Ordinary government bonds or government bonds are also called a bond issued by the government of a country denominated in that country. Government bonds denominated in foreign currencies are commonly called international bonds (sovereign bonds).
Risk
Ordinary government bonds is also called the "risk-free bonds" because the government of a country can raise taxes or print money to pay off the bonds from the payment at maturity. Indeed there are records where the government bonds has failed to pay as happened in Russia in 1998 the government called Russia's financial crisis, although this is very rare to happen.
For example, in U.S. government bonds, called "Treasury securities" is denominated in U.S. dollars and an investment in the U.S. dollar risk-free. In this case is the 'risk free "is meant safe from credit risk. But still there are other risks such as exchange rate risk for foreign investors in which the value of U.S. dollar is weakening against currencies of other countries. It is also against the risk of inflation which at maturity bond redemption values obtained by weakening the purchasing power of investors due to inlasi greater than the yield obtained. Many governments issue inflation indexed bonds that protect investors against inflation risk.
Government bonds can also be risky if issued by the government of a country whose country has the capability of financial policy which is less good. Let's say that Bulgaria has a dependency on the world economy and world economic institutions than other countries such as America. Some state bonds was rated on a scale of A-after 2004. In February February 2006 Standard & Poor's assigned a rating of the long-term debt terjadap Bulgaria in its domestic currency at BBB + scale. And this ranking is as the result of decades of decreased risk (and an increase in ratings).
Issuance of bonds
Government bonds issued by an institution that became part of the finance department of a country, for example:
Bund are bonds issued by the German Financial Institutions, denominated in euro
Gilts are bonds issued by the UK Debt Management Office (UK Debt Management Office) denominated in sterling
U.S. Treasuries are bonds issued by the Bureau of the Public Debt (Bureau of Public Debt)
Government bonds
Some types of government bonds
Asia
Japan
Rating: AA-/A2 Published by: the Ministry of Finance (MoF)
Japanese Government Bonds (JGBs)
Revenue Bonds / Straight Bonds
Financing Bills
Subsidy Bonds
Subscription Bonds
Contribution Bonds
Demand Bonds (Kofu Kokusai)
Indonesia
Rating: B + / Bb Published by: Directorate General of Treasury Department of Finance of the Republic of Indonesia
Government Securities (SUN)
Treasury Bills (NES) the maximum term of 12 months with interest payments sisitim discount.
State Bonds; above 12-month period
Without the coupon: the interest payment is implicitly reflected in the difference between the price at the time of issue and received a nominal value at maturity
With coupon: interest payments are calculated by a certain percentage of par value and paid on a regular basis
Fixed interest
Floating Flower
Bonds denominated in foreign currencies
Bonds of the Republic of Indonesia (ORI) is a retail bond sale to public investors at par value per share of Rp. 1 million
Europe
France
Rating: AAA / Aaa Published by: Agence France Tresor, the French Institute of debt [6]
Oats
BTFs - bills
BTANs - IOU a period up to 6 years
Assimilables obligations du Tresor (Oats) -
TEC10 Oats - rate bonds based on the yield index OAT 10-year maturity period
OATi - French inflation indexed bonds
OAT € i - Eurozone inflation indexed bonds
German
Rating: AAA / Aaa Published by: Finanzagentur GmbH, a German financial institution [7]
Bunds
Bubill - bills
Bundesschatzanweisungen (Schätze) - 2-year bond
Bundesobligationen (Bobls) - 5-year bond Bundesanleihen ** (Bunds), - bonds
Italy
Rating of A + / AA2 Published by: Dipartimento del Tesoro [8]
BTPs
Ordinari Buoni del Tesoro o (bots) - term debt securities up to one year
Certificati o del Tesoro Zero Coupon (CTZ) - term debt securities up to 2 years
Buoni del Tesoro o Poliannuali (BTPs) - bonds
Credito del Tesoro Certificati at (CCTs) - floating rate debt securities
BTP Indicizzato all'Inflazione - inflation bonds
English
Rating: AAA / Aaa Published by: UK Debt Management Office [9]
Gilts
Conventional Gilts
Gilts indices
Gilts due date twin
Gilts with no due date
Gilt Strips
America
Rating: AAA / Aaa Published by: Bureau of the Public Debt [10]
U.S. Treasuries
Treasury bill
Treasury note
Treasury bond
TIPS
Savings bond
Wednesday, June 30, 2010
Tuesday, June 29, 2010
STOCK FUTURES
Futures exchange was the place / facility for a number of contracts traded memperjual commodity or financial instrument at a specified price which the goods delivery will be made at the time agreed to come. The contract is binding at the time the agreement between the buyer and seller. There is no secondary market for trading in futures contracts. All contracts are the primary contract and every contract (with the subject of a particular contract) incurred (opened) must be registered on the local stock exchange authorities, so the contract was created in the stock.
The history of futures exchanges
Although the practice of futures trading has been going on since the days of yore at the time of the ancient Greeks or Phoenicians, but the history of modern futures trading began in the early 18th century America in Chicago. Chicago is located near the lake Great Lakes, is a center of transportation, distribution and trading of agricultural products because of the location adjacent to the center of Chicago's agriculture and animal husbandry from the western U.S. Midwest
An abundance of crops and lack of supply continues to cause price fluctuations in the market. This has encouraged the formation of a market that allows traders commodity grain (grain), the users of raw materials (such as factories, etc.), companies engaged in agro-business (eg for export) to conduct a transaction "future" or "payment in front of" or known by the term delivery contracts (forward contracts) to protect them against the risk of adverse price change and enable the hedging (hedge). This transfer contract which soon grows into futures contracts (futures contract)
At the time the contract was still a very simple transfer. However, many contracts are not adhered to hand over either by the buyer or the seller. For example, if a buyer contracts to deliver corn has pledged to buy corn at a time agreed upon in the future but at the time of delivery arrived corn price was lower than the contract price then the buyer denies handing over the contract, and vice versa. Transfer contract market is very illiquid and needed an exchange (where possible of the transaction between the counterparty does not need to know the opponent) to facilitate transactions between buyers or sellers of a commodity.
In 1848, the Chicago Board of Trade (CBOT), established a first futures exchange in the world. Trade is still in the form of contract delivery and on March 13, 1851 made the first delivery contract for commodity corn. In the year 1865 introduced the standardization of contract delivery.
Chicago Produce Exchange was established in 1874, later in the year 1898 was renamed the Chicago Mercantile Exchange (CME). In 1972 formed a division of the CME which is named "the International Monetary Market" (International Monetary Market-IMM), with the aim to offer a contract in the form of transfer of foreign currency that is: pounds sterling, Canadian dollar, German mark, Japanese yen, Mexican pesos , and Swiss franc.
In the year 1881 in the Midwestern United States, a regional market that is established in the city of Minneapolis, Minnesota and in 1883 diperkenalkanlah futures trading for the first time and since then continuously trade today and the Minneapolis Grain Exchange (MGEX) is a the only option and futures market for hard red spring wheat types.
Later in the 1970s developed the financial futures contracts which can be traded value of future interest rates. In Eurodollar contract introduced in 1981 (in particular Eurodollar futures contract 90 days) which has a major influence on the development of interest rate swap market.
New York Mercantile Exchange (NYMEX) is the trading of commodity futures exchanges and major physical trading forum for energy and metals products, with the amount of daily trading transactions in May 2007 reached 1,754,442, or 143,864,215 transactions annually.
In 2006, the New York Stock Exchange together with the London Exchanges "Euronext" carry trade futures electronically to form a trading stock futures and options of the first transcontinental.
Differences in futures and stock markets
Futures trading contracts are not issued as the issuance of stock but "formed" when there is the buyer (called the long term) and there is the buyer (called a short) The buyer and seller of the contract creates a new contract each time they reach an agreement. If it were not for closing the previous long position, would the sellers will be short. Short and long are always in pairs, where there are parties who have a long position, there must be a short party. in the stock market, a limited number of securities terdaftaradalah. The seller, unless the issuer, the stock can not create it, because the seller must have a capital market or borrow securities before allowed to sell it. While on futures exchanges, the buyer and seller contract creates a new contract each time they reach an agreement. If it were not for closing the previous long position, would the sellers will be short. Short and long are always in pairs, where there are parties who have a long position, there must be a short party.
In the futures market, investors may realize losses or profits, whether buying or selling time, when the purchase or sale transaction was closed position. Neither buyers nor sellers may not realize the loss or gain on the purchase or sale if it continues to open position. While in the capital market, sellers should not be short. Investors in the stock market will only be possible to realize losses or profits on selling time shares owned. The possibility of profit there is only the seller, while buyers will only realize losses or profits at the time of sale.
Capital market that happens is the physical trade in which the sale and purchase of shares carried out physically, so there is physically handed over shares worth of liability to pay 100% of the transaction, while the traded futures trading is a contract / promise or agreement to deliver or receive an item certain in the future. As a seller or buyer in the futures market are required to submit a number of funds is only about 50-10% of the value of commodities that were traded as a good faith (good faith) called the margin.
Derivatives Clearing
On each contract listed and is an open contract, the Clearing will calculate profits and losses on these contracts based on the settlement price set by the Exchange.
Usually there is a body responsible for ensuring completion mengkliringkan and futures contracts / derivatives / Spot and contract delivery regularly, fairly and efficiently so as to maintain market integrity.
When the stock exchange and derivatives such as CBOE LIFEE responsible for providing a means to create efficiency, transparency and orderliness, the completion of the transactions carried out by the Clearing Corporation (clearing firms) or commonly called the Clearing Houses.
