The ruling on trading in currency, and a discussion regarding some of the rulings of currency exchange.
Machine translationRead the Arabic original
The questioner : Some of the brothers, our Shaykh, asked this question, saying:The Shaykh : What do you say about trading in currency? I told him:The Shaykh : He said: It is not permissible; this is a type of gambling. He said: Why? Well, what is the currency that we buy? It is currency in exchange for currency, and this currency is for one person and that currency is for another? I told him: It is not for one person. This lira is not the value of the paper; it is the value of the currency you deal in. From the paper aspect, it is just a piece of paper, but from the aspect of its benefit, the currency rises and falls, soThe Shaykh : he said: There is gambling in this, except for a need. He said: Our need is sometimes that, being drivers on the route, we need large amounts. I told him: You spend according to your need.
The Shaykh : No, he means his need, meaning he wants to trade.
The questioner : No, it is trade. We told him: No, it is not trade. No, he says that because the car spends a lot of our needs there, we repair the car, its parts, and so on. So from here, the need is not... He said: We do not take paper currency to sell it; we do not trade in it. We spend according to our need, but our need is a large amount, not a small amount. We told him: You [spend] according to your need. This is the prohibition of exchange.
The Shaykh : Because it has no value.
The questioner: Because it has no value; how? I mean, now one person—my uncle—currently has ten thousand Jordanian dinars that he owns. He hears the news that the dinar will go down, so he converted it all to American dollars. Let us suppose he bought the dollars at what price, for example?
The Shaykh : This is understood.
Another questioner : Yes, he made a profit after two or three years.
The Shaykh : He got the dollars, but before they entered his pocket, the dollar went down. And this has happened repeatedly!
Another questioner : But the fear is that the dinar will go down more than the dollar; so what do you tell him?
The questioner : You have now shifted the question, not to trade... You have shifted it from a question about trade to a second matter: that you want to preserve the value of your money from the Jordanian dinar, for example, to the dollar.
Another questioner : It has become a commercial matter automatically; so is it permissible?
Another questioner : This is the answer from the professor.
Another questioner: Yes.
The Shaykh : I say that one should spend for a need. As for buying in order to trade, whether a little or a lot, it is not permissible.
Another questioner : It is not trade, but for preserving value.
The Shaykh : We are saying this and that, we are speaking this and that. One person has his currency, for example, Syrian. The Syrian [currency] does not work here, so he goes to buy from the butcher and the baker, and so on. He wants to live, for example, he wants to convert this currency to Jordanian. With the increase and decrease, there is no way out; this means it is for a need. With the increase and decrease, there is no way out.
Another questioner : ... he converts it to Jordanian.
The Shaykh : Because he needs it. But one who buys the Syrian currency now with the hope that the Syrian currency will improve, and then is surprised that it has dropped further, he loses; this is gambling. I call it gambling.
Another questioner : It is gambling.
The Shaykh : Yes, well; what did you say just now about the Iraqi currency?
The questioner : This is a hundred percent gambling, but there is a different question.
The Shaykh : ... this is a hundred percent gambling. A beautiful and correct expression. There is gambling that is not a hundred percent; there is gambling that is fifty or sixty percent.
Another questioner : It is also forbidden.
The Shaykh : It is also forbidden. That is, this person, when he sees that the price of the American dollar is stable, he converts his Jordanian currency to the American dollar. Has the American dollar ever gone down in history, to your knowledge?
Another questioner : It went down, it went down, but...
The Shaykh : It went down. Allow me, this is one thing. The second thing, you know that the American dollar, or the British pound, or any currency in the world, every country raises its currency and lowers it to support its economy, right or wrong?
Another questioner : By Allah, Allah knows best.
The questioner : No, there is doubt in this matter.
The Shaykh : No, there is absolutely no doubt... Allow me a moment.
The questioner : The currency preserves its value according to the International Monetary Fund, according to what is set, according to its support for its currency from other currencies or from gold.
The Shaykh : Allow me.
The questioner : That is, there is no country that can raise the value of its currency; some can lower the value of their currency, but they cannot raise it.
The Shaykh : What is this talk?! This is completely strange talk from you; because you are considered an expert in this matter in my view. I know that France, in a recent period, lowered the value of the franc.
The questioner : Am I not telling you? You can lower its value, but as for raising it.
The Shaykh : Well; so what?
The questioner : Raising it? No, it is not permissible to raise it.
