The financial crisis has had a devastating impact on financial markets in the US and other western countries. Particularly hard hit were investors who purchased mortgaged backed securities, since as the value of the asset declined below the amount of debt, investors took large losses. Countries that follow Islamic Banking and Finance (IBF) have largely been spared this loss due to the types of bonds that are allowed. This research summarises the problem in the Western World and then compares it to a similar problem faced by Dubai World who had a (standstill) when they were unable to make a required payment. It appears that holders of Dubai World sukuk will be spared losses because of Islamic banking laws. We examine both the short term and long term effects.
Busler, M. (2011), "The financial crisis – Western banking versus Islamic banking", World Journal of Entrepreneurship, Management and Sustainable Development, Vol. 7 No. 1, pp. 1-16. https://doi.org/10.1108/20425961201000026Download as .RIS
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