Another example in Indonesia, P.T. Jakarta Futures Exchange as the steering and charge exchange futures trading, but the clearing and settlement of transactions conducted by the Indonesian Derivatives Clearing House
Settlement of transactions
On futures transactions to be done, there are four ways that are usually carried out to settle a transaction is being done to close the position, namely:
1. Settlement of transactions in a liquidation.
2. Settlement of transactions in a physical exchange deposits.
3. Settlement of transactions in derivative assets of physical delivery.
4. Settlement of transactions in cash.
Guarantor futures transactions
Derivative contract is a contract that has a level of price volatility is very high, sometimes more volatile than the benchmark asset (underlying asset) and this can make one party suffered huge losses that can not complete the transaction. At a safe trading conditions which the parties engaged in transactions requiring a certainty that the counter would meet its obligations in market conditions which, however, without exception. This requirement can make a complicated arrangement in procedures such as taksasi credit transactions, establishing transaction limits, and other settings for each principal transaction, and this will make the futures trading loses its appeal.
To avoid the mentioned above, the clearing institution shall perform the function of a novation or substitution for the transaction of futures / derivatives that are registered by the clearing member buyer and seller, where the clearing house would ensure the rights and obligations for each member lliring buyers and sellers will guarantee the rights and obligations of the seller to every clearing member buyer.
Clearing agencies in carrying out its function as guarantor institutions and risk management implemented a number of ways in managing the risks it faces, namely:
• Guidance and supervision of the financial condition of clearing members.
• Harvesting and management of margins
• Daily price adjustments
• Separation of funds clearing members in a separate account.
• The clearing fund.
• Reduction of default.
Margin on futures transactions
Margins levied by the clearing house
Clearing agencies in carrying out its role as the implementing agency and the pledging of the clearing member futures transactions will be wearing two kinds of margins, namely:
Initial margin or commonly called the initial margin or margin deposit is also a special fund reserved for the closing
losses which may arise because of margin trading during the expiration of margin trading.
Margin Mark-To-Market Where at the end of each trading day clearing agency will reassess each existing open positions with adjusting to the price of settlement that occurred at the end of the trading day (the "mark to market"), and as a result of the assessment process anniversary, there will arise the advantages and disadvantages, called variation margin margin and clearing institution will automatically debit the account of clearing members experience a lack of margin accounts and crediting the clearing members who have excess margin.
The margin collected by brokers trading futures
The margin collected by brokers trading futures is called "margin customers" is a fund that is on a broker as collateral for open contracts where funding / guarantees should be greater than the initial margin deposited by the broker clearing members on the clearing house.
Institutions that regulate futures trading
Futures trading is governed by an institution which is a stand-alone institutions (independent) and usually referred to as "self-regulatory organizations" or SRO. Regulator which regulates futures trading futures trading in several countries, among others:
In Australia, this role is undertaken by the Australian Securities and Investments Commission (ASIC)
In China by the China Securities Regulatory Commission (CSRC)
In Hong Kong, by the Securities and Futures Commission (SFC)
In India, by the Securities and Exchange Board of India (SEBI)
In Singapore by the Monetary Authority of Singapore (MAS)
In the UK, by the Financial Services Authority (FSA)
In America, by the Commodity Futures Trading Commission (CFTC)
In Indonesia, by the Commodity Futures Trading Supervisory Agency (BAPPEBTI).
In France, the French Commission des Operations de Bourse (COB)
In Germany, by Bundesaufsichtsamt Fur der Wertpapierhandel (bawe)
In Ireland, by the Central Bank of Ireland (CBI)
In Italy, by the Commissione Nazionale per le Societa e He Borsa (CONSOB)
In the Netherlands, by the Securities Board of the Netherlands (STE)
In Quebec, the Commission des Valeurs Mobilieres du Quebec (CVMQ)
In South Africa, by the Financial Services Board of South Africa (FSB)
In Spain, by Comision Nacional del Mercado de Valores (CNMV).
In Malaysia, the Commodities Trading Commission to trade commodity futures and by the Securities Commission to trade in currency futures.
The history of futures exchanges
Although the practice of futures trading has been going on since the days of yore at the time of the ancient Greeks or Phoenicians, but the history of modern futures trading began in the early 18th century America in Chicago. Chicago is located near the lake Great Lakes, is a center of transportation, distribution and trading of agricultural products because of the location adjacent to the center of Chicago's agriculture and animal husbandry from the western U.S. Midwest
An abundance of crops and lack of supply continues to cause price fluctuations in the market. This has encouraged the formation of a market that allows traders commodity grain (grain), the users of raw materials (such as factories, etc.), companies engaged in agro-business (eg for export) to conduct a transaction "future" or "payment in front of" or known by the term delivery contracts (forward contracts) to protect them against the risk of adverse price change and enable the hedging (hedge). This transfer contract which soon grows into futures contracts (futures contract)
At the time the contract was still a very simple transfer. However, many contracts are not adhered to hand over either by the buyer or the seller. For example, if a buyer contracts to deliver corn has pledged to buy corn at a time agreed upon in the future but at the time of delivery arrived corn price was lower than the contract price then the buyer denies handing over the contract, and vice versa. Transfer contract market is very illiquid and needed an exchange (where possible of the transaction between the counterparty does not need to know the opponent) to facilitate transactions between buyers or sellers of a commodity.
In 1848, the Chicago Board of Trade (CBOT), established a first futures exchange in the world. Trade is still in the form of contract delivery and on March 13, 1851 made the first delivery contract for commodity corn. In the year 1865 introduced the standardization of contract delivery.
Chicago Produce Exchange was established in 1874, later in the year 1898 was renamed the Chicago Mercantile Exchange (CME). In 1972 formed a division of the CME which is named "the International Monetary Market" (International Monetary Market-IMM), with the aim to offer a contract in the form of transfer of foreign currency that is: pounds sterling, Canadian dollar, German mark, Japanese yen, Mexican pesos , and Swiss franc.
In the year 1881 in the Midwestern United States, a regional market that is established in the city of Minneapolis, Minnesota and in 1883 diperkenalkanlah futures trading for the first time and since then continuously trade today and the Minneapolis Grain Exchange (MGEX) is a the only option and futures market for hard red spring wheat types.
Later in the 1970s developed the financial futures contracts which can be traded value of future interest rates. In Eurodollar contract introduced in 1981 (in particular Eurodollar futures contract 90 days) which has a major influence on the development of interest rate swap market.
New York Mercantile Exchange (NYMEX) is the trading of commodity futures exchanges and major physical trading forum for energy and metals products, with the amount of daily trading transactions in May 2007 reached 1,754,442, or 143,864,215 transactions annually.
In 2006, the New York Stock Exchange together with the London Exchanges "Euronext" carry trade futures electronically to form a trading stock futures and options of the first transcontinental.
Differences in futures and stock markets
Futures trading contracts are not issued as the issuance of stock but "formed" when there is the buyer (called the long term) and there is the buyer (called a short) The buyer and seller of the contract creates a new contract each time they reach an agreement. If it were not for closing the previous long position, would the sellers will be short. Short and long are always in pairs, where there are parties who have a long position, there must be a short party. in the stock market, a limited number of securities terdaftaradalah. The seller, unless the issuer, the stock can not create it, because the seller must have a capital market or borrow securities before allowed to sell it. While on futures exchanges, the buyer and seller contract creates a new contract each time they reach an agreement. If it were not for closing the previous long position, would the sellers will be short. Short and long are always in pairs, where there are parties who have a long position, there must be a short party.
In the futures market, investors may realize losses or profits, whether buying or selling time, when the purchase or sale transaction was closed position. Neither buyers nor sellers may not realize the loss or gain on the purchase or sale if it continues to open position. While in the capital market, sellers should not be short. Investors in the stock market will only be possible to realize losses or profits on selling time shares owned. The possibility of profit there is only the seller, while buyers will only realize losses or profits at the time of sale.
Capital market that happens is the physical trade in which the sale and purchase of shares carried out physically, so there is physically handed over shares worth of liability to pay 100% of the transaction, while the traded futures trading is a contract / promise or agreement to deliver or receive an item certain in the future. As a seller or buyer in the futures market are required to submit a number of funds is only about 50-10% of the value of commodities that were traded as a good faith (good faith) called the margin.
Derivatives Clearing
On each contract listed and is an open contract, the Clearing will calculate profits and losses on these contracts based on the settlement price set by the Exchange.
Usually there is a body responsible for ensuring completion mengkliringkan and futures contracts / derivatives / Spot and contract delivery regularly, fairly and efficiently so as to maintain market integrity.
When the stock exchange and derivatives such as CBOE LIFEE responsible for providing a means to create efficiency, transparency and orderliness, the completion of the transactions carried out by the Clearing Corporation (clearing firms) or commonly called the Clearing Houses.
Another example in Indonesia, P.T. Jakarta Futures Exchange as the steering and charge exchange futures trading, but the clearing and settlement of transactions conducted by the Indonesian Derivatives Clearing House
Settlement of transactions
On futures transactions to be done, there are four ways that are usually carried out to settle a transaction is being done to close the position, namely:
1. Settlement of transactions in a liquidation.
2. Settlement of transactions in a physical exchange deposits.
3. Settlement of transactions in derivative assets of physical delivery.
4. Settlement of transactions in cash.
Guarantor futures transactions
Derivative contract is a contract that has a level of price volatility is very high, sometimes more volatile than the benchmark asset (underlying asset) and this can make one party suffered huge losses that can not complete the transaction. At a safe trading conditions which the parties engaged in transactions requiring a certainty that the counter would meet its obligations in market conditions which, however, without exception. This requirement can make a complicated arrangement in procedures such as taksasi credit transactions, establishing transaction limits, and other settings for each principal transaction, and this will make the futures trading loses its appeal.
