Friday, September 14, 2012


When my wife and I sold our house in Winnipeg, we looked into buying a new house here in Victoria. After looking around, we decided against it. Why? Simple, really: math. The general rule is that the cost of a house should be about 15 years worth of comparable rent. If the cost is lower, say around 12 years, then the house is supposed to be a very good price. Here in Victoria it seemed to me that the average price was about 22 years worth of rent. In other words, the houses are vastly overpriced right now. And given the fact that my wife is a musician in the military, and we can stay in the military housing for quite a bit lower rent, buying just wasn't a good option at the time.

But this led us to another question altogether: What do we do with the money we received from our sale of the house?

Payment of the applicable Right of God and contributions to the Fund aside, we were still left with a sizable chunk of change. How, we wondered, should we use it?

The first thing we did was put some of it towards my artwork, allowing me to buy materials that I could not have afforded otherwise. This has allowed me to expand my work, and make a decent living with it at the same time. Nice, that.

Then we put some money in with Investor's Group. Now, however, we are re-thinking that last decision.


Well, I'm glad you asked, dear Reader.

Marielle and I have been talking a lot about the current global situation, as well as the effect that the money markets have on the planet. One thing that caught our attention was the injunction in Islam forbidding the charging of interest on a loan. In the Qur'an, verse 2:275, it says "But Allah has permitted trade and has forbidden interest."

Baha'u'llah has rescinded this in the following passage, but the very concept still has me thinking:

As to thy question concerning interest and profit on gold and silver: Some years ago the following passage was revealed from the heaven of the All-Merciful in honour of the one who beareth the name of God, entitled Zaynu'l-Muqarrabin -- upon him be the glory of the Most Glorious. He -- exalted be His Word -- saith: Many people stand in need of this. Because if there were no prospect for gaining interest, the affairs of men would suffer collapse or dislocation. One can seldom find a person who would manifest such consideration towards his fellow-man, his countryman or towards his own brother and would show such tender solicitude for him as to be well-disposed to grant him a loan on benevolent terms. (Such loans as bear no interest and are repayable whenever the borrower pleases.) Therefore as a token of favour towards men We have prescribed that interest on money should be treated like other business transactions that are current amongst men. Thus, now that this lucid commandment hath descended from the heaven of the Will of God, it is lawful and proper to charge interest on money, that the people of the world may, in a spirit of amity and fellowship and with joy and gladness, devotedly engage themselves in magnifying the Name of Him Who is the Well-Beloved of all mankind. Verily He ordaineth according to His Own choosing. He hath now made interest on money lawful, even as He had made it unlawful in the past. Within His grasp He holdeth the kingdom of authority. He doeth and ordaineth. He is in truth the Ordainer, the All-Knowing.

My first question is why was it a problem in the first place? What is the result of charging interest? And even though Baha'u'llah has said that it is now lawful, should we still approach it with caution?

Here are my thoughts, which, of course, are nothing official, but they do guide my own direction with investing.

First of all, I think we can look at Wall Street as the extreme form of this process. I do not think it is the norm in regards to the investing of money, although that format has developed to be most popular. (Which I guess makes it the norm in terms of dollar amounts, but I don't think most of the people in the world would think of using their money in this manner.) The sole concern with Wall Street, I think it is safe to say, is the making of a profit. This, unfortunately, often comes at the expense of things like individuals, the environment, moral behaviour, and so forth. And while I do not think there is anything wrong with wanting to make a profit, "Whatsoever passeth beyond the limits of moderation", Baha'u'llah says, "will cease to exert a beneficial influence."

This, to my untrained eye, is the source of many of the problems that are facing the world at this time. There are just too many people whose sole concern is making money for themselves, and they do not appear to see the dangers of this.

The second thing about Wall Street is that they, as a formless entity, produce nothing. They do not create anything tangible. All they do is move money around, which in itself is an intangible thing, and then charge a percentage fee to do so. If anything, they assist the businesses that they help to be more effective in producing things like business plans, which in turn help them be more efficient.

Either way, I still think they charge too much money for doing virtually nothing.

But what can I do? Baha'u'llah says that it is ok to invest our money, but I do not feel comfortable placing my money at the disposal of those who do demonstrate a concern for the welfare of the planet.

Simple. (And I really like simple answers.)

I can invest locally.

How? I am so glad you asked, dear Reader.

There are many options for this. One of them is to loan money through a micro-loan organization, and there are many of these around now. While the payback rate is quite high, though, you don't always get to see the impact of your investment.

For me, I prefer, and will be looking into, making loans in my own community. There are plenty of farmers who could use the assistance, and in return I would not only get my money back at some point in the future, but I would also get some of the crops as an extra payment. This, to me, would be my profit: food.

I can also invest in local artists, or artisans.

To do this, I am looking at the Wall Street model for guidance, without their underlying principles. I will be asking the artist to show me their portfolio, as well as business statements. I want them to show me that they know what they are doing, capable business people, and proficient artists. In other words, they should be able to demonstrate to me that they will use the money wisely.

And what would I like in return? Well, that depends. Sometimes a bit of a profit on the money, over a few years time, or else perhaps a work of art in addition to the money back. In other words, I don't want to just buy a work of art. I have enough of that already. Instead, I want to be able to help them develop and grow in their field, as I have been able to do in mine.

There is also the possibility of helping someone with start-up costs in a non-artistic business, but this is more theoretical for me. I mean, I am an artist after all, so my natural inclination is to support the arts.

Anyways, I have to go and sell my own work today, so I have to leave it here, but I wanted to share a few of these thoughts that have been going through my mind. I would dearly love to hear feedback on this, and any suggestions for wise investing that you may have.


  1. I've never really had much extra money to invest because I've been trying to payoff my student loan since I graduated in mid 90's, it was only when I lived with Iris that I was able to afford to make significant payments on the principle of my loans and started for the first time to put a few dollars towards RRSPs and mutual funds through Investers Group. Not much really but it's nice to have a rain day fund or money in case of emergencies. I'm glad I did invested in Investors Group. I'm not a finacial consultant but in the turbulant waters of finacial investment I like to think of my consultant as a wise old fisherman; he gets up each morning at the crack of dawn and casts his investment nets upon the seas of free market economy and at the end of the day is able to bring in meat for the dinner table not just for himself but also my family as well. I help provide money for his boat and nets and he shares with me some of the fish he catches. Corny, I know but it helps me sleep at nights. And in case your intrested. I have seen the movie a Perfect Storm and politics aside it was a great film. I think any movie that can keep me intrested that doesn't have car chases, explosions or nudity has to be doing something right.

  2. When I came into some money recently, I was faced by the same dilemma, and was guided by this quote (found at the beginning of the prayer for the Fund):

    "All the friends of God ... should contribute to the extent possible, however modest their offering may be. God doth not burden a soul beyond its capacity. Such contributions must come from all centers and all believers. ... O Friends of God! Be ye assured that in place of these contributions, your agriculture, your industry, and your commerce will be blessed by manifold increases, with goodly gifts and bestowals. He who cometh with one goodly deed will receive a tenfold reward. There is no doubt that the living Lord will abundantly confirm those who expend their wealth in His path." ('Abdu'l-Baha, Baha'i Prayers, p. 83)

    I looked at this "tenfold reward" as if it was 10% interest; and when I looked at the return on investment with all traditional sources, I couldn't find a better rate anywhere! So I invested my money in the "bank of God" (the Baha'i Fund).