to Mexico from meetings in Brazil, said the two Latin American countries should be among the countries invited to join the powerful G-7, which has a large say in global economic policy.

Mexico has been hit hard by the economic downturn, with Fitch Ratings on Monday lowering its sovereign credit rating outlook to "negative'' from "stable.''

A negative outlook means there is a greater chance of the actual credit rating being downgraded.

"Agustin and I hope that the heads of state give us strong indications that support sustainable and shared growth,'' Lagarde said, adding that she expects leaders to make concrete proposals and agree to a timetable to tackle the biggest financial crisis since the Great Depression.

Many G-20 officials have concluded that major bailout packages in the U.S., Europe and elsewhere have so far failed to re-establish the credit lines and confidence needed to ease the crisis, making additional measures necessary.

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UN chief: Financial summit must focus on poor

Wednesday November 12, 2008
UN chief: Financial summit must focus on poor


UNITED NATIONS (AP) - Secretary-General Ban Ki-moon on Tuesday urged world leaders attending this weekend's financial summit in Washington to do everything they can to alleviate the impact of the current crisis on the world's poorest people.

Ban, who will be attending the summit, said he will also tell the leaders that the billions of dollars being spent to mitigate the financial crisis are already "vastly more'' than the amounts they allocate to international aid.

So "this is clearly a question of will,'' the secretary-general said.

U.S. President George W. Bush has invited leaders of the world's 20 largest industrialized nations and emerging economies to meet Saturday to tackle the financial crisis that has sent economic growth plummeting in many countries and raised fears of a long-term global recession.

"First, we must do everything we can to alleviate the impact of the crisis on the world's poorest and most vulnerable people,'' Ban told reporters at U.N. headquarters.

The secretary-general said this is more important now than reforming international institutions such as the World Bank and International Monetary Fund which will take time.

"I would welcome any measures and initiatives to address this global financial crisis, including the reinvention and reform of the basic structures of financial institutions,'' Ban said.

"But I am more interested, and my focus will be more on how to insulate the interest and well-being of developing countries from the financial crisis impact.''

The secretary-general said the crisis is also an opportunity to address climate change.

"At a time of growing economic hardship, green growth can create millions of jobs,'' he said.

Ban said he also wants the summit to focus on the food crisis and achieving U.N. development goals by 2015, including cutting in half the number of people living in extreme poverty and ensuring that every child has a primary school education.

"This is just a beginning,'' the secretary-general said of Saturday's summit.

"I think this will have to be followed by many subsequent meetings and consultations.''

Ban said he will be making the same appeals at a U.N. development summit in Doha, Qatar, from Nov. 29-Dec. 2.

The U.N. International Conference on Financing for Development will assess progress on the international agreement reached in Monterrey, Mexico in 2002 to alleviate poverty and fuel development.

The U.N. said Tuesday the Doha meeting will focus on trade, aid, investment, debt alleviation, mobilizing national resources and "effective international architecture.''

It will also steer the Monterrey agenda to challenges that have taken on a higher profile since 2002 including climate change, food and agriculture.

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Financial crisis a chance for Islamic banking to shine

Wednesday November 12, 2008
PM: Financial crisis a chance for Islamic banking to shine


KUALA LUMPUR: The global financial meltdown stemming from the US subprime woes actually poses an opportunity for the Islamic finance system to demonstrate its uniqueness, said Prime Minister Datuk Seri Abdullah Ahmad Badawi.

He said that, following the crisis, observers were considering the Islamic system with envy and respect as it prohibited speculative excesses.

He said the financial meltdown showed the desperate need for a system like Islamic finance, which is based on the principle of profit-sharing where both parties are subjected to potential losses and returns.

“Thus, it is fair and equitable. Islamic banks do not buy or trade debt; rather they manage concrete assets which are tied to real economic activities,” he said, adding that prohibitions against high levels of debts, unsecured debt and speculation result in high financial prudence.

“These ethical and moral safeguards are missing in the conventional system,” Abdullah pointed out.

He said the financial crisis had its origin in the innovation of buying subprime mortgage loans, where pools of subprime loans were repackaged, and then sold as tradable securities.

“Very soon, financiers were actively trading bundles of subprime loans, most of which had risk profiles that no one truly understood.

“In reality, these repackaged subprime loans were nothing more than artful works of deception that fed the speculative excesses and hubris in the financial markets,” he said in his speech which was read out by Minister in the Prime Minister’s Department Datuk Seri Ahmad Zahid Hamidi at the launch of the International Shari’ah Research Academy (Isra).

Abdullah said that in making itself a competitive industry the Islamic finance sector must continue to clarify and resolve issues.

The issues includes the different interpretation of the syariah which had led to some Islamic banking and finance products being accepted in one Muslim country but deemed dubious in another.

Chance for Islamic Finance to lead: PM

Published: Wednesday November 12, 2008 MYT 1:25:00 PM
Updated: Wednesday November 12, 2008 MYT 3:35:03 PM
Chance for Islamic Finance to lead: PM
By NG CHENG YEE


KUALA LUMPUR: There are tremendous opportunities for Islamic Finance to lead the financial fraternity into a new growth era, said Prime Minister Datuk Seri Abdullah Ahmad Badawi.

He said Islamic Finance needs to quickly integrate itself with the international financial system and prove itself as a viable alternative to the conventional financial system practised in most parts of the world.

“Many observers are increasingly considering the Islamic Financial system with renewed respect and admiration.

“As such, Islamic Finance must be prepared to take on a new dimension to meet the changing demands of business in an increasingly globalised environment,” he said Wednesday at the launch of Standard Chartered Saadiq Berhad here.

Abdullah said Malaysia is well poised to lead any attempt to reform the global financial system by infusing concepts and themes borrowed from Islamic Finance.

He said the recent global financial meltdown illustrated the desperate need for a system based on the principle of profit-sharing, where both parties in the contract are subjected to potential losses and returns.

“It is a system that is both fair and equitable as both parties are presented with a win-win situation such that losses would not burden only one party,” he said.

He said by transforming into an essential element of global finance, Islamic Finance would surely end its perceived position as a niche or boutique financial service.

However, he said, for Islamic Finance to be an effective complement to global finance, it is imperative to have a sound legal framework, which would provide the sector with the credibility it requires.

Tuesday, October 28, 2008

Chinese chamber of commerce promotes Halal seminar

To promote the involvement of Malaysian companies in the halal industry, the chinese chamber of commerce and industry KL,Selangor and Klang organise a seminar on Development Prospects of Halal Industry in Malaysia and Islamic Banking Facilities on Nov.8 2008 at Seng Peng Hall from 9.30am to 1.30.

80 million muslims in China alone,Halal products a hit at China expo

Halal products a hit at China expo
By Chan Cheng Tuan Published: 2008/10/24


NANNING: Malaysia's halal products have received positive response from potential buyers at the 5th China-Asean Expo (CAEXPO) which was launched here on Wednesday. Malaysia External Trade Development Corporation deputy chief executive officer (promotion) Dr Wong Lai Sum said there had been many queries from potential buyers including the Walmart chain and French companies.

"It is not only for Walmart's China market but for the Asia-Pacific region," she told reporters at the expo.

Wong said CAEXPO was a good platform for Malaysia to explain and promote its halal products, adding that there was a big global market for such products.

Malaysia's export of halal products is valued at US$3.32 billion (RM11.85 billion) a year. Wong said this was only a drop in the ocean as the global trade in halal products amounted to US$2.1 trillion (RM7.5 trillion)



Of the nearly 100 Malaysian companies at CAEXPO, 27 are dealing with halal products comprising consumables such as confectionery and non-consumables including cosmetics.

Wong said Malaysia wanted to show that the country's halal standard was not only about adherence to religious requirements but was also based on strict hygienic practices.

"We want to show that halal products are not only for Muslims but they are for everybody as they are safe from the source to the delivery," she said.

Wong said Chinese and Malaysian firms could have joint ventures and collaborate in terms of the halal certification. For instance, China could export its product with Malaysian halal certification.

There is a huge market in China for halal products as more than 80 million of its 1.3 billion population are Muslims.

Wong said apart from the halal products, there had also been encouraging response to the Multimedia Super Corridor.

Malaysia is promoting Cyberjaya and the MSC at the expo. Among others, companies are told of the benefits of being accorded MSC status.