To avoid the mentioned above, the clearing institution shall perform the function of a novation or substitution for the transaction of futures / derivatives that are registered by the clearing member buyer and seller, where the clearing house would ensure the rights and obligations for each member lliring buyers and sellers will guarantee the rights and obligations of the seller to every clearing member buyer.
Clearing agencies in carrying out its function as guarantor institutions and risk management implemented a number of ways in managing the risks it faces, namely:
• Guidance and supervision of the financial condition of clearing members.
• Harvesting and management of margins
• Daily price adjustments
• Separation of funds clearing members in a separate account.
• The clearing fund.
• Reduction of default.
Margin on futures transactions
Margins levied by the clearing house
Clearing agencies in carrying out its role as the implementing agency and the pledging of the clearing member futures transactions will be wearing two kinds of margins, namely:
Initial margin or commonly called the initial margin or margin deposit is also a special fund reserved for the closing
losses which may arise because of margin trading during the expiration of margin trading.
Margin Mark-To-Market Where at the end of each trading day clearing agency will reassess each existing open positions with adjusting to the price of settlement that occurred at the end of the trading day (the "mark to market"), and as a result of the assessment process anniversary, there will arise the advantages and disadvantages, called variation margin margin and clearing institution will automatically debit the account of clearing members experience a lack of margin accounts and crediting the clearing members who have excess margin.
The margin collected by brokers trading futures
The margin collected by brokers trading futures is called "margin customers" is a fund that is on a broker as collateral for open contracts where funding / guarantees should be greater than the initial margin deposited by the broker clearing members on the clearing house.
Institutions that regulate futures trading
Futures trading is governed by an institution which is a stand-alone institutions (independent) and usually referred to as "self-regulatory organizations" or SRO. Regulator which regulates futures trading futures trading in several countries, among others:
In Australia, this role is undertaken by the Australian Securities and Investments Commission (ASIC)
In China by the China Securities Regulatory Commission (CSRC)
In Hong Kong, by the Securities and Futures Commission (SFC)
In India, by the Securities and Exchange Board of India (SEBI)
In Singapore by the Monetary Authority of Singapore (MAS)
In the UK, by the Financial Services Authority (FSA)
In America, by the Commodity Futures Trading Commission (CFTC)
In Indonesia, by the Commodity Futures Trading Supervisory Agency (BAPPEBTI).
In France, the French Commission des Operations de Bourse (COB)
In Germany, by Bundesaufsichtsamt Fur der Wertpapierhandel (bawe)
In Ireland, by the Central Bank of Ireland (CBI)
In Italy, by the Commissione Nazionale per le Societa e He Borsa (CONSOB)
In the Netherlands, by the Securities Board of the Netherlands (STE)
In Quebec, the Commission des Valeurs Mobilieres du Quebec (CVMQ)
In South Africa, by the Financial Services Board of South Africa (FSB)
In Spain, by Comision Nacional del Mercado de Valores (CNMV).
In Malaysia, the Commodities Trading Commission to trade commodity futures and by the Securities Commission to trade in currency futures.
Monday, June 28, 2010
COMMODITIES
Commodities can be defined as follows:
Something real object which is relatively easily traded, can be delivered physically, can be stored for a certain period and can be exchanged with other products with the same type, which usually can be purchased or sold by investors through the stock futures and More generally, a product of trading, including foreign exchange, financial instruments and indices.
Characteristics of the commodity that is the price is determined by supply and demand rather than determined by the distributor or seller and the price is based on the calculation of the price of each perpetrator Commodity examples are (but are not limited to): mineral and agricultural products such as iron ore, oil, ethanol , sugar, coffee, aluminum, rice, wheat, gold, diamonds or silver, but there is also a product called "commoditized" (no longer differentiated based on brand) as a computer
In linguistics, the word "commodity" is becoming known and used in England in the 15th century from the French language that is "commodité" meaning "something good" in quality and service.
The Latin root is called commoditas which refers to different ways of measuring the right of things, circumstances or the condition of the right time, good quality, ability to produce something or property; and value-added or profit.
In Germany called Die Ware, such as products or goods offered for sale.
In France called "produit de base" like energy, goods, or industrial raw materials.
In Indonesia can be interpreted as: merchandise, trade objects, or raw materials which can be classified according to their quality in accordance with international trade standards, such as wheat, rubber, coffee.
Commodity Trading
The risk in trading commodities, other than the failed promises, caused by price fluctuations. Price is determined by demand and supply in commodity markets. Demand is determined by the growth of population, the number of use, new uses and because of the substitution. Offers beribah due to the capacity of production (land area planted or built a new factory), season, weather good or bad, or the incentive of government restrictions, natural disasters or in war or peace. So many unpredictable factors. This has encouraged the emergence of the need for hedging. Needs will be fulfilled with the creation of hedging contracts on Bursa IN OUTSIDE going on. At first, the need for hedging is only felt in the trade of agricultural commodities, but the longer the need is felt for all sorts of commodities, including commodity finance, weather, economy, banking dlsbnya. To all that made the contract. Some of the contracts were traded on the stock that already called the Commodity Exchange, even though we have called the Exchange Contracts.
Dibursa trade commodity contracts carried out (contract) commodities in various countries such as in:
London Commodity Exchange which is now called Euronext LIFFE
New York Board of Trade (NYBOT)
Chicago Board of Trade, now merged with the CME
Winnipeg Commodity Exchange
London Metal Exchange
Chicago Mercantile Exchange
Multi Commodity Exchange of India
Jakarta Futures Exchange (JFX-Jakarta Futures Exchange)
Commodity Exchange
Commodity exchange is a meeting place between demand and supply of commodities and derivatives. The seller and the buyer of the goods in stock to meet these commodities. In addition to buyers and sellers, some brokers are known by the commissioner and the broker. The Commissioner took the position itself, while the broker can not hold a position.
Commodities are generally transacted is coffee, cocoa, sugar, soybeans, corn, gold, copper, cotton, pepper, wheat, and CPO (crude palm oil, crude palm oil), cotton, dairy, metal (gold, silver, nickel) and also uses commodity futures contracts as a benchmark asset. These futures contracts include spot prices, contract delivery, futures contracts and futures options or interest rates, environmental instruments, swaps, derivative contracts or transportation.
Commodity Trading
Commodity exchanges usually trade futures contracts on commodities. A farmer who plants corn can sell a new corn futures contract will dipanennya few months later and get a guaranteed price that will be received when the goods will be delivered after the harvest, and a producer of cereals and snacks to buy the contract today and get a guarantee that the price will not be rising at the time the goods delivered later. This would protect farmers from falling prices and also protect the buyer from price rises.
Speculators also make the purchase and sale of futures contracts to profit and provide liquidity to the futures trading system.
Commodity exchanges around the world (data is constantly changing every year)
Commodity exchanges throughout the world, among others:
Exchange
Australian Securities Exchange
Brazilian Mercantile and Futures Exchange
Bursa Malaysia
Central Japan Commodity Exchange
Chicago Board of Trade
Chicago Climate Exchange
Chicago Mercantile Exchange
Dalian Commodity Exchange
Dubai Mercantile Exchange
Dubai Gold & Commodities Exchange
Euronext
European Climate Exchange
HedgeStreet Exchange
Intercontinental Exchange
Kansai Commodities Exchange
Kansas City Board of Trade
London Metal Exchange
Memphis Cotton Exchange
Minneapolis Grain Exchange
Multi Commodity Exchange
National Commodity Exchange Limited
National Commodity and Derivatives Exchange
New York Board of Trade
New York Mercantile Exchange
Risk Management Exchange
Shanghai Futures Exchange
Singapore Commodity Exchange
Tokyo Commodity Exchange
U.S. Futures Exchange
Tokyo Grain Exchange
Winnipeg Commodity Exchange
Zhengzhou Commodity Exchange
The value of the commodity code
Futures exchanges to determine a minimum value where the price of commodities can be moved up or down. Minimum fluctuation is known as the "code" or "tick" or commodity tick. Each futures contract has a different size, quantity, valuation, etc., so any "code size" as used in the futures contract is very dependent on these variables. This size is very important because they reflect the possible rates available.
List of codes
Product futures contract size and value of E-Mini S & P 500 Index 0,25 $ 50 * $ 12.50 CME E-Mini Nasdaq Composite Index $ 20 * 0,50 $ 10.00 Australian Dollar A $ 100 000 * 0,0001 $ 10.00 British Pound £ 62,500 * 0,0001 CME Canadian Dollar $ 6.25 C $ 100,000 * $ 10.00 0,0001 CME Euro FX € 125,000 * 0,0001 $ 12.50 Japanese Yen 12,500,000 JPY * $ 12.50 Mexican Peso 0,000001 500 000 MP * 0, 000025 $ 12.50 NZ100.000 * New Zealand Dollar Swiss Franc 0,0001 $ 10.00 125,000 * 0.0001 $ 12.50 30 days FED Fund $ 5,000,000 * 0,005 $ 20.835 5 Year Treasury Note $ 100,000 * 1 / 64 $ 15.625 2 Year Treasury Note $ 200,000 * 1 / 128 $ 15.625 30 Year Treasury Bond $ 100,000 * 1 / 32 $ 31.25 Gold CBOT CBOT 100 oz * $ 0.10 / ounce $ 10.00 CBOT CBOT Silver 5000 ounce * $ 0.001 / oz $ 5.00 Silver New York E Mini-Ons 0.000 * $ 0.001 / ounce $ 1.00 500 Barrels of crude miNY * $ 0.025 $ 12.50 miNY Natural Gas 5000 BTU * $ 0.005 $ 25.00
Commodity Futures Trading Supervisory Board
Commodity Futures Trading Supervisory Board, abbreviated Bappebti, an echelon I units of the Ministry of Trade Republic of Indonesia, which is tasked with the development, regulation and supervision of trading activities of futures and physical markets and services. Bappebti head since March 2005
THIS INFORMATION FOR YOUR’S
Something real object which is relatively easily traded, can be delivered physically, can be stored for a certain period and can be exchanged with other products with the same type, which usually can be purchased or sold by investors through the stock futures and More generally, a product of trading, including foreign exchange, financial instruments and indices.