The Shaykh : That is not reasonable!
The questioner : Every country can lower the value of its currency, but raising it, no.
The Shaykh : I go along with you. I cannot argue with you now about the exception you are mentioning. I will argue with you on the point you agreed with me on.
The questioner : Which is the lowering.
The Shaykh : Which is the lowering. Why do you lower it? Is it not out of consideration for its economy? Is it not out of consideration for its own benefit?
The questioner : Of course, this is certainly out of consideration for supporting its economy.
The Shaykh : Stay with me. So, I am a man who was confident in the American currency, the dollars. So, in my foolishness, greed, and commercial avarice, I spent my millions of Jordanian dinars and bought them as dollars, and... the American economic policy suggested to them to lower what? The dollar. What happened to me?
The questioner : A loss.
The Shaykh : Well; the cause of this loss is the country in which I trusted the strength of what? The strength of its economy, and consequently the strength of its paper currency. Whereas if it were gold or silver, no matter how much it dropped or became cheap, a person would not suffer a significant loss; like any commercial commodity; because this is a currency with no value except a customary value among countries, its owners...
The questioner : Even gold, our professor, there was a period when people lost large amounts in it.
The Shaykh : Why am I this way? What did I tell you? What did I tell you just now?
The questioner : It reached a point where they measured gold by this dollar. It reached nine hundred dollars; the ounce reached nine hundred dollars, and it suddenly dropped to two hundred dollars. There were huge losses in 1980, 1982.
The Shaykh : Allow me, did the loss come from the cheapness of gold or from the games of the countries?
The questioner : No, of course, from the games of the countries.
The Shaykh : So do not say the cheapness of gold. May Allah reward you.
The questioner : Of course, we deduce this talk from the games that happen in the financial markets.
The Shaykh : Therefore I tell you: Gambling... Currency is gambling!
Another questioner : Well; now, professor, if I know, for example, that the Jordanian dinar is going to go down, I have correct information.
The Shaykh : It is not permissible, it is not permissible.
Another questioner : I do not build on gambling, and I do not have the intention to trade in currency, and I do not have the intention, but I have information that the Jordanian dinar is going to go down; so is it permissible, in order to preserve the value of my money, that I convert it to the dollar, for example, or on the basis that I feel, for example, that any other currency might reduce my loss in the case of preserving the value of the dinar?
The Shaykh : You have no way other than to buy gold, but, as for paper currency!
Another questioner : Well, do you know now, professor, how they buy and sell in gold? Suppose I bought gold, on the assumption that I bought gold, they measure it now; we have gold sellers, how do they measure the value of the gram? They raise it in the Jordanian dinar and lower it; on what basis? On the basis of the dollar. They come and say, for example, globally today the dollar in the ounce is four hundred dollars. Now, just yesterday, the ounce of gold was four hundred dollars globally. They measure the value of gold in dollars. When the dollar goes down, they measure the value of gold in dollars again.
Another questioner : Does the gold go down?
Another questioner : It goes down with the value of the dollar; it always follows the dollar.
The questioner : You are now, as you mentioned,The Shaykh : that you buy gold with your Jordanian dinars, so generally, you preserve your dinars with this gold better than if you bought dollars. This is clear; that is, this is known.
Another questioner : Is it not the same thing that they measure it in dollars?
The questioner : And even if they measure it in dollars, did you not say the dollar goes up and down now?
The Shaykh : I am solving the problem for you, and I have no economic background. Can you imagine that even the strongest currency in the world could completely collapse and lose its value, or not?
Another questioner : That is a certainty.
The Shaykh: For sure?
Another questioner : Yes.
The Shaykh : Good; do you think the value of gold could disappear?
Another questioner: No.
The Shaykh : But anyway, that is enough.
The questioner : This is clear: that gold remains gold.
The Shaykh : That is enough. And when you say that the price of an ounce of gold has become so many dollars, that is the game we are talking about: that a strong state, when it is in its interest to raise the value of its currency, raises it, but not in the way you mentioned earlier; that it is not in its power to raise it, but it raises it through economic means.
The questioner : A turn.
The Shaykh : Right or wrong? We are paying attention now.
... and one deviation leads to another deviation, but of course, not all deviations are of the same degree.
The questioner: Yes.