"There have been many queries and the Chinese are impressed with what we have achieved so far," said Wong.

She said the Chinese were interested to enter Malaysian market as it was a way for them to penetrate the Asean and West Asian markets.

Wong also expressed satisfaction with the response to the Malaysian pavilion so far. Since the launch of the expo on Wednesday, about 1,000 people had visited the various booths at the pavilion daily.

CAEXPO is co-sponsored by the Ministry of Commerce of China and its Asean counterparts as well as the Asean Secretariat, and organised by the government of Guangxi Zhuang Autonomous Region of China.

Held annually in Nanning, it is aimed at spurring the setting up of the China-Asean Free Trade Area and serving as a platform for China and Asean to enhance their bilateral economic and trading cooperation.

Sunday, October 19, 2008

Malaysia slams global 'casino' principles

Malaysia slams global 'casino' principles
By Adie Suri Zulkefli Published: 2008/10/20

THE world financial system, which operates on the "casino" principles, must be changed to ensure stability in the international economy, thus allowing developing nations to implement their development programmes.

Second Finance Minister Tan Sri Nor Mohamed Yakcop said the casino principles have proven to only benefit a small circle of investors, while creating a huge damage to the affected nations.

Citing the 1997 Asian financial crisis, he said currency speculators made several billions of profit from the crisis, but the damage they created in the region was worth hundreds of billions.

Nor Mohamed said the current crisis in the US is motivated by greed and fear.



"The US economy makes so much profit from complex structured financial products created by their banks," he said in Tasek Gelugor, Penang, yesterday. "These products have no genuine value. However, due to greed, they invested heavily without knowing what they are paying for," he added.

He added that when things started to go wrong, the US realised that the wealth was just a worthless paper and their greed shifted into extreme fear.

Nor Mohamed said investors then started panic-selling and refused to invest even in those shares and projects that have genuine prospects and values.

"At this point, they are no longer rationale as they are motivated by fear and the economy begins to slip into recession," he said.

'Islamic finance to play bigger role in global stage'

'Islamic finance to play bigger role in global stage'
Published: 2008/10/20

ISLAMIC finance is growing at an average of 15 per cent annually and gaining acceptance from the broader population in many countries, according to Institut Bank-Bank Malaysia chief executive officer Dr Mohd Kamal Khir.

"The total Islamic financial assets now exceed US$1 trillion (RM3.5 trillion), about fivefold its magnitude five years ago," Mohd Kamal said in conjunction with the Sixth International Islamic Finance Conference which opened in Kuala Lumpur last week.

According to him, the adoption of mainstream financial instruments by the Islamic finance community will see the sector playing a bigger role in global finance over the next decade.

"Such a development will not only further support the acceptance of Islamic finance, but also offer vast business opportunities made possible by the huge amount of Islamic funding available," he said.



"Players are quickly expanding their range of offerings by adopting some of the financial instruments available in the mainstream financial markets," said Monash University's Sunway campus chair of accounting and finance, Professor Bala Shanmugam.

He also said that the conference has emerged as an important international platform for the sharing of knowledge in Islamic finance. - Bernama

Islamic banking escapes fallout of global financial crunch

Agence France-Presse - 10/20/2008 1:18 AM GMT
Islamic banking escapes fallout of global financial crunch
Islamic banking has largely escaped the fallout from the global financial crisis, thanks to rules that forbid the sort of risky business that is felling mainstream institutions.

But experts say that because of its heavy reliance on property investments and private equity, the booming 1.0 trillion dollar global industry could be hit if the turmoil worsens and real assets start to crumble.

"In the current financial turmoil, it is interesting to note that Islamic financing may have prevented a majority of the mess created by the conventional banking and financial institutions," Kuwait Finance House said in a report.

"The outlook for Islamic financing is bright and will likely take the lead in terms of providing funding for major projects as the conventional banking system reevaluates its business model."

The rules of Islamic banking and finance -- which incorporate principles of sharia or Islamic law -- read like a how-to guide on avoiding the kind of disaster that is currently gripping world markets.

Islamic law prohibits the payment and collection of interest, which is seen as a form of gambling, so highly complex instruments such as derivatives and other creative accounting practices are banned.

Transactions must be backed by real assets -- not shady repackaged subprime mortgages -- and because risk is shared between the bank and the depositor there is an incentive for the institutions to ensure the deal is sound.

Investors have a right to know how their funds are being used, and the sector is overseen by dedicated supervisory boards as well as the usual national regulatory authorities.

"Islamic banking has, thus far, remained positive, despite the current challenging global financial environment," said Zeti Akhtar Aziz, the central bank governor of Malaysia, which is Southeast Asia's leader in Islamic banking.

Zeti said this month that because of the slowing global economy, plans for Islamic "sukuk" bonds had been postponed or scrapped by companies including Kuwait's Abyaar Real Estate Development Co. and Malaysia's Perisai Petroleum.

And Jennifer Chang, a partner at Pricewaterhouse Coopers in the Malaysian capital Kuala Lumpur, said that given the extent of the global crisis, Islamic banks may suffer damage despite their strong position.

"Islamic banks, especially in the Middle East, got heavily into private equity and real estate investments, and a lot of loans may be backed by properties. So if the property market goes down, there will be an impact," she said.

"If a borrower is not able to pay then the bank will foreclose and the question is -- can you sell the property in the market and at what value? These are issues which all banks can face."

There have been calls for the conventional banking industry to take a leaf out of the book of Islamic finance, which also shuns investments in gaming, alcohol and pornography in favour of ethical investments.

Influential Sunni cleric Sheikh Yusuf al-Qaradawi earlier this month called on Muslims to take advantage of the turmoil to build an economic system compatible with Islamic principles.

"The collapse of the capitalist system based on usury and paper and not on goods traded on the market is proof that it is in crisis and shows that Islamic economic philosophy is holding up," said the Egyptian-born, Qatar-based cleric.

In recent years the sector has broken out of its niche and been embraced by mainstream banks. As well as basic bank deposits and investment accounts, it has expanded into areas including equity funds, bonds and Islamic hedge funds.

Abhishek Kumar, a senior research analyst at Financial Insights, a company under market research and analysis firm International Data Corp (IDC), said recent events may further boost the sector.

"More and more institutions will be interested in providing Islamic services to diversify their risk portfolio," he said, while warning that in the current financial storm there were no absolutely safe harbours.

"We're not really sure what the real extent of the impact is, and whether we've passed the worst of it or not, But the extent is not going to be as bad as in the mainstream sector," he said.

US, European leaders to hold summits on financial crisis

US, European leaders to hold summits on financial crisis

--------------------------------------------------------------------------------
19th Oct 2008

US and European leaders have agreed to hold a series of summits to reform the global financial system to make it more resilient and ensure continued prosperity in the world.
US President George W. Bush, French President Nicolas Sarkozy and European Commission President Jose Manuel Barroso said in a joint statement released after their talks that the first summit would be held in the United States "soon after the US elections" on November 4.
The world leaders will "review progress being made to address the current crisis and to seek agreement on principles of reform needed to avoid a repetition and assure global prosperity in the future," it added.
Later summits "would be designed to implement agreement on specific steps to be taken to meet those principles," the statement read.

The first of the summits will likely be held in November, but Tony Fratto, a White House spokesman, did not give a date.

According to the joint statement, the three leaders "had a very positive discussion" about continuing to coordinate steps needed to solve the financial crisis.

Sarkozy and Barroso arrived Saturday for a three hour meeting with Bush at the presidential retreat at Camp David in Maryland, outside the US capital.

Just before the meeting, UN Secretary General Ban Ki-moon said he backed the idea of a summit by early December at the latest.

Sarkozy, whose country currently holds the rotating presidency of the European Union, is seeking a bold relaunching of the international financial system. The French president warned that it was urgent to stabilize the marketplace "as swiftly as possible by coming up with answers."

"Once calm has been restored, we must avoid at all costs that those who have led us to where we are today should be allowed to do so once again," he said at Camp David.

Bush , meanwhile, stressed the importance of preserving "the foundations of democratic capitalism -- the commitment to free markets, free enterprise and free trade."

Fallout from the crisis grew as fresh job losses were blamed on the turmoil. Bank chiefs faced a backlash, and stocks Friday closed a tumultuous week with more wild swings.

