capital goods. Low real interest rates, rapid employment growth and fiscal transfers raised both consumption and investment spending. Increased public investment under the government’s economic transformation programme, especially in the oil, gas and infrastructure sectors, is an example of successful Keynesian ‘pump priming’ that has, unsurprisingly, boosted economic activity and raised the level of employment. The indications are that Malaysian macroeconomic management has an intelligent and perceptive activist dimension that does not sit well with unfettered market

reverse flow of funds as soon as there was a negative shock. Shocks can result from a number of factors, including natural calamities and unanticipated declines in the economies of borrowing countries due to changes in interest rates or relative export and import prices. Such shocks lead to a decline in confidence in the borrowing country’s ability to honour its liabilities in foreign exchange. The rapid outflow of foreign exchange, which would not have been possible in the case of equity financing or even medium- and longterm debt, led to a sharp fall in exchange rates

, rather than the interest rates, are administratively determined. There is presently neither theory nor empirics to suggest that these profit dividend rates have a stable linkage with the inflation rate. Financial Institutions The Iranian banking sector comprises 28 financial institutions. They are grouped under four categories: (1) four public commercial banks; (2) four public specialized banks, associated with different sectors of the economy, namely agriculture, housing, export and mining industry; (3) 16  small private banks; and (4) four large privatized banks. The

against interest: is it compelling? 143 or the principal amount of the loan with the predetermined rate of return stands in the way. There was a reverse flow of funds as soon as there was a negative shock. Shocks can result from a number of factors, including natural calamities and unanticipated declines in the economies of borrowing countries due to changes in interest rates or relative export and import prices. Such shocks lead to a decline in confidence in the borrowing country’s ability to honour its liabilities in foreign exchange. The rapid outflow of foreign

borrower’s credit risk only; (3) on the liability side, the depositors don’t take on the bank’s credit risk: accordingly, EU law imposes the compulsory membership on one of the deposit-guarantee schemes recognized in the home member state upon the entities applying for a European licence. Furthermore, in conventional banking the provision of a predetermined interest rate is intended as a natural feature of sight accounts and any member state forbidding banks from remunerating sight accounts would infringe the freedom of establishment. Indeed, in the Caixa Bank case15 the

client has not fully paid on the due date or soon after. The vast majority of loans in the sample were conventional loans, as only 5 per cent of the loans were Islamic ones. Nevertheless, the number of Islamic loans was sufficient for such an investigation, given the size of the full sample. It is of interest to stress that most Islamic loans were murabaha or ijara. They found that default rates were much lower for Islamic loans, that is, the hazard rate on Islamic loans was less than half that of conventional loans. How to explain this finding? The authors suggest

substitute rather than natural parents.19 Consequently, they develop psychological problems which adversely affect their moral and intellectual development and lead to juvenile delinquency. The quality of the future generation consequently declines. Any society where the quality of the future generation goes down significantly may not be able to maintain its moral, intellectual, technological and military supremacy in the long-run. In addition to the rise in family disintegration, there is also a decline in the willingness to get married. The marriage rate is currently at