The Shaykh : Yes, as we said earlier: Adnan convinced me with the Prophet's (peace and blessings be upon him) supplication; meaning, once. But he said: , they said: O Messenger of Allah, and for those who cut their hair? He said: .
The questioner : Consoling the heart [everyone laughs!].
The Shaykh : So our brother Adnan convinced me with this.
The Shaykh : No, he means his need, meaning he wants to trade.
The questioner : No, it is trade. We told him: No, it is not trade. No, he says that because the car spends a lot of our needs there, we repair the car, its parts, and so on. So from here, the need is not... He said: We do not take paper currency to sell it; we do not trade in it. We spend according to our need, but our need is a large amount, not a small amount. We told him: You [spend] according to your need. This is the prohibition of exchange.
The Shaykh : Because it has no value.
The questioner: Because it has no value; how? I mean, now one person—my uncle—currently has ten thousand Jordanian dinars that he owns. He hears the news that the dinar will go down, so he converted it all to American dollars. Let us suppose he bought the dollars at what price, for example?
The Shaykh : This is understood.
Another questioner : Yes, he made a profit after two or three years.
The Shaykh : He got the dollars, but before they entered his pocket, the dollar went down. And this has happened repeatedly!
Another questioner : But the fear is that the dinar will go down more than the dollar; so what do you tell him?
The questioner : You have now shifted the question, not to trade... You have shifted it from a question about trade to a second matter: that you want to preserve the value of your money from the Jordanian dinar, for example, to the dollar.
Another questioner : It has become a commercial matter automatically; so is it permissible?
Another questioner : This is the answer from the professor.
Another questioner: Yes.
The Shaykh : I say that one should spend for a need. As for buying in order to trade, whether a little or a lot, it is not permissible.
Another questioner : It is not trade, but for preserving value.
The Shaykh : We are saying this and that, we are speaking this and that. One person has his currency, for example, Syrian. The Syrian [currency] does not work here, so he goes to buy from the butcher and the baker, and so on. He wants to live, for example, he wants to convert this currency to Jordanian. With the increase and decrease, there is no way out; this means it is for a need. With the increase and decrease, there is no way out.
Another questioner : ... he converts it to Jordanian.
The Shaykh : Because he needs it. But one who buys the Syrian currency now with the hope that the Syrian currency will improve, and then is surprised that it has dropped further, he loses; this is gambling. I call it gambling.
Another questioner : It is gambling.
The Shaykh : Yes, well; what did you say just now about the Iraqi currency?
The questioner : This is a hundred percent gambling, but there is a different question.
The Shaykh : ... this is a hundred percent gambling. A beautiful and correct expression. There is gambling that is not a hundred percent; there is gambling that is fifty or sixty percent.
Another questioner : It is also forbidden.
The Shaykh : It is also forbidden. That is, this person, when he sees that the price of the American dollar is stable, he converts his Jordanian currency to the American dollar. Has the American dollar ever gone down in history, to your knowledge?
Another questioner : It went down, it went down, but...
The Shaykh : It went down. Allow me, this is one thing. The second thing, you know that the American dollar, or the British pound, or any currency in the world, every country raises its currency and lowers it to support its economy, right or wrong?
Another questioner : By Allah, Allah knows best.
The questioner : No, there is doubt in this matter.
The Shaykh : No, there is absolutely no doubt... Allow me a moment.
The questioner : The currency preserves its value according to the International Monetary Fund, according to what is set, according to its support for its currency from other currencies or from gold.
The Shaykh : Allow me.
The questioner : That is, there is no country that can raise the value of its currency; some can lower the value of their currency, but they cannot raise it.
The Shaykh : What is this talk?! This is completely strange talk from you; because you are considered an expert in this matter in my view. I know that France, in a recent period, lowered the value of the franc.
The questioner : Am I not telling you? You can lower its value, but as for raising it.
The Shaykh : Well; so what?
The questioner : Raising it? No, it is not permissible to raise it.
The Shaykh : That is not reasonable!
The questioner : Every country can lower the value of its currency, but raising it, no.
The Shaykh : I go along with you. I cannot argue with you now about the exception you are mentioning. I will argue with you on the point you agreed with me on.
The questioner : Which is the lowering.
The Shaykh : Which is the lowering. Why do you lower it? Is it not out of consideration for its economy? Is it not out of consideration for its own benefit?
The questioner : Of course, this is certainly out of consideration for supporting its economy.