Key US data showed starts on building new homes slumped an additional 6.3 percent in September to the lowest level since the 1991 recession, the latest evidence of the burst housing bubble that shook the US economy and triggered the global financial crisis.

Unemployment has risen across Europe and the United States, with key sectors such as car makers badly hit. Analysts forecast worsening economic conditions in most advanced economies.

Fratto said that a location for the first summit had not been determined, though Sarkozy recommended New York, where the crisis began.

Fratto said that Bush, Sarkozy and Barroso proposed a series of summits because it was "too ambitions" to think that the crisis could be solved in one single meeting.

The European leaders are seeking to overhaul the Bretton Woods system that has governed international finance since the end of World War II, and launch a new system.

"You have a lot of people talking about Bretton Woods," said Fratto. "Bretton Woods was a three week conference that involved 44 countries at a time when there were a lot fewer countries in the world," he said.

The first summit would be "to discuss the current financial crisis and also to set forth principles that would guide the future follow on," he said.

Of course by then participants "would be interested in the views and the input of whoever the president-elect is," he added.

'Overhaul world financial system'

2008/10/19

'Overhaul world financial system'
By : Adie Suri Zulkefli

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Tan Sri Nor Mohamed Yakcop serving ‘air batu campur’ to young guests at his Hari Raya Aidilfitri open house in Teluk Air Tawar yesterday.


BUTTERWORTH: Ten years ago, Malaysia called for reforms in the global financial system but this was rejected by the international community.

Today, as fears of a worldwide recession mounts, European leaders are talking about changing the system.

Second Finance Minister Tan Sri Nor Mohamed Yakcop said, even though Malaysia had managed its economy well, the country would not be spared from the impact of the global financial crisis.

"We have built strong economic fundamentals but we can't say we are immune to the impact of the global crisis in the long run," said Nor Mohamed, who is also member of parliament for Tasek Gelugor, at his Hari Raya Aidilfitri open house in Taman Air Tawar Indah, Teluk Air Tawar.

He said Malaysia would continue to call for reforms in the global financial system.

He said it was time for the developed and developing nations to work together.

"We need to cooperate to formulate a new global financial infrastructure that is just and transparent, and do away with double standards and hypocrisy."



Nor Mohamed said the new framework should protect nations that managed their economies wisely from the impact of global crises.

He said the world reserves used by the United States to keep its economy going included the reserves of Asian countries and oil producing nations. He said the bulk of the reserves which were used to buy treasury notes, bills and bonds issued by western nations had been depleted by the crisis.

"We are proposing that these reserves be invested in developing infrastructure in Asean nations so that the region can reap the benefit by growing our economies together."

Nor Mohamed said Asean needed about US$50 billion (RM176 billion) for infrastructure development annually.

Malaysia will be hosting a financial infrastructure seminar on Nov 10 for leaders from the region to discuss the issue.

Sunday, October 5, 2008

Safety net for bank depositors

2008/10/05

Safety net for bank depositors
By : TAN CHOE CHOE

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Malaysia Deposit Insurance Corporation chief executive Jean Pierre Sabourin


With news about banks failing in other parts of the world, should we worry about our money in the bank? Malaysia Deposit Insurance Corporation chief executive Jean Pierre Sabourin tells TAN CHOE CHOE that our deposits are quite safe and our accounts are insured by the government — at least up to RM60,000 each

Q: French President Nicolas Sarkozy recently said millions of people around the world are worried about their savings. Is it the same here?
A: No. But this is an issue that's being addressed around the world every day.

We've seen, in the last couple of weeks, the concerns about AIG, bank failures in the United States and the bank run in Hong Kong... Depositors want to know "how do I protect my money?"


As to concerns about Malaysian banks, the question is not whether they are going to fail because our banks are very robust, very profitable.


They're insulated from events in the US because local banks are not involved in the US markets.


But the public should be aware of what's going on, especially if they follow CNN or other media and see the concerns of depositors around the world.


Q: So is the public making more calls expressing concern over the global economic situation?
A: Our approach to deposit insurance is to inform the public. The public must understand the kind of protection they enjoy so that they are confident about the banking system.


We did more advertising last month, so there have definitely been more calls.


While most were about how deposit insurance works and its features, we had a few callers asking if local banks were in trouble, with bank failures around the world.

We'd like to think that one of the reasons we are not seeing panic here is because the public has a lot of confidence in our banks, in Bank Negara and the Malaysia Deposit Insurance Corporation (PIDM). We are, as a financial system, managing our affairs appropriately.


In the last three years, we've been building our system and practices and approaches so that in case there is a problem in any of our member banks, we can go in quickly and fix it. We don't wait until banks fail.


We work very closely with Bank Negara to ensure our depositors are protected.


We try to meet our statutory responsibility, which is to inform the public of the protection afforded them.


Q: What is deposit insurance and how does it benefit me?
A: The deposit insurance system was introduced in September 2005. It's an initiative of the Financial Sector Master Plan to enhance depositor protection in Malaysia.


It is a form of protection or guarantee for money placed in member institutions, usually banks and financial institutions.


Membership in the deposit insurance system is mandatory under the PIDM Act 2005 for all commercial and Islamic banks, both domestic and foreign.


In the unlikely event of a bank failure, depositors will be promptly reimbursed up to the coverage limit of RM60,000.


Q: Why does it cover up to RM60,000 only?
A: Don't only look at the RM60,000. Look at the total coverage.


You're getting RM60,000 per depositor, per member institution. There are 36 banks -- 22 conventional and 14 Islamic.


You can put RM60,000 in each of the 36 banks. You can also have a joint account with your family members or friends and that's insured separately.


That means you can also put RM60,000 in joint accounts in 36 different banks. Or if you set up a trust account, you can do so in each of the 36 banks. In addition, Islamic deposits are insured separately.


If you're a small business, not incorporated, you get RM60,000 coverage. If you are an incorporated company, you get another RM60,000.


When Bank Negara did a study in 2004 and 2005, it found RM60,000 covers more than 90 per cent of the accounts but only 32 per cent of the value.


So the ones not fully covered are large accounts belonging to big corporations and businesses, and those with more money.


But that's a small number because not everybody's rich. It's really corporations and businesses that hold a lot of money in the banking system.


And when we're looking at deposit protection, we look at the issue of what is called moral hazard.


In a nutshell, we're trying to balance between having large depositors to provide market discipline and protecting the small unsophisticated depositors.


The big players don't care about the RM60,000 limit when they've got hundreds of millions of ringgit. So they monitor the performance of the banks because they've got more at stake.


We shouldn't expect the average depositor to do that because few people really understand complex financial services.


At PIDM, we act as proxy for all the small depositors and monitor the banks.


Q: What authority is vested with PIDM?
A: The PIDM Act 2005 spells out our mandate, which is to administer a deposit insurance system efficiently and effectively, promote confidence in the financial system and to promote sound risk management in our financial institutions.


For example, we have put in place this year, a new differential premium systems whereby banks having higher risk profiles pay higher premiums.


This gives banks financial incentives to fix any problems that they may have -- so the onus is on our member banks to act quickly to save money.


Q: So should I worry about the safety of my accounts now?
A: It depends. I want to emphasise that I am not saying you should have all your money in bank deposits.


It depends on your risk appetite. You may park some money in savings accounts, some in real estate, some in stocks. You have to look at spreading your risks.


But if protecting your bank deposits is your major concern, you should find out how it works and how to protect your money.


Q: My spouse and I have a joint-chequing account and individual savings accounts at the same bank. How are we covered?
A: In the same member bank, you and your spouse are individually protected up to RM60,000 on each of your individual savings accounts.


In addition, both of you enjoy separate protection of up to RM60,000 for the joint account. Therefore, the total deposit insurance protection in this instance is RM180,000.


Q: What if I hold an Islamic banking account?
A: Eligible Islamic deposits placed in Islamic banks are also protected by PIDM.


Furthermore, a depositor holding both conventional and Islamic deposits within the same member bank or group will enjoy separate coverage of up to RM60,000 on the conventional and Islamic deposits respectively.


Q: What happens to my deposit if two member banks merge?
A: You will continue to enjoy separate insurance coverage for a period of two years for each of your deposit accounts after the date of the merger, or upon maturity of the deposit (if it's a term deposit) or until you withdraw the deposit, whichever is earlier.


What we would do is to make sure you are informed that there is a merger and what happens to your deposit insurance coverage.