Characteristics of the commodity that is the price is determined by supply and demand rather than determined by the distributor or seller and the price is based on the calculation of the price of each perpetrator Commodity examples are (but are not limited to): mineral and agricultural products such as iron ore, oil, ethanol , sugar, coffee, aluminum, rice, wheat, gold, diamonds or silver, but there is also a product called "commoditized" (no longer differentiated based on brand) as a computer
In linguistics, the word "commodity" is becoming known and used in England in the 15th century from the French language that is "commodité" meaning "something good" in quality and service.
The Latin root is called commoditas which refers to different ways of measuring the right of things, circumstances or the condition of the right time, good quality, ability to produce something or property; and value-added or profit.
In Germany called Die Ware, such as products or goods offered for sale.
In France called "produit de base" like energy, goods, or industrial raw materials.
In Indonesia can be interpreted as: merchandise, trade objects, or raw materials which can be classified according to their quality in accordance with international trade standards, such as wheat, rubber, coffee.
Commodity Trading
The risk in trading commodities, other than the failed promises, caused by price fluctuations. Price is determined by demand and supply in commodity markets. Demand is determined by the growth of population, the number of use, new uses and because of the substitution. Offers beribah due to the capacity of production (land area planted or built a new factory), season, weather good or bad, or the incentive of government restrictions, natural disasters or in war or peace. So many unpredictable factors. This has encouraged the emergence of the need for hedging. Needs will be fulfilled with the creation of hedging contracts on Bursa IN OUTSIDE going on. At first, the need for hedging is only felt in the trade of agricultural commodities, but the longer the need is felt for all sorts of commodities, including commodity finance, weather, economy, banking dlsbnya. To all that made the contract. Some of the contracts were traded on the stock that already called the Commodity Exchange, even though we have called the Exchange Contracts.
Dibursa trade commodity contracts carried out (contract) commodities in various countries such as in:
London Commodity Exchange which is now called Euronext LIFFE
New York Board of Trade (NYBOT)
Chicago Board of Trade, now merged with the CME
Winnipeg Commodity Exchange
London Metal Exchange
Chicago Mercantile Exchange
Multi Commodity Exchange of India
Jakarta Futures Exchange (JFX-Jakarta Futures Exchange)
Commodity Exchange
Commodity exchange is a meeting place between demand and supply of commodities and derivatives. The seller and the buyer of the goods in stock to meet these commodities. In addition to buyers and sellers, some brokers are known by the commissioner and the broker. The Commissioner took the position itself, while the broker can not hold a position.
Commodities are generally transacted is coffee, cocoa, sugar, soybeans, corn, gold, copper, cotton, pepper, wheat, and CPO (crude palm oil, crude palm oil), cotton, dairy, metal (gold, silver, nickel) and also uses commodity futures contracts as a benchmark asset. These futures contracts include spot prices, contract delivery, futures contracts and futures options or interest rates, environmental instruments, swaps, derivative contracts or transportation.
Commodity Trading
Commodity exchanges usually trade futures contracts on commodities. A farmer who plants corn can sell a new corn futures contract will dipanennya few months later and get a guaranteed price that will be received when the goods will be delivered after the harvest, and a producer of cereals and snacks to buy the contract today and get a guarantee that the price will not be rising at the time the goods delivered later. This would protect farmers from falling prices and also protect the buyer from price rises.
Speculators also make the purchase and sale of futures contracts to profit and provide liquidity to the futures trading system.
Commodity exchanges around the world (data is constantly changing every year)
Commodity exchanges throughout the world, among others:
Exchange
Australian Securities Exchange
Brazilian Mercantile and Futures Exchange
Bursa Malaysia
Central Japan Commodity Exchange
Chicago Board of Trade
Chicago Climate Exchange
Chicago Mercantile Exchange
Dalian Commodity Exchange
Dubai Mercantile Exchange
Dubai Gold & Commodities Exchange
Euronext
European Climate Exchange
HedgeStreet Exchange
Intercontinental Exchange
Kansai Commodities Exchange
Kansas City Board of Trade
London Metal Exchange
Memphis Cotton Exchange
Minneapolis Grain Exchange
Multi Commodity Exchange
National Commodity Exchange Limited
National Commodity and Derivatives Exchange
New York Board of Trade
New York Mercantile Exchange
Risk Management Exchange
Shanghai Futures Exchange
Singapore Commodity Exchange
Tokyo Commodity Exchange
U.S. Futures Exchange
Tokyo Grain Exchange
Winnipeg Commodity Exchange
Zhengzhou Commodity Exchange
The value of the commodity code
Futures exchanges to determine a minimum value where the price of commodities can be moved up or down. Minimum fluctuation is known as the "code" or "tick" or commodity tick. Each futures contract has a different size, quantity, valuation, etc., so any "code size" as used in the futures contract is very dependent on these variables. This size is very important because they reflect the possible rates available.
List of codes
Product futures contract size and value of E-Mini S & P 500 Index 0,25 $ 50 * $ 12.50 CME E-Mini Nasdaq Composite Index $ 20 * 0,50 $ 10.00 Australian Dollar A $ 100 000 * 0,0001 $ 10.00 British Pound £ 62,500 * 0,0001 CME Canadian Dollar $ 6.25 C $ 100,000 * $ 10.00 0,0001 CME Euro FX € 125,000 * 0,0001 $ 12.50 Japanese Yen 12,500,000 JPY * $ 12.50 Mexican Peso 0,000001 500 000 MP * 0, 000025 $ 12.50 NZ100.000 * New Zealand Dollar Swiss Franc 0,0001 $ 10.00 125,000 * 0.0001 $ 12.50 30 days FED Fund $ 5,000,000 * 0,005 $ 20.835 5 Year Treasury Note $ 100,000 * 1 / 64 $ 15.625 2 Year Treasury Note $ 200,000 * 1 / 128 $ 15.625 30 Year Treasury Bond $ 100,000 * 1 / 32 $ 31.25 Gold CBOT CBOT 100 oz * $ 0.10 / ounce $ 10.00 CBOT CBOT Silver 5000 ounce * $ 0.001 / oz $ 5.00 Silver New York E Mini-Ons 0.000 * $ 0.001 / ounce $ 1.00 500 Barrels of crude miNY * $ 0.025 $ 12.50 miNY Natural Gas 5000 BTU * $ 0.005 $ 25.00
Commodity Futures Trading Supervisory Board
Commodity Futures Trading Supervisory Board, abbreviated Bappebti, an echelon I units of the Ministry of Trade Republic of Indonesia, which is tasked with the development, regulation and supervision of trading activities of futures and physical markets and services. Bappebti head since March 2005
THIS INFORMATION FOR YOUR’S
Sunday, June 27, 2010
INVESTMENT MANAGEMENT
Investment management is the management professionals who manage a variety of securities or securities such as stocks, bonds and other assets such as property with a view to achieving a favorable investment target for investors. Investors may be institutions (insurance companies, pension funds, companies etc) or may also be the individual investors, where the medium used is usually in the form of investment contract or a contract is generally used is a form of collective investment (KIK), such as mutual funds.
Scope of investment management services include financial analysis, asset selection, stock selection, implementation planning and monitoring of investments.
Outside the financial industry, the terminology "refers to the investment management of other investments other than financial investment in such projects, brands, patents and many others other than stocks and bonds.
Investment management is a huge global industry and plays an important role in the management of trillions of dollars, euros, pounds and yen.
Investment management industry
The operations of these investment management consists of various areas, including hiring professional investment managers, research and trading functions order (dealing), the completion of the transaction, marketing, internal audit, and preparing reports for clients.
Management of the investment management industry involve very many parties that show how the complex needs of this industry. In addition to marketing employees who bring clients to come to this industry, there is the compliance staff (to ensure compliance with all applicable regulations by the company), internal auditors (internal system for auditing and internal oversight), the department of finance (to record its financial transactions) , computer experts and other support staff (to record every transaction and financial valuation of thousands of corporate customers)
Role as an agent
Investment management firms often act as an agent or broker of their shareholders and the company rather than directly owns shares of the company. Theoretically, the owners of the shares have enormous power to change the direction of its corporate policy through the voting rights of shareholders in general meeting (AGM) and its ability to control and reduce corporate management. However, in practice, the owners of these shares does not use voting rights which are owned collectively (because the ownership of each consists of only small amounts), and financial institutions (as agents) sometimes using the voting rights. Has become a common belief that investment management as an agent must have the ability to actively monitor the performance of companies whose shares are owned by their customers.
Operational Constraints
Some constraints in the investment management business operates, among others:
gross income derived directly related to the valuation of market value so that the fall in market value of assets will result in a drastic decrease in gross profit relative to the cost.
difficulty of maintaining the performance of investment management so as to achieve an above-average value and the customer usually indicates lack of patience when bad investment performance.
salary of a successful investment manager is very expensive and has the possibility of hijacked by a competitor.
investment performance is above average is highly dependent on the uniqueness of the expertise of investment managers, but the customer never care about such things and simply just look at the success of companies that are considered based on the philosophy and internal discipline
analysts who have the ability to generate above-average profits often have an established financial condition so that they will refuse offers of employment offered by the company to manage its own portfolio.
