Saturday, April 2

Gold Dinar for Islamic Countries

The Dinar has long since has had exotic and evocative images, starting from piles of dinar’s in the pots in Alladin’s cave to the very fact that its gold. Anyway, one Malaysian state has gone and launched the Gold Dinar and Silver Dirham as its currency, apparently in a bid to be more Arab than the Arabs. Besides the fact that the actual Arabs think these wannabe Arabs are clowns and look down upon them, but when you wrap these things in religion, then everything is all right, its a one large happy family and and and. So what are the chances that the OIC suddenly goes into a collective huddle and decides that all countries will suddenly adopt the Dinar and Dirham. Well, ummm, no, not according to this research.

I quote the research highlights:

► This study suggests the lack of broad linkages within the entire OIC. ► Given OIC’s diversity, the idea of a Gold Dinar for the entire OIC may be stillborn. ► There exists scope among some smaller clusters for potential monetary union. ► Bahrain/ Saudi, Qatar/ Kuwait of the GCC states show symmetrical supply shocks. ► Bahrain, Qatar, Saudi, UAE have same response of GDP and prices to supply shocks.

Give it some more time, guys, then it could potentially work. But the areas concerned are just too different. Still, the OIC has its work cut out for it if it wants to evolve this monetary system. Although why on earth would anybody take anything that the OIC says seriously is beyond me, that organisation is about as useful as a bladeless knife with no handle.

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