Q: Do joint accounts and trust accounts enjoy separate deposit insurance coverage?
A: Yes. Joint accounts enjoy separate deposit insurance protection limit, provided the records of the member bank disclose the names of the joint account holders.


Trust accounts also enjoy separate deposit insurance protection limit, provided the information on trust account beneficiaries and their respective interests in the deposit is disclosed on the records of the member bank.


Q: How can I maximise protection for my deposits in a single bank?
A: Each account is protected up to the RM60,000 limit.


For example, John holds an individual account; has a joint account with his wife; has a joint account with his daughter and wife; has another under the name of his legal firm; and another under his trading company.


Each of these accounts is covered up to the RM60,000 maximum. So John, with his five accounts, would be covered up to RM300,000.


Q: Can I buy additional insurance for my deposits if it's more than RM60,000?
A: No.


Q: How do I make a deposit insurance claim?
A: In the unlikely event of a member bank failure, PIDM will announce when (within three months) and how you will be reimbursed.


Q: If I walk into a bank now and open an account, how will I know if the product is insured by PIDM or not?
A: We're coming up with a new information regulation. It'll be in place by year-end.


We've been working with the banks for a year now, going through their products, deposits and documentation to determine which product is insurable and which isn't.


So when a depositor opens an account, the bank has to give him a brochure informing him whether the product qualifies for a deposit insurance.


If the bank is selling you a unit trust, they have to tell you it's not insured.


Q: Do I have to fill up any form to get back my money when a bank fails?
A: No. We'll do it all for you.


But we are proactive and do not wait until a bank fails to act. Our job is to move in quickly and fix any problems before a bank fails.


Q: Do you take over the bank?
A: When a bank is showing signs of problems, Bank Negara will inform us and we'll send in our team to check the extent of the problems. We'll look at the options available to resolve the problems and calculate the costs.


We can ask shareholders to put in more capital, sell off the bank's assets, or look for a willing buyer.


If there isn't, we may need to liquidate the bank.


Our board of directors, which includes the governor of Bank Negara and the secretary-general of the Ministry of Finance, will look at the least-cost option.


If we look at (American bank) Wachovia, their depositors today are now depositors of Citibank -- and that happened overnight.


That's one of the methods we could use -- take over the bank and sell it to somebody else.


Q: How much premium has PIDM collected so far?
A: About RM300 million. On average, we collect about RM100 million a year. That's less than one per cent of the annual profits of the banks.


It's minimal. The reason for that is because we don't have any expectations of failures.


Q: How does PIDM monitor its members to ensure they are practising prudent financial management?
A: We get the supervisory reports from Bank Negara and we will assess all the risks.


We have a risk-assessment model which we implemented this year.


Drawing on the supervisory reports, we will do tracking, trend-analysis and look at the key ratios.


If there's any problem, we'll discus it with Bank Negara and they'll meet with the banks or we'll meet with the banks directly to check the problem

Al Rajhi event offers convenience, fast processing

Al Rajhi event offers convenience, fast processing
Published: 2008/03/28

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AL RAJHI Bank's Weekend Banking Extravaganza starting tomorrow, held for the second year, is expected to be a hit among customers for its convenience and fast processing.

During the event, customers can apply for loan packages like Home Financing-i and Personal Financing-i and open accounts like Current Account-i, Savings Account-i or Mudarabah Savings-i.

Savings account and current account customers can also receive their respective ATM Visa Debit Card-i and cheque books in less than half an hour.

Customers will also get to participate in "The 60 Minutes Challenge" promotion, which entitles them to receive a RM100 shopping voucher if Al Rajhi Bank cannot process their application successfully within 60 minutes. Customers will be notified via SMS.



"The response to our inaugural Weekend Banking Extravaganza held last year was way above expectation.

"We're very pleased as this indicates that the banking weekend has huge potential and generates very good returns," chief executive officer Ahmad Rehman said in a statement.

He said based on the positive feedback, the bank plans to make Weekend Banking Extravaganza part of its culture.

"For this second Weekend Banking Extravaganza, I invite everyone to visit any of our 18 branches, except at Wisma Selangor Dredging, to secure your mortgage or personal financing needs, as well as to receive banking services," said Ahmad Rehman.

KFH offers wealth management products

KFH offers wealth management products
By Chong Pooi Koon Published: 2008/03/14

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The wealth management products are likely to cater to rich customers with RM5 million worth of liquid assets


KUWAIT Finance House (Malaysia) Bhd has started offering wealth management products in partnership with information technology firm FIRIUM Solutions (M) Sdn Bhd and Islamic financial planning consultant Amanie Business Solutions Sdn Bhd.

Managing director Salman Younis said the wealth management business is initiated in line with the bank's retail banking expansion.

KFH plans to open a branch in Johor in April this year with another opening soon in Penang to reach more retail customers. This will add to the three branches in the Klang Valley.

Its wealth management products are likely to cater to rich customers with some RM5 million worth of liquid assets.



These will be introduced in three phases. The first phase which started last month, offers unit trust and Bancatakaful. The second phase of structured product and wasiat, or will-writing will follow soon while the final phase will see the launch of Islamic financial planning services.

"Drawing on KFH's 30 years experience, we will work with our business partners and customers to create innovative solutions to manage, preserve and develop wealth for now and the future generations," Salman said in Kuala Lumpur yesterday.

He said the bank chose to work with FIRIUM as the company has introduced innovative IT solutions to many local and international financial institutions.

FIRIUM is a leading solutions provider in Asia Pacific to the financial services, retail and distribution and telecommunications industries, he said.

Amanie Business Solutions is also not new to KFH. Amanie's chief executive officer Dr Mohd Daud Bakar and his team of qualified consultants, who are well-versed in syariah and Islamic banking, are often invited to conduct training for KFH's senior management.

Dr Mohd Daud is also the chairman of Bank Negara Malaysia's Syariah Advisory Council.

Bank Negara sets up syariah research academy

Bank Negara sets up syariah research academy
Published: 2008/03/28

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BANK Negara Malaysia (BNM) has set up the International Syariah Research Academy for Islamic Finance (Isra) to promote applied research in the area of syariah and Islamic finance.

A repository of knowledge for syariah views or fatwas, it will undertake studies on contemporary issues in Islamic financial industry.

"Isra will contribute towards strengthening human capital development in the areas of syariah and provide a platform for greater engagement amongst practitioners, scholars, regulators and academicians via research and dialogues, both in the domestic and international environment," the central bank said in a statement.

Isra also aims to promote innovation and dynamism into new boundaries of Islamic finance.



Isra, which will be part of the International Centre for Education in Islamic Finance (Inceif), will have a Council of Scholars, comprising eminent local and international syariah scholars.

Dr Mohamad Akram Laldin will be appointed executive director of Isra.

Currently, attached to the International Islamic University Malaysia, Mohamad Akram has done extensive research in the area of Islamic finance and has been actively involved in the global development of Islamic finance by being a member of several syariah committees.

Prudential seeks tie-ups with foreign Islamic banks

Prudential seeks tie-ups with foreign Islamic banks
BY Jeeva Arulapalam Published: 2008/03/31

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PRUDENTIAL Fund Management Bhd (PFMB) is looking to tie up with three foreign Islamic banks operating in Malaysia, to offer Islamic funds, says its top official.

Distributing PFMB's products to onshore clients through these Islamic foreign banks is part of PFMB efforts to become the Prudential Group's syariah fund management hub.

"The first step is for our products to be accepted by these banks and distributed locally before we look to package it for distribution in the Middle East," chief executive officer Mark Toh told Business Times in an interview.

PFMB, which manages all syariah investments and insurance funds for the Prudential Group, is currently finalising a distribution agreement with one of the three Middle Eastern banks based here.



As at January 31 2008, its total onshore syariah funds under management were RM704.5 million.

Syariah investment director Zulkifli Ishak said the main challenge in attracting the Islamic banks to distribute their products was the different interpretations of syariah-compliant products domestically and in the Middle East.

"These banks look at the Malaysian products and their own interpretation before deciding on how to integrate the products with their respective interpretations," said Zulkifli.

The fund management company is also in the process of developing expertise to manage global sukuk funds from Malaysia.

"Hardly anyone offers it because there is very little expertise worldwide to manage such funds. So, we are building the resources now in terms of selecting fund managers, putting up a system to manage it and collating research on sukuk issuances," said Toh.