Investment companies in the world who might be most successful are those who separate from the banking and insurance, both physically and psychologically, where the best performance and dynamic business strategy that is most commonly produced by an independent investment management firm.
Funds managed by global investment management
Global investment management industry assets increased rapidly and in 2006 reached a record 55 trillion dollars, an increase of 10% from the previous year and increased by 55% if calculated since 2002.
Total pension fund assets reach 20.6 trillion dollars in the year 2005 in which 16.6 trillion invested in insurance and 17.8 trillion in mutual funds. Merrill Lynch assess the value of individual investments reached 33.3 trillion, which placed third in other forms of conventional investment management.
In 2005, 48% of total global investment funds come from the USA and Japan is the next position with the amount of 11% and England by 7%. Asia-Pacific region showed strong growth in recent years. Countries such as China and India offer huge potential and many companies are increasing their attention on this region.
10 large investment management firm
Top 10 asset managers in the year 2005 according to Global Investor Magazine based on assets under management. (Source: BGI)
Companies ranked in kelolannya Funds
(U.S. $ million) Country 1. Barclays Global Investors 1,400,491 UK 2. State Street Global Advisors 1,367,269 U.S. 3. U.S. 1,299,400 4 Fidelity Investments. Capital Group Companies 1,050,435 U.S. 5. Legg Mason U.S. 891.400 6. The Vanguard Group 852 000 U.S. 7. Allianz Global Investors Germany 790.513 8. JPMorgan Asset Management U.S. 782.646 9. Mellon Financial Corporation 738.294 U.S. 10. Deutsche Asset Management Germany 723.366
Pensions & Investments magazine put UBS in the first rank, with more than two trillion dollars of funds under management
Structure portolio
Business focuses on investment management industry is the manager on duty to invest and divest client investments. Investment advisors from a certified investment management company should manage its clients investments in accordance with the needs and risk profile of each customer, whereby financial advisers will recommend an appropriate form of investment for these customers.
Asset allocation
Various asset classes include bonds, property, derivatives and commodities, where the investment manager paid placement services to carry out investments in various asset this. Various asset classes has a market dynamics vary and influence each other, so the placement of investment funds in various asset is able to bring significant influence on investment performance.
Long-term Investments
It is important to consider the evidence yields on long-term performance of assets in different investment and to make investments in that period in order to get the best investment results. For example in a long period of time (eg above 10 years) in some countries, stocks produce higher returns than bonds, and bonds lebihy give higher returns than holding cash. According to financial theory this is caused by a greater risk on the stock (more volatile) than bonds are more risky than cash.
Diversification
Fund managers to pay attention to the background of the asset allocation, will consider diversifying the risk profile of assets based on its customers and make a list of suitable investment placement planning. The list will show the percentage of placement of funds in each stock or bond. The theory of portfolio diversification was introduced by Harry Max Markowitz and effectiveness of diversification requires management of the correlation between returns and capital returns, issues internal to the relevant portfolio, cross correlation between the rate of return.
Methods investment approach
Many different methods of how to approach the investment management that can be done by an investment management company, such as growth (growth), value (value fund), market neutral, small capitalization, the index and others. These different methods each have features, adherents, certain financial environment, the nature of the specific risks vary.
Scope of investment management services include financial analysis, asset selection, stock selection, implementation planning and monitoring of investments.
Outside the financial industry, the terminology "refers to the investment management of other investments other than financial investment in such projects, brands, patents and many others other than stocks and bonds.
Investment management is a huge global industry and plays an important role in the management of trillions of dollars, euros, pounds and yen.
Investment management industry
The operations of these investment management consists of various areas, including hiring professional investment managers, research and trading functions order (dealing), the completion of the transaction, marketing, internal audit, and preparing reports for clients.
Management of the investment management industry involve very many parties that show how the complex needs of this industry. In addition to marketing employees who bring clients to come to this industry, there is the compliance staff (to ensure compliance with all applicable regulations by the company), internal auditors (internal system for auditing and internal oversight), the department of finance (to record its financial transactions) , computer experts and other support staff (to record every transaction and financial valuation of thousands of corporate customers)
Role as an agent
Investment management firms often act as an agent or broker of their shareholders and the company rather than directly owns shares of the company. Theoretically, the owners of the shares have enormous power to change the direction of its corporate policy through the voting rights of shareholders in general meeting (AGM) and its ability to control and reduce corporate management. However, in practice, the owners of these shares does not use voting rights which are owned collectively (because the ownership of each consists of only small amounts), and financial institutions (as agents) sometimes using the voting rights. Has become a common belief that investment management as an agent must have the ability to actively monitor the performance of companies whose shares are owned by their customers.
Operational Constraints
Some constraints in the investment management business operates, among others:
gross income derived directly related to the valuation of market value so that the fall in market value of assets will result in a drastic decrease in gross profit relative to the cost.
difficulty of maintaining the performance of investment management so as to achieve an above-average value and the customer usually indicates lack of patience when bad investment performance.
salary of a successful investment manager is very expensive and has the possibility of hijacked by a competitor.
investment performance is above average is highly dependent on the uniqueness of the expertise of investment managers, but the customer never care about such things and simply just look at the success of companies that are considered based on the philosophy and internal discipline
analysts who have the ability to generate above-average profits often have an established financial condition so that they will refuse offers of employment offered by the company to manage its own portfolio.
Investment companies in the world who might be most successful are those who separate from the banking and insurance, both physically and psychologically, where the best performance and dynamic business strategy that is most commonly produced by an independent investment management firm.
Funds managed by global investment management
Global investment management industry assets increased rapidly and in 2006 reached a record 55 trillion dollars, an increase of 10% from the previous year and increased by 55% if calculated since 2002.
Total pension fund assets reach 20.6 trillion dollars in the year 2005 in which 16.6 trillion invested in insurance and 17.8 trillion in mutual funds. Merrill Lynch assess the value of individual investments reached 33.3 trillion, which placed third in other forms of conventional investment management.
In 2005, 48% of total global investment funds come from the USA and Japan is the next position with the amount of 11% and England by 7%. Asia-Pacific region showed strong growth in recent years. Countries such as China and India offer huge potential and many companies are increasing their attention on this region.
10 large investment management firm
Top 10 asset managers in the year 2005 according to Global Investor Magazine based on assets under management. (Source: BGI)
Companies ranked in kelolannya Funds
(U.S. $ million) Country 1. Barclays Global Investors 1,400,491 UK 2. State Street Global Advisors 1,367,269 U.S. 3. U.S. 1,299,400 4 Fidelity Investments. Capital Group Companies 1,050,435 U.S. 5. Legg Mason U.S. 891.400 6. The Vanguard Group 852 000 U.S. 7. Allianz Global Investors Germany 790.513 8. JPMorgan Asset Management U.S. 782.646 9. Mellon Financial Corporation 738.294 U.S. 10. Deutsche Asset Management Germany 723.366
Pensions & Investments magazine put UBS in the first rank, with more than two trillion dollars of funds under management
Structure portolio
Business focuses on investment management industry is the manager on duty to invest and divest client investments. Investment advisors from a certified investment management company should manage its clients investments in accordance with the needs and risk profile of each customer, whereby financial advisers will recommend an appropriate form of investment for these customers.
Asset allocation
Various asset classes include bonds, property, derivatives and commodities, where the investment manager paid placement services to carry out investments in various asset this. Various asset classes has a market dynamics vary and influence each other, so the placement of investment funds in various asset is able to bring significant influence on investment performance.
Long-term Investments
It is important to consider the evidence yields on long-term performance of assets in different investment and to make investments in that period in order to get the best investment results. For example in a long period of time (eg above 10 years) in some countries, stocks produce higher returns than bonds, and bonds lebihy give higher returns than holding cash. According to financial theory this is caused by a greater risk on the stock (more volatile) than bonds are more risky than cash.
Diversification
Fund managers to pay attention to the background of the asset allocation, will consider diversifying the risk profile of assets based on its customers and make a list of suitable investment placement planning. The list will show the percentage of placement of funds in each stock or bond. The theory of portfolio diversification was introduced by Harry Max Markowitz and effectiveness of diversification requires management of the correlation between returns and capital returns, issues internal to the relevant portfolio, cross correlation between the rate of return.
Methods investment approach
Many different methods of how to approach the investment management that can be done by an investment management company, such as growth (growth), value (value fund), market neutral, small capitalization, the index and others. These different methods each have features, adherents, certain financial environment, the nature of the specific risks vary.
Saturday, June 26, 2010
DERIVATIVES
In the world of finance (finance), a derivative is a bilateral contract or payment exchange agreement whose value is derived, or derived from the product being "basic reference" or also called a "derivative product" (underlying product), rather than trade or exchange the physical asset, market participants make a mutual agreement to exchange money, assets or a value sector in future by referring to the assets that became the principal reference.
Derivatives are used by management investment / portfolio management, corporate and financial institutions and individual investors to manage their positions against the risk of the stock and commodity price movements, interest rate, foreign exchange rates "without" affecting the physical position of the reference product (underlying ).
There are lots of financial instruments which can be categorized in groups of derivatives but the options / futures contracts and swaps are commonly known.
Option is a contract whereby one party agreed to pay compensation to the other party to a "right" (but not the obligation) to buy something or sell something to another party, such as only someone who worry that the price of the stock will fall XXX before he could sell it, he will pay a reward to another person (this is called a "seller" option / put option), which agreed to buy the stock at a price determined therefrom in front of the (strike price). Buyers use this option to manage the risk of falling value of the sale of stock XXX has, on the other side of the buyer the option might be to use the transaction option to receive fees and may already have a picture that XXX is not the sale value will go down.