The Shaykh : Stay with me. So, I am a man who was confident in the American currency, the dollars. So, in my foolishness, greed, and commercial avarice, I spent my millions of Jordanian dinars and bought them as dollars, and... the American economic policy suggested to them to lower what? The dollar. What happened to me?
The questioner : A loss.
The Shaykh : Well; the cause of this loss is the country in which I trusted the strength of what? The strength of its economy, and consequently the strength of its paper currency. Whereas if it were gold or silver, no matter how much it dropped or became cheap, a person would not suffer a significant loss; like any commercial commodity; because this is a currency with no value except a customary value among countries, its owners...
The questioner : Even gold, our professor, there was a period when people lost large amounts in it.
The Shaykh : Why am I this way? What did I tell you? What did I tell you just now?
The questioner : It reached a point where they measured gold by this dollar. It reached nine hundred dollars; the ounce reached nine hundred dollars, and it suddenly dropped to two hundred dollars. There were huge losses in 1980, 1982.
The Shaykh : Allow me, did the loss come from the cheapness of gold or from the games of the countries?
The questioner : No, of course, from the games of the countries.
The Shaykh : So do not say the cheapness of gold. May Allah reward you.
The questioner : Of course, we deduce this talk from the games that happen in the financial markets.
The Shaykh : Therefore I tell you: Gambling... Currency is gambling!
Another questioner : Well; now, professor, if I know, for example, that the Jordanian dinar is going to go down, I have correct information.
The Shaykh : It is not permissible, it is not permissible.
Another questioner : I do not build on gambling, and I do not have the intention to trade in currency, and I do not have the intention, but I have information that the Jordanian dinar is going to go down; so is it permissible, in order to preserve the value of my money, that I convert it to the dollar, for example, or on the basis that I feel, for example, that any other currency might reduce my loss in the case of preserving the value of the dinar?
The Shaykh : You have no way other than to buy gold, but, as for paper currency!
Another questioner : Well, do you know now, professor, how they buy and sell in gold? Suppose I bought gold, on the assumption that I bought gold, they measure it now; we have gold sellers, how do they measure the value of the gram? They raise it in the Jordanian dinar and lower it; on what basis? On the basis of the dollar. They come and say, for example, globally today the dollar in the ounce is four hundred dollars. Now, just yesterday, the ounce of gold was four hundred dollars globally. They measure the value of gold in dollars. When the dollar goes down, they measure the value of gold in dollars again.
Another questioner : Does the gold go down?
Another questioner : It goes down with the value of the dollar; it always follows the dollar.
The questioner : You are now, as you mentioned,The Shaykh : that you buy gold with your Jordanian dinars, so generally, you preserve your dinars with this gold better than if you bought dollars. This is clear; that is, this is known.
Another questioner : Is it not the same thing that they measure it in dollars?
The questioner : And even if they measure it in dollars, did you not say the dollar goes up and down now?
The Shaykh : I am solving the problem for you, and I have no economic background. Can you imagine that even the strongest currency in the world could completely collapse and lose its value, or not?
Another questioner : That is a certainty.
The Shaykh: For sure?
Another questioner : Yes.
The Shaykh : Good; do you think the value of gold could disappear?
Another questioner: No.
The Shaykh : But anyway, that is enough.
The questioner : This is clear: that gold remains gold.
The Shaykh : That is enough. And when you say that the price of an ounce of gold has become so many dollars, that is the game we are talking about: that a strong state, when it is in its interest to raise the value of its currency, raises it, but not in the way you mentioned earlier; that it is not in its power to raise it, but it raises it through economic means.
The questioner : A turn.
The Shaykh : Right or wrong? We are paying attention now.
... and one deviation leads to another deviation, but of course, not all deviations are of the same degree.
The questioner: Yes.
The Shaykh : Yes, as we said earlier: Adnan convinced me with the Prophet's (peace and blessings be upon him) supplication
and for those who cut their hair
وللمقصِّرينO Allah, forgive those who shave, O Allah, forgive those who shave, O Allah, forgive those who shave
اللهم اغفر للمحلِّقين ، اللهم اغفر للمحلِّقين ، اللهم اغفر للمحلِّقينand for those who cut their hair
وللمقصِّرينThe questioner : Consoling the heart [everyone laughs!].
The Shaykh : So our brother Adnan convinced me with this.
Source
www.al-albany.com
The Arabic text is copied verbatim from the original source, without any edits.