He said PFMB will depend on the group's overall network for research materials to structure products and portfolios customised for their clientele.

"Since we already have the global equity expertise, we are now focusing on the global sukuk expertise. Our asset management licence allows us to manage global sukuk funds and we should get this out in the next couple of months," said Toh.

PFMB currently manages offshore syariah funds amounting to RM249 million as at January 31 2008, consisting of fund mandates from Indonesia and Dubai.

"We are working towards managing more mandates coming from overseas, while locally we continue to manufacture innovative syariah products," said Toh, adding that PFMB will focus on launching more products in Indonesia, Malaysia and the Middle East.

Prudential was also recently voted best Islamic fund manager by the readers of Islamic Finance News.

'Islamic finance mart needs more hybrid products'

'Islamic finance mart needs more hybrid products'
By Roziana Hamsawi Published: 2008/07/14

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Japan and Hong Kong are now keen to venture into this market and if Malaysian players could become more innovative, they could easily export their expertise, says Zain Ibrahim & Co


THE Islamic finance market is in need of more hybrid products to meet the increasingly sophisticated needs of corporate clients, said Zain Ibrahim & Co (Zico) chairman Datuk Dr Nik Norzrul Thani.

Local players must grab the opportunity to become more product innovative, taking advantage of the strong Islamic finance framework already provided by the authorities.

"Japan and Hong Kong are now keen (to venture) into this market and if we could become more innovative, we could easily export our expertise," Nik Norzrul told Business Times in an interview.

Nik Norzrul, a former dean at the International Islamic University Malaysia, said the presence of foreign Islamic banks in Malaysia has been positive.



"The competition has brought about more product innovation among the local players, although there is still a lot of room for improvement," he said.

Nik Norzrul advises clients on a wide range of legal matters incorporating Islamic finance, banking, offshore finance, debt restructuring, international, corporate and commercial law.

A director of Al Rajhi Banking and Investment Corporation (Malaysia) Bhd, he has also written several articles on corporate and financial issues, particularly on Islamic banking.

Zico is the country's largest legal firm and is active in Islamic finance locally and regionally. It has presence in Indonesia, Singapore and Thailand.

It is the first law firm in Malaysia to establish a syariah advisory firm called ZI Shariah and will soon open an office in Dubai.

ZI Shariah, which is licensed by the Securities Commission to advise on sukuk, has advised clients from the Middle East who came to Malaysia on syariah framework.

The advisory services include not only for the Islamic banking legal matters, but also on personal Islamic financing and syariah-compliant wealth management.

"We have done this quite successfully with the Middle East clients and we are now contemplating to open an office in the region, maybe in Dubai," Nik Norzrul said.

Realising the growing importance of Islamic finance globally, especially among those from the Middle East who are flushed with cash, ZI Shariah has hired Arab-speaking lawyers as well as Arabic classes are being provided for its lawyers and staff.

Nik Norzrul said apart from language, legal advisers must be well equipped in understanding the syariah field, especially in the area of Islamic financing.

There is still lack of experts in this area, he said, when compared with the huge demand for Islamic financial products.

"In Malaysia, for example, why is that Muslims are still generally hesitant to engage an expert in Islamic financial management? Why is there still this assumption that Muslims cannot have wills?" he asked.

Nik Norzrul said this is an area that posed great potential and syariah lawyers should be well equipped with Islamic financial management skill.

"Muslim lawyers can play the role of family counsellors and advise Muslims to plan their finances properly before their death," he added.

Thursday, September 18, 2008

The Dinar: Indispensibility of Hard Money

The Dinar: Indispensibility of Hard Money
to the Islamic Monetary Regime
Imad-ad-Dean Ahmad
Minaret of Freedom Institute - delivered to the American Muslim Social Scientists in Chicago on Oct. 30, 1998 (Abstract)

Economic arguments are marshaled to support the gold standard which was the practice of the Prophet (saws), all of Islamic society during it first four hundred years, and most of civilized society throughout history. Several years ago I made a presentation before Muslim economists meeting at the World Bank at which I presented arguments for what I considered to be the correct Islamic position on a number of fundamental economic issues. Referring to my call for a return to the gold standard, one of the economists asked me why I was for ijtihâd on every issue except that one. He didn't understand that ijtihâd means to struggle for a correct opinion on an issue. It does not necessarily mean rejecting an ancient tradition. In this particular case the ancient tradition happens to be correct.

Far from being a "barbaric relic" (as John Maynard Keynes characterized it, gold is the natural monetary commodity which Allah has provided us for an equitable monetary policy free from the arbitrary or self-serving manipulations of central banks and politicians. In this paper I shall outline the economic arguments as to why the dinar is indispensable for an Islamic monetary regime. My goal is only to emphasize the importance of the issue, not to make an exhaustive treatment. Thus, I shall not address important related issues like financial intermediation, forward transactions or interest. (See, however, Ahmad 1996.) Finally I shall make a suggestion on how a transition may be possible and timely. Indonesia and Malaysia had thriving economies, but suffered from external deficits and a fragile financial sector. Analysts trace the origins to the crisis in Asia to the Chinese and Japanese currency de-valuations. The Mexican currency crisis was the final trigger in confidence problems.

The disagreement between Prime Minister Mahathir Mohamad and former Deputy Prime Minister Anwar Ibrahim over whether to deal with the crisis in Malaysia with currency controls or free markets has since taken an extremely ugly turn (see Johnson 1998). It is not the currency speculators who are responsible for the Malaysian crisis. They merely sought to cash in on the unsound, and, as I shall argue, harâm monetary policy that made the ringgit an unreliable currency.
A government which blames speculators for the consequences of its unsound monetray policy is like a rancher who, having slaughtered his cows on the open plains, blames the vultures for descending on their carcasses.

The monetary problems in both Malaysia and Indonesia have led to political problems. Various solutions proposed are partial solutions. One must attack the fundamental issue. If we go back to fundamentals we can see that the only complete solution is an Islamic monetary system, that is, hard money. The otherwise strong economies of Malaysia and Indonesia, combined with the low price of gold at this time, put them in an unusually good position to make a transition if they can muster the political will, or failing that the religious enthusiasm, to do what our religion mandates anyway. Let us begin by reminding ourselves of the origin of money. Primitive societies engage in barter.

Depending on the particular society, certain commodities eventually become accepted in trade by people who have no immediate need for them because they become aware that others who need them will accept them in trade. The fact that such commodities possess certain "monetary" qualities: a high store of value, divisibility, recognizability, etc., increases their market value because their monetary utility augments the value arising from their other social uses. They never suffer from a crisis of confidence because people know that even if they lost their utility as a kind of promissory note, they would still have some value in themselves. In the time of the Prophet, gold, silver, hard wheat, and a few other commodities served a monetary function. Gold and silver were the best of these and in the early centuries of Islam they were the bimetallic standard of the Islamic world. Because the exchange rate between them was stable there was no problem abiding by this standard for 400 years. Then, the exchange rate between them departed from parity providing an opportunity for the mint to issue debased currencies.

Ashtor (1976, p.257) describes how the vizier of the Ilkhan Gaikhatu's experiment to fund deficit spending in 1294 by issuing "paper money, modeled on the Chinese paper currency ... was a complete failure, as the people refused to accept the bank notes. Economic activities came to a standstill, and the Persian historian Rashid ud-din speaks even of 'the ruin of Basra' which ensued upon the emission of the new money." The door to debasement opened in the next century when the silver to gold exchange rate suffered its first serious change since the rise of Islam. In the early centuries of Islam the rate had always been around 20:1. In the thirteenth century changes in the market led scholars to speculate that the rate had changed to 10:1, but the official rate remained fixed at 20:1. "The stocks of silver in the mints decreased progressively from about 1380.... Whereas the exchange rate of the dirham had for 130 years been 1/20 dinar, that of the debased dirham was 1/25 and later 1/30 dinar" (Ashtor 1976, p. 305). The "main reason was the increased demand in Italy, where the value of silver had risen considerably at the end of the fourteenth century.... At the beginning of the fifteenth century the striking of silver dirhams was discontinued altogether" (Ibid.) Al-Mikrizi blames a high court dignitary who tried to "enrich himself by the striking of copper coins" (Ibid.). The monetary crisis was accompanied by famine and a lengthy civil war. High taxes were levied to equip the armies against repeated revolts. Interest rates rose from 4-8% during the crusades to 18-25% in the fifteenth century (Ibid., p. 324).