As an opponent of the sale option is usually called call option or call option where the option was granted an option to the option buyer the right to buy the underlying asset (underlying asset) at a date agreed with the price of a predetermined or known as the strike option
Swap
Swap is a foreign term whose meaning is "exchange" but the term is also used in Indonesia in general
Swap agreements are two foreign exchange transactions through the purchase or sale of cash (spot) with the sale / repurchase is a term that carried out simultaneously with the same bank and at the level of premium or discount and exchange rates made and agreed on the date of the transaction.
Derivatives can refer to the various types of assets such as commodities, stocks or bonds, interest rates, currency exchange rates or indexes (such as stock market index, consumer price index (CPI-Consumer Price Index [), or even weather conditions or a derivative index others). Views from the assets referred to can set a price or time of payment.
The main usefulness of these derivatives is to transfer the risk or taking a risk depending on whether its position as Hedger (actor hedge) or a speculator. Diverse range of underlying asset value and produce a variety of payment alternatives derivative contracts traded on the market. The main types of derivatives are futures contracts (futures) contracts and transfer (forward), options and swaps.
Uses of derivatives
Insurance and hedging
One of the usefulness of derivatives is as a tool to transfer risk. For example, farmers can sell futures contracts to the speculators on the crop before harvest. The farmer to hedge the risk of increase or decrease the price of crops and the speculators accept this risk transfer in the hope of big returns. Sipetani know exactly the value of selling the crop to be obtained later and the speculators will get a profit if the selling price has increased but if the sales price has decreased and he will suffer losses.
Speculation and arbitrage
Arbitration or also known as foreign "arbitrage" can be interpreted as an act of taking advantage by exploiting the difference between an underlying asset and other assets such as reference by using the difference between the value of LQ-45 (ILQ-45) in Jakarta Stock Exchange (spot market) and the value KBIE ILQ-45 at the Surabaya Stock Exchange (futures market), so in addition to taking a position on the SSE, also must take a position on the JSE so that simultaneously taking opposite positions between the JSX and SSX.
Speculators may trade with other speculators as well as people who need hedging (Hedger). In general, the market transactions of derivatives markets are dominated by speculative trading than hedging trade in a very real sense.
Type of derivative contract
There are two types of derivative contracts that are recognized by the way of trade in the market, namely:
Derivatives exchanges outside also known by the term "(Over-the-counter (OTC) derivatives) is a bilateral contract (involving two parties) are carried out outside the stock exchange or without using a broker (direct transactions between the parties). Some products such as swaps, contracts and transfer exchange rate, and exotic options (exotic options), a derivative that uses features which will be more complex than commonly traded derivatives, such as vanilla options) are often traded without going through the stock exchange (OTC).
Derivatives markets without going through the stock exchange (OTC) is very big.
Derivatives traded on exchanges
or also called Exchange-traded derivatives are derivative instruments that are traded on stock specific trading derivatives (futures) or other exchanges. Stock derivatives carrying out its role as an intermediary in the transaction and collect the related initial margin (initial margin) from both parties who enter into transactions as collateral.
Examples of derivative
Economic derivatives: the value is paid based on economic data as statistics issued by a State agency
Derivative of energy: the value is paid based on a variety of energy price index, normally classified physically or financially, where physical reality is an agreement which is the physical delivery of commodities to be derivative of the energy (petroleum, gas, electricity, etc.)
Commodity
freight derivatives
inflation derivatives
insurance derivatives
weather derivatives
Credit derivatives
sports derivatives
Property derivatives
Derivatives are used by management investment / portfolio management, corporate and financial institutions and individual investors to manage their positions against the risk of the stock and commodity price movements, interest rate, foreign exchange rates "without" affecting the physical position of the reference product (underlying ).
There are lots of financial instruments which can be categorized in groups of derivatives but the options / futures contracts and swaps are commonly known.
Option is a contract whereby one party agreed to pay compensation to the other party to a "right" (but not the obligation) to buy something or sell something to another party, such as only someone who worry that the price of the stock will fall XXX before he could sell it, he will pay a reward to another person (this is called a "seller" option / put option), which agreed to buy the stock at a price determined therefrom in front of the (strike price). Buyers use this option to manage the risk of falling value of the sale of stock XXX has, on the other side of the buyer the option might be to use the transaction option to receive fees and may already have a picture that XXX is not the sale value will go down.
As an opponent of the sale option is usually called call option or call option where the option was granted an option to the option buyer the right to buy the underlying asset (underlying asset) at a date agreed with the price of a predetermined or known as the strike option
Swap
Swap is a foreign term whose meaning is "exchange" but the term is also used in Indonesia in general
Swap agreements are two foreign exchange transactions through the purchase or sale of cash (spot) with the sale / repurchase is a term that carried out simultaneously with the same bank and at the level of premium or discount and exchange rates made and agreed on the date of the transaction.
Derivatives can refer to the various types of assets such as commodities, stocks or bonds, interest rates, currency exchange rates or indexes (such as stock market index, consumer price index (CPI-Consumer Price Index [), or even weather conditions or a derivative index others). Views from the assets referred to can set a price or time of payment.
The main usefulness of these derivatives is to transfer the risk or taking a risk depending on whether its position as Hedger (actor hedge) or a speculator. Diverse range of underlying asset value and produce a variety of payment alternatives derivative contracts traded on the market. The main types of derivatives are futures contracts (futures) contracts and transfer (forward), options and swaps.
Uses of derivatives
Insurance and hedging
One of the usefulness of derivatives is as a tool to transfer risk. For example, farmers can sell futures contracts to the speculators on the crop before harvest. The farmer to hedge the risk of increase or decrease the price of crops and the speculators accept this risk transfer in the hope of big returns. Sipetani know exactly the value of selling the crop to be obtained later and the speculators will get a profit if the selling price has increased but if the sales price has decreased and he will suffer losses.
Speculation and arbitrage
Arbitration or also known as foreign "arbitrage" can be interpreted as an act of taking advantage by exploiting the difference between an underlying asset and other assets such as reference by using the difference between the value of LQ-45 (ILQ-45) in Jakarta Stock Exchange (spot market) and the value KBIE ILQ-45 at the Surabaya Stock Exchange (futures market), so in addition to taking a position on the SSE, also must take a position on the JSE so that simultaneously taking opposite positions between the JSX and SSX.
Speculators may trade with other speculators as well as people who need hedging (Hedger). In general, the market transactions of derivatives markets are dominated by speculative trading than hedging trade in a very real sense.
Type of derivative contract
There are two types of derivative contracts that are recognized by the way of trade in the market, namely:
Derivatives exchanges outside also known by the term "(Over-the-counter (OTC) derivatives) is a bilateral contract (involving two parties) are carried out outside the stock exchange or without using a broker (direct transactions between the parties). Some products such as swaps, contracts and transfer exchange rate, and exotic options (exotic options), a derivative that uses features which will be more complex than commonly traded derivatives, such as vanilla options) are often traded without going through the stock exchange (OTC).
Derivatives markets without going through the stock exchange (OTC) is very big.
Derivatives traded on exchanges
or also called Exchange-traded derivatives are derivative instruments that are traded on stock specific trading derivatives (futures) or other exchanges. Stock derivatives carrying out its role as an intermediary in the transaction and collect the related initial margin (initial margin) from both parties who enter into transactions as collateral.
Examples of derivative
Economic derivatives: the value is paid based on economic data as statistics issued by a State agency
Derivative of energy: the value is paid based on a variety of energy price index, normally classified physically or financially, where physical reality is an agreement which is the physical delivery of commodities to be derivative of the energy (petroleum, gas, electricity, etc.)
Commodity
freight derivatives
inflation derivatives
insurance derivatives
weather derivatives
Credit derivatives
sports derivatives
Property derivatives
Friday, June 25, 2010
BANKING
The Bank is a financial intermediary institutions are generally established with the authority to accept deposits, lend money, and issue promissory notes or what is known as banknote.Kata derived from the Italian bank Banca means the exchange. While according to the Law of the Republic of Indonesia Number 10 Year 1998 On November 10, 1998 on banking, which is the bank is a business entity which collects funds from the public in the form of savings and channel them to the public in the form of loans or other forms in order to improve many social welfare
The banking industry has undergone major changes in recent years. This industry has become more competitive because of deregulation of the rules. Currently, banks have flexibility in the services they offer, the location where they operate, and the rates they pay depositors for deposits.
Understanding
According to Law Decree No. 10 Year 1998 on 10 November 1998 on the banks, it can be concluded that the banking business includes three activities, namely raise funds, distribute funds, and provides services to other banks. Events raise and distribute funds while the bank was successively principal activity provides services to other banks only support activities. Activities to collect funds, such as collecting funds from the public in the form of demand deposits, savings and time deposits. Usually he is given an attractive fringe benefits such as, flowers and gifts as a stimulus for the community. Activities to collect funds, in the form of lending to the public. Whereas in other banking services provided to support these primary activities. bank was founded by Prof.. Dr. Ali Afifuddin, SE In my opinion, the bank is a tool that facilitates the activities of the community to save money, in terms of commerce, or for future investment. The banking world is one institution that plays an important role in the economy of a country (particularly in the field of financing the economy). Here are some of the benefits of banking in the life:
As an investment model, which means that derivative transactions can be used as one model of investing. Although in general is kind of short-term investments (yield enhancement).
