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The most prominent and persistent problems of our global monetary system are instability and imbalances. We propose an international monetary model to solve these problems while at the same time move the model closer to Maqāṣid Sharīʿah (objectives of Sharīʿah). We name this an organic global monetary model or abbreviated as OGM. OGM is an international monetary model directly built on the national monetary system of each member country so that the two can co-exist.

Model design, theory and literature.

The model can eliminate interest rates at the central bank level, create non-tradable international money, and make a more stable international monetary system.

Original.

The purpose of this study is to investigate shari’ah scholars’ views and experiences pertaining the shari’ah issues, challenges and prospects in Islamic derivatives. Specifically, this paper critically examines the criticisms toward conventional derivative instruments and the controversies surrounding underlying contracts and current Islamic derivative products.

This study uses qualitative methods to form a deeper understanding of shari’ah scholars’ perception and experience on Islamic derivatives. Semi-structured interviews were conducted with five shari’ah scholars who are currently working in Islamic financial institutions in Malaysia and Singapore. This study used phenomenological techniques for its data analysis.

This study has found that shari’ah scholars are aware of the shari’ah issues surrounding Islamic derivatives and have provided comprehensive insight on the solution to these issues. It was found that it is important to take into account the derivatives instruments in Islamic financial industry because of the need for hedging and risk mitigation within Islamic financial institutions. Nonetheless, the study has also found that the use of wa’ad contracts to structure Islamic profit rate swaps and foreign currency exchanges are problematic because of it having features of bay’ al-kali’ bil-kali (the sale of one debt for another).

This study is one of few studies that highlight the shari’ah issues of Islamic derivatives in Islamic banking and finance industry. This paper is of value in discussing risk management and Islamic derivatives in Islamic financial institutions and how there are many issues under the investigation process, particularly issues related to controversial underlying contracts and products.

The failings of the new experiment launched in the Soviet Union between 1985‐1990 under the formula of glasnost and perestroika, are outlined and explained. As an alternative, one which if successful may lead to an “economic miracle” even greater than that of the recovery of Germany and Japan after the Second World War, a programme for recovery and stabilisation of the Soviet economy and finances is formulated. There is a need for critical evaluation of both capitalism and socialism to correct their weaknesses by introducing a new social economic order – “liberal socialism”, if you use the terminology in the East; “social liberalism” in the West. This can be achieved only if certain conditions are met (conditions of equilibrium: monetary, banking, organised markets, and competition). Wide‐ranging reforms are advocated, including the passing of a Law of Social and Economic Justice in the privatisation of industry, artisanship and commerce; reforms of organised securities, commodities and foreign exchange markets; the establishment of the Federal Central Bank of the Soviet Union; agrarian reforms; and new legislation in communications, public administration and international balance of payments. The ultimate goal of the plan is the realisation of a social economy of free, just and stable markets.

Drawing upon underinvestment theory and clientele effect hypothesis, this paper aims to examine the effects of foreign currency (forex) exposure and Shari’ah-compliant status on firms’ financial hedging strategy.

Based on data of 250 nonfinancial firms listed on Bursa Malaysia from 2010 to 2018 (2,250 firm-year observations), the authors test the impact of forex exposure based on a vector of foreign-denominated cash flows (FCF) indicators and firms’ Sharīʿah-compliant status on two proxies of financial hedging decisions, namely, the ratio of the notional value of currency derivatives to total assets and a binomial measure of hedging status. The hedging decision models are estimated using panel logistic regression and system generalized method of moments.

The results indicate significant positive effects of the forex exposure indicators on firms’ propensity to hedge. However, the impact of forex exposure is most prevalent via total FCF. The results also reveal significant positive effects of Sharīʿah-compliant status on firms’ propensity to hedge but its negative impacts on the value of currency derivatives they use. The results suggest that Sharīʿah-compliant firms refrain from engaging in currency derivatives to avoid riba’ and subsequently subdue the clientele effect. However, when the forex exposure reaches higher levels, engagement in currency derivatives becomes a matter of tentative necessity (dharurat).