Although "the supply of gold from the Western Sudan was never interrupted," Sultan Barsbay in 1425 devalued the dinar "for the first time in the history of the Muslim Near East" (Ibid.). Until then the dinar had always been a gold coin of approximately 4.25 grams. With the devaluation a 3.45 gram dinar called al-Ashrafi "remained the gold coin of Egypt until the end of Mamluk rule" (Ibid.). This was the weight of the European ducat, evidence for the swing in monetary standards away from the Muslim world to the rising Christian West. (Ahmad 1996.) The stability of hard currency is not appreciated by the general populace. People look at the inflation which has hit even the dollar to varying degrees thorughout this century and forget that a high quality suit of clothes which cost ten dinars a century ago still costs ten dinars today. People have come to think of "currency" as "money" though they are extremely different.

Historically, currency may be actual money (coins) or tokens redeemable in coin. Very recently, currencies have been issued not redeemable in anything. For example, the Federal Reserve Notes most of us have in our wallets have for some decades been payable not in gold or silver coin, but in Federal Reserve Notes of other denominations. Under Allen Greenspan the Federal Reserve Board has pursued a tight money policy that has succeeded in easing down America's serious inflation problem, but not without cost. Greenspan's usually prudent judgement has been coupled with fortuitous good luck that will last only as long as God wills. All-too-human manipulation is evident, for example in the Long Term Capital Management debacle bailout. An artificial "sound money policy" is no substitute for natural, I would say divine, monetary regime manifested in a hard money subject to market forces. Money supply sometimes needs to expand or contract according to the exigencies of the times. The supply of gold money can expanded naturally through additional mining or the meltdown of jewelry. It can contract through the diversion of coins into jewelry or other products. The difficulty involved in money supply adjustment is natural and controlled by God. Soft currencies (tokens, paper) are all too subject to the manipulations of governments seeking to engage in deficit spending or bankers seeking to increase their interest revenues through fractional reserve banking.

Some Muslim economists, for example M.A. Choudhury (1997) have noted the superiority of hard currency but only as an element in their campaign against interest. The absence of hard currency is a detriment to the long-term stability of an economy apart from its complicity in the manipulation of interest rates. (Note that soft money permits manipulation of interest rates down as well as up.) Historically interest rates have tended to be much lower when and where the gold standard was adopted than otherwise. The sixty percent interest rate in Malaysia is not unusual given the weakness of the currency. The six percent mortgage rates which American perceive to be "low" today (compared with the double-digit rates in the 1980's) is actually very high compared to the previous century when the gold standard ruled. Some economists have accepted the demonetization of gold despite their opposition to interest.

Chapra (1985) writes: "Although inflation has been a continuing phenomenon, gold prices have fluctuated in a volatile manner after its demonetization due to international speculative forces and gyrations in the rates of interest. Silver prices have suffered the same fate. Both these precious metals cannot hence serve as units of account." Chapra has accepted the circular reasoning that because gold is not used as a unit of account it cannot be used as a unit of account. In fact the opposite is the case. If the one billion Muslims of the world would use gold as their unit of account the volatility (after an initial surge due to the shock of so many people readopting the monetary commodity) would stabilize. Muslims cannot escape the fact that gold is our money. Even if we pretend that it is not, we continue to use it in calculating the nisâb. Instead of fighting the will of Allah, I propose that we embrace it. The fact that gold prices are currently so low is not a reason to avoid it, but rather an unprecedented opportunity to adopt it since we can buy it while the price is low. Unless one uses a hard currency as a unit of account, it is only a matter of time until a disaster strikes the economy. Usually the villain is inflation as the money supply exceeds the demand.

The expansion of the money supply by the government or the banks constitutes a form of fraud. It is akin to counterfeiting for it uses an increase in the overall price levels to subsidize the purchases of the creators of the excess currency. The distortions introduced into the system hit hard at the recipients of fixed incomes. They also tend to subsidize holders of the higher orders of production (e.g., land) the values of which rise faster than the mean of other price levels. Occasionally the money supply may contract too quickly leading to depression. Apart from the political obstacles to adopting a gold standard (the unwillingness of banks and politicians to give up their ability to manipulate the supply of currency), there are several economic obstacles. One is the fear of volatility expressed by Chapra. This fear is ill founded for the reasons given above.

Another is the argument that the Muslim countries do not possess much gold. This is certainly NOT the case for Lebanon and Saudi Arabia. But in any case, it is irrelevant. A country like Malaysia which doesn't possess a large store of gold but which has goods and services to offer can acquire gold through trade. Money is STANDARD. Ibn Khaldun pointed out a long time ago the fallacy in the notion that a society is wealthy because it possesses a large quantity of monetary commodities. He noted that the Sudan has more gold than the more prosperous countries of the east. Further, he argued that the prosperous eastern nations export much merchandise. "If they possessed ready property in abundance, they would not export their merchandise in search of money...." (Ibn Khaldun 1967).

Ibn Khaldun understood that a surplus of money would result in a cash outflow, and correctly argued that a high level of (net) exports argues against this being the situation. Again the essential point is that money is a standard. Currently, the American dollar is the standard. Although really an unbacked fiat currency, it is treated as hard currency because people have confidence. This confidence is not completely unjustified since although the United States makes no promise of redemption it has assets, both liquid and fixed behind it. The United States owns enough gold to buy back 21% of M2 (a measure of the total money supply). A 100% reserve in a monetary commodity is not necessary if one has ample total collateral to maintain confidence.

Thus the islamisation of the money supply of a Muslim country can take place in stages. The first is simply to adopt the dinar as the MEASURE even before one has the backing in gold provided one does not distribute more promissory notes than one has in all types of backing. Further, one can use the current advantageous low price of gold to institute an initial spread in the buy and sell price of the dinar. For example, the official price of the ringgit is 26 cents, but the black market price is lower. Let us assume a true market value of the ringgit of 20 cents. One could replace it with a dinar, which could be minted for approximately $30. Ringgits would be retired over a period of six months to two years. During that period they would be bought at a rate of 150 per dinar or at the official price of gold at the official ringgit exchange rate, which ever is LESS. Over the retirement period, the value of the ringgit would presumably drop against the dollar as holders seek to get rid of them while the price of gold may go up against the dollar as the adoption of a gold currency might fuel speculation of a return of the gold standard.

This means that the new Malaysian currency (the dinar) would RISE in value against the retiring currency AND against the world standard of the dollar. Further, sales of the new coin could be marketed to numismatists and to Muslims around the world to generate dollar and other foreign currency income to aid the financial crisis. After the transition period the country would be forced into monetary and fiscal discipline not by the IMF, but by the God-given discipline of the dinar. A more detailed and lengthy treatment of the transition mechanism beyond the suggestion offered here is needed, but is beyond the scope of this paper. Such a treatment would include a discussion of the monetization of other commodities (e.g., land, oil, rubber) and how one might effect such monetization while retaining the dinar as the unit of account.

Such approaches would be of interest to those policymakers who understand the reasons why commodity currencies are an indispensable element for preventing fraud in banking and public policy, but fear that mandating convertibility into gold would somehow benefit gold-mining countries. Although Ibn Khaldun has shown that this fear is unjustified (it would, on the contrary, open up new trade between gold-mining countries and the countries adopting the gold standard), the existence of such concerns is a political fact of life that must be addressed. Nonetheless, the point of this paper stands that it is no accident that commodity currencies are successful in yielding "sustained macro-stability." I have never been keen on following tradition simply because it is tradition.

The case for following our Islamic heritage on these matters is moral as well as utilitarian. The difficulties of finding an effective and sound monetary policy are obviated in Islam by the monetary regime of the Dinar.

REFERENCES Ahmad, Imad A. 1996, "Comprehensive Development of Muslim Countries: An Interdisciplinary Approach from an Islamic Perspective," Minaret of Freedom Institute preprint series #96-4. Ashtor, E. 1976, A Social and Economic History of the Middle East (Berkeley: Univ. of California). Chapra, M. Umer 1985, Towards a Just Monetary System (Riyadh: The Islamic Foundation). Choudhury, M.A. 1997, Money in Islam: A Study in Islamic Political Economy (London: Routledge). Ibn Khaldun, Wali ad-Din 1967, The Muqaddimah: An Introduction to History, Franz Rosenthal, trans. (Princeton: Princeton Univ. Press), p. 282. Johnson, Ian 1998, "How Malaysia's Rulers Devoured Each Other and Much They Built," Wall Street Journal, v. 232 #87. 30 Oct. 1998: A1.