As a way of hedging, which means that derivative transactions can serve as one way to eliminate risk by hedging (hedging), or also known as risk management.
Price information, which means that derivative transactions can serve as a means of seeking or providing information about a specific commodity prices in the future (price discovery).
Speculative function, which means that derivative transactions can provide opportunities speculation (speculative) of market value changes of derivative transactions itself. 5. Production management functions carried out smoothly and efficiently, which means that derivative transactions can provide images to a manufacturer of production management in assessing a market demand and needs in the future. Apart from Functions-banking functions (bank) primary or derivatives, then one should pay attention to the banking world, is a philosophical purpose of the existence of banks in Indonesia. This is very clearly reflected in Article four (4) of Law Number 10 Year 1998 which explains, "Bank Indonesia aims to support the implementation of national development in order to improve equity, economic growth, national stability and prosperity toward the improvement of the people." Deeper review of the business activities of banks, the banks (banking) of Indonesia in carrying out its business should be based on the principle of economic democracy, which use the principle of hatian.4 This, clearly illustrated, because philosophically the bank has a function of macro and micro in the process of nation building .
Banking History
The Bank was first established in the form of such a firm is generally in the year 1690, when the British monarch willing to plan to rebuild naval power to compete with the French naval forces but the British government when it does not have the financial capability and then based on the idea that later William Paterson by Charles Montagu realized by forming a financial intermediary institutions that can eventually meet the financing fund in just twelve days.
History records the origin of banking activities is known at the time of a past empire in mainland Europe. Then the banking business has grown to West Asia by the merchants. The development of banking in Asia, Africa and America brought by Europeans during the colonial to country towns do well in Asia, Africa and the Americas. When traced, the history of banking familiar starting from the currency exchange service. Thus, in banking history, meaning the bank is known as a table where the currency exchange. In the course of the history of the kingdom in the first exchange between the kingdom of the money made one other royal circuitry. This exchange activity is now known as Foreign Exchange Dealer (Money Changer). Then in the next development, developing the banking operations into the care of money or so-called current deposit activity. Next banking activities increased with moneylending activities. The money saved by society, by banks lent back to the society needs it. Services of other banks followed in accordance with the development of the age and needs of an increasingly diverse society
History of Banking in Indonesia
Indonesia's banking history is inseparable from the Dutch East Indies colonial period. At that time De Javasche Bank, NV was founded in Batavia on January 24, 1828 and then followed Escompto Nederlandsche Indische Maatschappij, NV in 1918 as the holder of the monopoly purchase of agricultural products in domestic and overseas sales [and there are some banks that play an important role in Dutch East Indies. Existing banks were among others:
1. De Javasce NV.
2. De Post Poar Bank.
3. Hulp en Spaar Bank.
4. De Algemenevolks Crediet Bank.
5. Nederland handles Maatscappi (NHM).
6. Handles Nationale Bank (NHB).
7. De Escompto Bank NV.
8. Nederlansche Indische Handelsbank
In addition, there are also owned banks Indonesian people and foreigners such as from China, Japan, and Europe. These banks include:
1. NV. Nederlandsch Indische Spaar En Bank Deposit
2. National Bank Indonesia.
3. Merchant's Bank of gray.
4. Boemi Bank NV.
5. The Chartered Bank of India, Australia and China
6. Hongkong & Shanghai Banking Corporation
7. The Yokohama Species Bank.
8. The Matsui Bank.
9. The Bank of China.
10. Bank Batavia.
At the time of independence, Indonesia's banking stepped forward and grow again. Some Dutch bank dinasionalisir by the Indonesian government. The banks in the early days of independence, among others:
NV. Nederlandsch Indische Spaar En Deposit Bank (currently Bank OCBCNISP), founded 4 April 1941 with headquarters in Bandung
Bank Negara Indonesia, which was established on July 5, 1946, now known as BNI '46.
Bank Rakyat Indonesia, which was established on February 22, 1946. This bank was derived from De Algemenevolks Crediet Ginko Bank or Syomin.
Bank of Surakarta Airlines Adil Makmur (MAI) in 1945 in Solo.
Bank Indonesia in Palembang in 1946.
Bank Dagang Nasional Indonesia in 1946 in Medan.
Indonesian Banking Corporation in 1947 in Yogyakarta, later became Bank of Amrita.
Bank NV in Manado in Sulawesi in 1946.
Indonesian Trade Bank NV in Samarinda in 1950 and then merged with Bank of the Pacific.
East Bank NV in Semarang changed its name to Bank Gemari. Subsequently merged with Bank Central Asia (BCA) in 1949.
In Indonesia, the practice has spread to banking to remote rural areas. Form of bank financial institutions in Indonesia in the form of Commercial Banks, Rural Banks (BPR), Commercial Bank of Sharia, as well as BPR Syariah (BPRS). Each bank institutions is a different shape characteristics and functions
Government Banks
Through Decree No. 1/M/61 dated January 6, 1961 which prohibits the announcement and publication of monetary statistics and banking, then between the years 1960 to 1965, Bank Indonesia does not publish annual reports, including statistical data on the central clearing and calculation.
On July 5, 1964, on the basis of political considerations to simplify the command in the banking sector to support the Universal Development Planning, then in 1965 the government established a policy to integrate all the state banks into one bank under the name Bank Negara Indonesia, the initiative is the integration of government bank comes from the idea Jusuf Muda Dalam, who was then serving as Minister of the Central Bank / Governor of Bank Indonesia - the newly appointed President Director of BNI original position - and approved by President Sukarno. The basic idea is to make banking as a tool of revolution with the motto of the Bank under the leadership struggle in the Great Leader of the Revolution. Name of Bank Negara Indonesia (BNI) as a single bank, proposed by Joseph Young in itself. The result was the birth of this new structure makes the struggling bank;
Bank Indonesia to Bank Negara Indonesia Unit I,
Farmers and Fishermen Cooperative Bank and the Bank of Eczema Indonesia became Bank Negara Indonesia Unit II;
Bank Negara Indonesia to Bank Negara Indonesia Unit III;
State Commercial Bank became Bank Negara Indonesia Unit IV and
State Savings Bank became Bank Negara Indonesia Unit V.
But not all government bank successfully integrated into the struggling bank Bank Dagang Negara (BDN) and Bapindo. BDN Luputnya of this integration process, especially because President Director BDN JD Massie when it served as Minister of Reform of the National Private Banks which would have had enough clout to object to the pooling of BDN with other banks. Massie argues that this policy will confuse overseas correspondent banks for the settlement of L / C, export and import for the name of the same bank. Meanwhile, Bapindo not integrated into the Bank Fought because this bank under the Development Council chaired by the First Minister of Development Affairs with members of the Finance Minister, who is also Chairman of the Supervisory Board Bapindo, and Governor of Bank Indonesia as a member. Thus, through his position, the effect is strong enough to deter Bapindo integrated into the BNI.
Private Bank
In 1965 the government wants to mengabungkan all private banks or foreign banks in Private Development Bank as the sole collector and dealer banks of all progressive funds in the private sector and tools that can be used Universal Development Plan and other plans specified by the President of the Republic of Indonesia.
History of Government Banks
As is well known that the Indonesian banking world knew of the former penjajahnya, namely the Netherlands. Therefore, history is not free from the influence perbankanpun country menjajahnya for both government banks and private banks. In 1958, the government nationalized the Dutch-owned bank began with Handelsbank Nationale (NHB) in 1959 which subsequently changed to the State Commercial Banks (BUNEG later became Bank Bumi Daya), then in 1960 consecutive Escomptobank to Bank Dagang Negara (BDN) and Nederlandsche Handelsmaatschappij (NHM) to Farmers and Fishermen Cooperative Bank (BKTN) and then became the Export Import Bank of Indonesia (BEII).
The following will briefly described the history of government-owned banks, namely:
Central Bank
Central Bank of Indonesia is Bank Indonesia (BI) based on Law No. 13 Year 1968. Then asserted again circuitry Law No. 23 Year 1999.Bank was previously derived from De Javasche Bank in nasionalkan in the year 1951.
Bank Rakyat Indonesia and Bank Export Import
This bank was derived from De Algemene Volkscrediet Bank, then in the melting after a single bank under the name National Bank Indonesia (BNI), Unit II, which is engaged in rural and export import (exim), separated into:
In charge of rural to Bank Rakyat Indonesia and Law No. 21 Year 1968.
In charge of Exim with the Law No. 22 Year 1968 became Export Import Bank of Indonesia.
Bank Negara Indonesia (BNI '46)
Bank BNI underwent Unit III by Law No. 17 Year 1968 changed to Bank Negara Indonesia '46.
Bank Dagang Negara (BDN)
Derived from Bank Escompto BDN in nasionalisasikan with Regulation No. 13 Year 1960, but the PP (Government Regulation) was revoked by replaced by Law No. 18 Year 1968 as Bank Dagang Negara. BDN is the only bank outside Government yangberada Bank Negara Indonesia Unit.
Bank Bumi Daya (BBD)
BBD originally derived from the Nederlandsch Indische Hendles Bank, then became Hendles Nationale Bank, the bank then became Bank Negara Indonesia Unit IV and based on Law No. 19 Year 1968 into Bank Bumi Daya.
Development Bank of Indonesia (Bapindo)
Regional Development Bank (BPD)
This bank was established in the regions level I. Its legal basis is the Law No. 13 Year 1962.
State Savings Bank (BTN)
BTN, comes from De Post Paar Bank which later became the Postal Savings Bank in 1950. Furthermore, the Bank Negara Indonesia Unit V and the latter being the State Savings Bank by Law No. 20 Year 1968.