This study relies exclusively on the disclosure of foreign currency risk and management data in the annual reports of listed companies. Consequently, this limits the sample size to only those nonfinancial listed companies with complete data for the study period. Also, since none of the companies reports using Sharīʿah-compliant derivatives, the authors thus assume that they use derivative instruments that tolerate “riba.”

Given the significance of forex exposure on hedging decisions, the accounting profession must strictly adopt FRS 7 and FRS 139 for all listed firms to avoid market scrutiny and sustain their clientele. The results also call for the Islamic market regulators to include mandatory disclosure of conventional currency derivatives in screening firms for clearly prohibited activities to help enhance the credibility of its Islamic financial market.

Due to difficulty accessing relevant cash flow data, the study is among the few studies that measure forex exposure using FCF and test more proxy indicators. This study is perhaps the first to examine the Shari’ah perspective on currency derivatives in corporate forex risk management.

This study aims to analyze the competition of two financial chains (FCs) when the government intervenes in the financial market to prohibit the excessively high-interest rate by minimizing the arbitrages caused by speculative transactions. Each FC comprises an investor and one intermediary, attempts to finance the capital-constrained firms in financing needs.

Using a Stackelberg game theoretic framework and formulating two- and three-level optimization problems for six possible scenarios, the authors establish an integrative framework to evaluate the scenarios through the lens of the two main decision-making structures of the FCs (i.e. centralized and decentralized) and three policies of the government (i.e. speculation minimizing, revenue gaining and utility maximizing).

Solving the problem results in optimal values for tariffs, which guarantee a stable competitive market. Consequently, policymaking by the government influences the decision variables, which is shown in a numerical study. The authors find that the government can orchestrate the FCs in the competitive market by imposing tariffs and prohibiting high-interest rates via regulating the speculation impacts, which guarantees a stable market and facilitates the financing of capital-constrained firms.

This paper aids the financial markets and governments to control the interest rate by minimizing the speculation level.

This paper investigates the impact of government intervention policies – as a leading player – on the competition of FCs – as followers – in providing financial services and making profits. The government imposes tariffs on the interest rate to stabilize the market by limiting speculative transactions. The paper presents the mathematical models of the optimization problems through the game-theoretic framework and comparison of the scenarios through a numerical experiment.

The author examines the presence of foreign currency effects and the risk-mitigation channel through which a foreign-currency denomination reduces the loan spread.

The author runs regression analyses using loan data of firms incorporated in member countries of the Association of Southeast Asian Nations (ASEAN) from 2000 to 2020. The author also runs several robustness tests to address forward exchange rate bias, endogeneity concern and sample-selection bias.

Consistent with the currency matching motive of foreign debt use, the results show that a foreign currency denomination is associated with a lower spread and the relationship is amplified when there is a positive correlation between the changes in the return on assets and in the exchange rate.

This paper enriches existing studies on the use of foreign debt as an exchange rate risk management tool.

The results suggest that as firms utilize foreign debt and policymakers need to design banking regulations that not only oversee but also encourage the use of foreign debt as a hedging instrument to lower firms' borrowing costs.

This paper contributes to extant studies by examining the presence of foreign currency effects in emerging countries' loan markets and by exploiting the micro-level demand-side factors as the channel through which the currency denomination affects the loan spread.

The functioning of the international monetary system as institutionalised under the Articles of Agreement of the International Monetary Fund after World War II began to deteriorate after 1957. By that date many European countries had sufficiently recovered or improved their competitive positions in world markets to enable them to replenish their external reserves and make their currencies convertible. Up to that point their acquisitions of gold and US dollars must be viewed as a healthy redistribution of international reserves, But thereafter dollar surpluses replaced the alleged dollar shortages of earlier years on international markets. Recurring runs on the dollar appeared, vying with the periodic runs on sterling as threats to the stability of the system.