Wednesday, September 17, 2008

Liberty Dollar

NOTICE: Liberty Dollar is a private voluntary barter currency that protects your purchasing power. It is not intended to be used as "Legal Tender", "Current Money" or "Coin".

Current Alert!



10th Anniversary at $50 Silver Base

In the past ten years, as silver has increased in price, the purchasing power of the Liberty Dollar has increased from the $10, to the $20, to the $50 Silver Base - a startling 500% increase while the US Dollar lost 50%! Which would you prefer, a currency that loses value or appreciates in value? Right now is the best time to protect the purchasing power of your money and profit from inflation. Become a Liberty Associate and get your Liberty Dollars at a discount and really profit. Don't wait for inflation to get worse! Join 250,000 Americas who have taken a stand for a sound monetary system as mandated by the US Constitution.



REAL Money Is Inflation Proof:
Your Liberty Dollar Solution
Bernard von NotHaus
Monetary Architect
09/18/2008

Welcome to the Liberty Dollar: Remember when gas was only 25-cents a gallon? You could take a dollar down to the gas station and buy four gallons for a buck! At that time our dollar was backed by silver - real money. Guess what? That same amount of silver still buys four gallons of gas today! That just proves that real money like gold and silver holds its value and it is the US dollar that buys less and less. As a matter of fact, when you think about it, you realize that gas, food, and almost everything else has NOT gotten more expensive. It only seems that way because the value of the US dollar is worth less and less so it takes more and more of them to buy the same goods and services. Most people think prices have gone up, but actually: it is the value of the US dollar that has gone down. Luckily, there is a simple and profitable solution to higher inflation - good old-fashioned, gold and silver Liberty Dollars, just as our Founding Fathers intended. Look at these charts by the US government.


The national debt has climbed to alarming levels since the Federal Reserve was created in 1913.
Source: U.S. Treasury, Bureau of the Public Debt

As a result, the Federal Reserve Note (US dollar) has lost 96% of its purchasing power since 1913.
Source: U.S. Dept, of Labor, Bureau of Labor Statistics, CPI


Since 1913, when the Federal Reserve was created by Congress, your money has lost 96% of its purchasing power due to inflation. The more "money" the Federal Reserve creates - the less your "money" buys. It is the Federal Reserve who creates inflation when it issues US dollars backed by government debt.

The national debt grew to $6 trillion from 1913 to 2001. In the next three years it increased a trillion to $7 trillion dollars in 2004. In the following year it increased sharply to over $8 trillion dollars. The national debt is now well over $9.5 trillion dollars! Congress just raised it to almost $11 Trillion dollars!! This accelerating debt is alarming and dangerous to your money!

Now you can profit from the coming inflation with the "inflation proof" Liberty Dollar!
Hi. My name is Bernard von NotHaus. I was so concerned about what was happening to our "money" I created the Liberty Dollar. For 25 years, I was the Mintmaster at the Royal Hawaiian Mint and devoted 23 years to the study of money, why it is valuable, and how we use it to fulfill our dreams. Like you, I am paying a lot higher gas prices, but I am also making a lot more money using the Liberty Dollar.



My 25 Years at the Mint

While I was the Mintmaster at the Royal Hawaiian Mint in Hawaii I pursued a secret project. For over 23 years I developed a value backed paper currency to complement the Mint's gold and silver commemorative business. I wanted to create a totally new inflation proof currency in precious metals that would represent real gold and silver stored in an independent warehouse. I called my secret project the "Hawaiian Sovereign Currency".

Oh, it was beautiful with the Statue of Kamehamaha and all the flora of Hawaii. Then one night, while I was working at the Waikiki Branch Mint, an elderly gentleman stopped by. As he was one of our collectors and a paper money collector, I decided to share my secret project with him. Oh, he loved the Hawaiian currency idea. So I shared a bit more of my plan. He was enthused and asked for more details. Over a two-hour period, I shared my whole currency plan with my new-found friend.

Suddenly, he stopped and appeared to fall into a deep thought and suggested that I take my inflation proof currency to the mainland! He said Americas were headed for major problems and needed to protect their purchasing power. Leave Hawaii!? What heresy I thought! But with my 25th anniversary at the Mint approaching, I decided to retire and created the Liberty Dollar as my philanthropic patriotic mission.

Quickly I replaced the Statue of Kamehameha with the Statue of Liberty and the Hawaiian palm fronds with the geometric artwork that most paper money is known for and the Liberty Dollar was introduced on October 1, 1998. Of course all the interlocking checks and balances, audits, and ultra high security devices that I had designed in the Hawaiian currency remained the same.

Years later I have created this website so you can take control of your money and profit from inflation. Of course, this is a big job, so I am asking for your help. The best part is that it is fun to use Liberty Dollars that protects and grows the purchasing power of your money!

So please remember, the Liberty Dollar is a private voluntary barter currency. It is not government money so it is not intended to be used as "Legal Tender", "Current Money" or a "Coin".



Inflation Proof Money - At a Discount!
Yes, Hawaii is a wonderful place but raising a family in the high-priced Islands was tough. It just wasn't gasoline that was expensive, everything was expensive! I know how difficult it is to provide for a family. And after you retire, it is even worse on a fixed income! US dollar backed only by government debt is bad for everyone! That's why I created the Liberty Dollar.

If someone gave you a choice between a stack of ordinary ten-dollar bills and a stack of ten-dollar bills that were printed on the back with a coupon for 5 gallons of gasoline, good at any gas station in the country, which would you choose?

The first stack is just dollar bills. But the second stack are dollar bills backed by gas. And if gas prices go up, you can use the second stack for the same amount of gas to fill your tank.

If someone gave you a choice between a stack of ordinary ten-dollar bills and a stack of ten-dollar bills that were printed on the back with a coupon for 5 gallons of gasoline, good at any gas station in the country, which would you choose?

The first stack is just dollar bills. The second stack is also dollar bills, or if gas prices go up, you can use the back of the bills and fill your tank.

You'd have to be crazy to take the first stack! Right? Why not get the benefits of a negotiable currency coupled with the redeemability for a useful commodity, in this case, gasoline? If gas prices go up, you win while everyone else complains about the high cost of gas! If prices don't rise, you still have your ten-dollar bills!

For that reason, I am pleased that the Liberty Dollar is already the second-most popular and the fastest-growing currency in America! It's real gold and silver instead of being backed by national debt like the US dollar. When you hold the Liberty Dollar, you own the silver. When you pay with Liberty Dollars, they now own silver. Pretty neat, huh?

On the other hand, when you hold US dollars, you own debt that you will eventually have to repay. When you give US dollars to someone as payment, they now have debt. Ouch!



100% Backed by Gold & Silver
The Liberty Dollar is private, inflation proof currency that is devoid of debt. It's a currency of the people, for the people, and by the people. Liberty Dollar does not cause our national debt to go up when you use it. In contrast, every Federal Reserve Note that is created adds to our national debt.

Liberty Dollar unites everybody who is concerned about their money: liberals, conservatives, minorities, libertarians, and greens are all enthusiastic about the Liberty Dollar. In fact, the only people who don't like are the government bankers. Anything with such wide appeal must be good.

Liberty Dollar protects you and helps local economies thrive and prosper. Liberty Dollars spent in your community tends to stay in your community. US dollars tend to get sucked out to New York banks or big box retailers.

Liberty Dollar helps educate people about money, a topic most people simply never consider. The facts about money are simple. You either have it or not. When the government don't have it they make it out of thin air and steal your purchasing power. This is wrong.



Works Just Like US Dollars
Just as FedEx brought competition to the Post Office and succeeded, the Liberty Dollar emulates the same model by offering an inflation proof currency. Now you can become successful too.

The Liberty Dollar brings free enterprise to the creation of money. Doesn't it just make sense that when the underlying commodity increases in value, shouldn't the purchasing power of the currency increase in value? Well that is exactly what happened to the Liberty Dollar. In 2004 the currency Moved Up from the $10 Silver Base to the new $20 Silver base and all Liberty Dollars DOUBLED in value. Just imagine, while your US Dollars are losing purchasing power, the Liberty Dollars are appreciating in value and rewarding everyone who has them!

Plus the Liberty Dollar is easy for merchants and customers to use because its "unit of account" is exactly so it functions dollar-for-dollar with the US dollar.

Local merchants find the Liberty Dollar particularly beneficial, because it is profitable, circulates freely, builds traffic, grows their business, and increases customer loyalty.

The Liberty Dollar was specifically designed to circulate in the local community for the advantage of the local economy so it may not be deposited into a bank. That way it cannot be whisked away, and remains in your community and circulates for the good of both the merchants and consumers.



Time For a New Dollar
The three best reasons to use the Liberty Dollar are: Have fun, do good, earn money.

First, it's FUN. You'll have merchants asking lots of questions, friends gathering around to see the currency, and you can become an expert on money - all by getting some Liberty Dollars.

Second, it's good for your community. As a community currency, Liberty Dollars don't disappear, so when you spend them, they stay in the local economy.

Third, it's profitable to become a Liberty Associate or a Liberty Merchant. Plus using the Liberty Dollar will attract new business, generate advertising, and build a loyal customer base around the Liberty Dollar! And by giving out the Liberty Dollar in change, you can earn more!

The Liberty Dollar is available in Gold & Silver and provide:

Economic stability
Prosperity for people
Freedom from inflation
Safer storage of value
Greater financial privacy
Trusted basis for saving
Pride of truly owning your own money
Better control of your finances
Enhancing local self-reliance
Encourages ecological sustainability
Stimulates local economies and employment
Profitability for people, not banks
Independence from current banking system
Improved social and political systems
Prevents large-scale, systemic failure
Disciplined government growth and control
A stronger community for family and business
Provides a solution to economic and social difficulties
Insulates local economies from national economic trends
Allows a community or a region to set its own standards
Protection against a manipulated monetary system
Protection from the next national monetary crisis
Greater protection of individual rights and liberties
Returns the monetary power to the people
Provides a financial deterrent to war
Here's what people who use the Liberty Dollar are saying:

"I now pay for my lunch in real money."
V. Callaway, Tacoma WA

"I simply hand them the currency and 95% of the businesses accept it."
C. Athanas, Austin TX

"Given time, it'll be as common as credit cards."
T. Curtis, Calabasses CA

"It is fun and very simple to use."
L. Farrenkopf Victor MT

"This is a blast. I love getting the word out about the new money!"
B. Ibarra, Buda TX

G. Edward Griffin, the noted author on the Federal Reserve said: On page 573 of "The Creature from Jekyll Island", I wrote that before we could abandon Federal Reserve Notes, we first had to be able to convert them into real money. I said: "That means we must create an entirely new money supply which is 100% backed by precious metal; and we must do so in a reasonably short period of time." Well you have to be careful what you recommend, because Bernard von NotHaus did exactly that. And although I initially thought there were too many obstacles, to my surprise, the more I studied the details of his plan, the more convinced I was that by Jove, it just might work! My business, The Reality Zone, is a Liberty Associate, and I urge you to get in on the ground floor and join this growing group of concerned Americans as a Liberty Associate now!



REAL Money You Can Trust
A national network of thousands of Liberty Associates, Merchants and Regional Currency Offices already exists to assist you. Today there are over 250,000 people using $60 million Liberty Dollars. And every day it continues to grow to meet the challenge of the depreciating US dollar. There is probably someone near you already. Now you can protect your money and profit. You and your family need not be at risk of a currency crisis because the Liberty Dollar provides guaranteed protection because it's real gold and silver!

That is why I'm offering the new currency to you on a completely risk-free basis with three bonuses.



Liberty Dollars are Yours Risk-Free
Here is the best news of all. I have been intending to create this web site for a long time. So now that it is finally completed, you have arrived just in time to take advantage of this unprecedented offer!

Everybody in the Liberty Dollar organization thinks that our normal dollar-for-dollar exchange rate for those who are not Liberty Associates and the market driven discounted rate for Liberty Associates is amazingly low for such a valuable currency. But because the Internet has reduced many of our costs, I'm doing a test until 09/18/2008 . Depending on its effect, we may or may not continue this Special Offer after that date.

Just order the "Special" today and get these three bonuses:

Bonus #1
Free DVD of the Learning Channel's special "Making Money"
Get your own personal DVD of the groundbreaking Special, which featured the Liberty Dollar with the US Treasury and the Federal Reserve. Find out how the country's monetary powers reacted to the Liberty Dollar and why I was the first person featured on camera to discuss the current monetary situation. Normally this DVD would cost $29, but it is yours free with the Special Offer below. Click here for a short clip of the DVD. Receive a free copy with your first order of $85 Liberty Dollar. Just order the "Special Offer" below.

Bonus #2
Free Book "Liberty Dollar SOLUTION To the Federal Reserve"
Sure there are a lot of books out there about money. But my 500-page book is the only one that presents a proven, positive, profitable solution to use gold and silver currency in a peaceful voluntary manner. Plus, SOLUTION features 18 expert contributors including Dr. Murray Rothbard, Dr. Richard H. Timberlake, G. Edward Griffin, Congressman Ron Paul, ex IRS agent John Turner, and even Alan Greenspan. Normally this book is $15.00 but it is yours free with the Special Offer below.

Bonus #3
Second Free Book "Economic Solutions" By Peter Kershaw
This book brings many historic and interesting details about money that cannot be found anywhere else. Normally $9.00, it is yours free with the Special Offer below.



Full one-year 100% Money Back Guarantee
I insist you order your first Liberty Dollars with zero risk. The Special Offer is completely at my risk. Why am I going to such lengths? Because even though I have been featured on the Learning Channel and have become well known over 30 years, I want you to feel absolutely certain that there is no way you can be "taken".

So take one full year to examine the Liberty Dollar and really get into it. That's right! You have 365 days to put the new REAL money to the test. Show it to your friends. Test it with your local merchants. Find out how powerful gold and silver money really is. Try the Liberty Dollar for a full year. I'm confident you'll never want to send it back. The one ounce $50 Silver Liberty is just beautiful and wonderful to hold. Plus the Liberty Dollar is truly a valuable currency that will increase in value as the US dollar depreciates and the price of gold and silver goes up.

But if you are not completely satisfied with the Special Offer for any reason, just return it and we'll refund your entire payment. Right up to the last day of the 365-day, guaranteed.



Your First Liberty Dollars for Only $85
Now for this limited time, you can catch the excitement of using Liberty Dollars for only $85 with this Special Offer and the full one-year 100% Money Back Guarantee. The simple truth is that the Liberty Dollar works and it will work for you.

Order Now. Just click here for the Special Offer!

Please Contact Us...
If you have any problems or wish to speak to someone, please call 1.888.LIB.DOLLAR or call direct at 888.421.6181. If the lines are busy, please leave a message or email us at Info@LibertyDollar.org and we will get back to you ASAP.

Please keep in mind that when you order online you will get the fastest service and you don't have to wait for the arrival of your order to start having fun!

I look forward to getting an email from you. I want to hear how you used the Liberty Dollar and add your Success Story to our list. Even though I get an enormous amount of mail, please write to me. I love hearing every Success Story when you use the Liberty Dollar.

Sincerely,


Bernard von NotHaus
Monetary Architect

P.S. Time is critical as the price of silver changes all the time. Luckily the price of silver is still low and affords an excellent entry level. Order today so your money will be protected tomorrow. The Liberty Dollar provides a proven positive REAL money solution that actually pays you to use it. Plus you can earn more money, do good, and have fun with the Liberty Dollar.

Your money has already lost 96% of its purchasing power since the Federal Reserve was created in 1913. With the accelerating rate of depreciation and the alarming rate of deficit spending by the government, your US dollar is going to lose more purchasing power. Protect your money, family, and business by getting REAL money, the new gold and silver Liberty Dollar, now. Become a Liberty Associate today and start profiting from inflation.



Thank you for visiting the Liberty Dollar site.
I hope you will take action to protect your purchasing power with some Liberty Dollars.
And remember, as a Liberty Associate, you can get Liberty Dollars at a discount.
Bernard von NotHaus - Monetary Architect



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