Bank Mandiri
Bank Mandiri is the result of the merger between Bank Bumi Daya (BBD), Bank Dagang Negara (BDN), Bank Indonesia's Development (Bapindo) and the Export Import Bank Indonesia (Bank Exim). The result of the four bank mergers was conducted in 1999.
The purpose of banking services
Bank service is very important in a country's economic development. Banking services are generally divided into two objectives. First, as the provider payment mechanism and an efficient tool for customers. For this, the bank provides cash, savings, and credit cards. This is the most important role of banks in economic life. Without the provision of an efficient means of payment, then goods can only be traded by way of barter that took time.
Second, by accepting savings from customers and lend it to those in need of funds, means that banks increase the flow of funds for investment and more productive utilization. If this role is well underway, the economy of a country will menngkat. Without the flow of these funds, the money just sit in the pocket of someone, that person can not obtain a business loan and can not be built because they do not have the loan fund.
Banking services are actually very much, only very few people who know about it. The purpose and benefits are very good for our customers. But many who use them for criminal acts, such as ATM burglary and forgery of books and other savings.
Bank types and functions
Three main groups of financial institutions - commercial banks, savings institutions and credit unions - also called storage because most of the institutions funded by customer deposits. Commercial banks are the largest group of institutions when measured by the amount of storage assets. They perform a similar function with the savings institutions and credit unions, namely, accepting deposits (liabilities) and make a loan (however, they differ in the composition of assets and liabilities, which are much more variable).
Asset concentration ratio of bank size, shows that banking consolidation has reduced the share of assets seems most small banks (assets under $ 1 billion). These banks - with assets under $ 1 billion - tend to specialize in retail or consumer banking, such as providing housing mortgages, consumer loans and deposit locally. While the bank's assets is relatively large (with assets of more than $ 1 billion), consisting of two classes are regional or super regional bank. They are involved in more complex wholesale about komersialperbankan activities, including consumer loans, residential and commercial and industrial loans (D & I Lending), both regionally and nationally. In addition, banks - big banks have access to buy the fund (fund) - such as inter-bank funds or government funds (federal funds) - to finance their lending and investment activities. However, some very large banks have different designations, namely the Central Bank. Currently, the banking organization to form groups of five Central Banks, namely: Bank of New York, Deutsche Bank (through the acquisition of the bankers trust each other), Citigroup, JP Morgan, and HSBC Bank in the United States. However, the numbers have declined due to megamergers. It is important to note that, assets or loans not always an indicator of a bank is the central bank. But, combined with the dependence on source location non deposit or loan funds.
banking services
Services - services are provided to support the raise and distribute funds, either directly related to savings and credit activities and indirectly. Other banking services include the following:
Deposit services such as electricity deposits, telephone, water, or tuition
Payment services such as payroll, pension, or gift
Remittance services (transfers)
Billing services (collection)
Clearing
Sales of foreign currency
Storage of documents
Check services tour
Credit card
Services - services that exist in the capital market such as loans and issuance of securities traders.
Services Letter of Credit (L / C)
Bank guarantees and bank references
Other bank services.
The banking industry has undergone major changes in recent years. This industry has become more competitive because of deregulation of the rules. Currently, banks have flexibility in the services they offer, the location where they operate, and the rates they pay depositors for deposits.
Understanding
According to Law Decree No. 10 Year 1998 on 10 November 1998 on the banks, it can be concluded that the banking business includes three activities, namely raise funds, distribute funds, and provides services to other banks. Events raise and distribute funds while the bank was successively principal activity provides services to other banks only support activities. Activities to collect funds, such as collecting funds from the public in the form of demand deposits, savings and time deposits. Usually he is given an attractive fringe benefits such as, flowers and gifts as a stimulus for the community. Activities to collect funds, in the form of lending to the public. Whereas in other banking services provided to support these primary activities. bank was founded by Prof.. Dr. Ali Afifuddin, SE In my opinion, the bank is a tool that facilitates the activities of the community to save money, in terms of commerce, or for future investment. The banking world is one institution that plays an important role in the economy of a country (particularly in the field of financing the economy). Here are some of the benefits of banking in the life:
As an investment model, which means that derivative transactions can be used as one model of investing. Although in general is kind of short-term investments (yield enhancement).
As a way of hedging, which means that derivative transactions can serve as one way to eliminate risk by hedging (hedging), or also known as risk management.
Price information, which means that derivative transactions can serve as a means of seeking or providing information about a specific commodity prices in the future (price discovery).
Speculative function, which means that derivative transactions can provide opportunities speculation (speculative) of market value changes of derivative transactions itself. 5. Production management functions carried out smoothly and efficiently, which means that derivative transactions can provide images to a manufacturer of production management in assessing a market demand and needs in the future. Apart from Functions-banking functions (bank) primary or derivatives, then one should pay attention to the banking world, is a philosophical purpose of the existence of banks in Indonesia. This is very clearly reflected in Article four (4) of Law Number 10 Year 1998 which explains, "Bank Indonesia aims to support the implementation of national development in order to improve equity, economic growth, national stability and prosperity toward the improvement of the people." Deeper review of the business activities of banks, the banks (banking) of Indonesia in carrying out its business should be based on the principle of economic democracy, which use the principle of hatian.4 This, clearly illustrated, because philosophically the bank has a function of macro and micro in the process of nation building .
Banking History
The Bank was first established in the form of such a firm is generally in the year 1690, when the British monarch willing to plan to rebuild naval power to compete with the French naval forces but the British government when it does not have the financial capability and then based on the idea that later William Paterson by Charles Montagu realized by forming a financial intermediary institutions that can eventually meet the financing fund in just twelve days.
History records the origin of banking activities is known at the time of a past empire in mainland Europe. Then the banking business has grown to West Asia by the merchants. The development of banking in Asia, Africa and America brought by Europeans during the colonial to country towns do well in Asia, Africa and the Americas. When traced, the history of banking familiar starting from the currency exchange service. Thus, in banking history, meaning the bank is known as a table where the currency exchange. In the course of the history of the kingdom in the first exchange between the kingdom of the money made one other royal circuitry. This exchange activity is now known as Foreign Exchange Dealer (Money Changer). Then in the next development, developing the banking operations into the care of money or so-called current deposit activity. Next banking activities increased with moneylending activities. The money saved by society, by banks lent back to the society needs it. Services of other banks followed in accordance with the development of the age and needs of an increasingly diverse society
History of Banking in Indonesia
Indonesia's banking history is inseparable from the Dutch East Indies colonial period. At that time De Javasche Bank, NV was founded in Batavia on January 24, 1828 and then followed Escompto Nederlandsche Indische Maatschappij, NV in 1918 as the holder of the monopoly purchase of agricultural products in domestic and overseas sales [and there are some banks that play an important role in Dutch East Indies. Existing banks were among others:
1. De Javasce NV.
2. De Post Poar Bank.
3. Hulp en Spaar Bank.
4. De Algemenevolks Crediet Bank.
5. Nederland handles Maatscappi (NHM).
6. Handles Nationale Bank (NHB).
7. De Escompto Bank NV.
8. Nederlansche Indische Handelsbank
In addition, there are also owned banks Indonesian people and foreigners such as from China, Japan, and Europe. These banks include:
1. NV. Nederlandsch Indische Spaar En Bank Deposit
2. National Bank Indonesia.
3. Merchant's Bank of gray.
4. Boemi Bank NV.
5. The Chartered Bank of India, Australia and China
6. Hongkong & Shanghai Banking Corporation
7. The Yokohama Species Bank.
8. The Matsui Bank.
9. The Bank of China.
10. Bank Batavia.
At the time of independence, Indonesia's banking stepped forward and grow again. Some Dutch bank dinasionalisir by the Indonesian government. The banks in the early days of independence, among others:
NV. Nederlandsch Indische Spaar En Deposit Bank (currently Bank OCBCNISP), founded 4 April 1941 with headquarters in Bandung
Bank Negara Indonesia, which was established on July 5, 1946, now known as BNI '46.
Bank Rakyat Indonesia, which was established on February 22, 1946. This bank was derived from De Algemenevolks Crediet Ginko Bank or Syomin.
Bank of Surakarta Airlines Adil Makmur (MAI) in 1945 in Solo.
Bank Indonesia in Palembang in 1946.
Bank Dagang Nasional Indonesia in 1946 in Medan.
Indonesian Banking Corporation in 1947 in Yogyakarta, later became Bank of Amrita.
Bank NV in Manado in Sulawesi in 1946.
Indonesian Trade Bank NV in Samarinda in 1950 and then merged with Bank of the Pacific.
East Bank NV in Semarang changed its name to Bank Gemari. Subsequently merged with Bank Central Asia (BCA) in 1949.
In Indonesia, the practice has spread to banking to remote rural areas. Form of bank financial institutions in Indonesia in the form of Commercial Banks, Rural Banks (BPR), Commercial Bank of Sharia, as well as BPR Syariah (BPRS). Each bank institutions is a different shape characteristics and functions
Government Banks
Through Decree No. 1/M/61 dated January 6, 1961 which prohibits the announcement and publication of monetary statistics and banking, then between the years 1960 to 1965, Bank Indonesia does not publish annual reports, including statistical data on the central clearing and calculation.
On July 5, 1964, on the basis of political considerations to simplify the command in the banking sector to support the Universal Development Planning, then in 1965 the government established a policy to integrate all the state banks into one bank under the name Bank Negara Indonesia, the initiative is the integration of government bank comes from the idea Jusuf Muda Dalam, who was then serving as Minister of the Central Bank / Governor of Bank Indonesia - the newly appointed President Director of BNI original position - and approved by President Sukarno. The basic idea is to make banking as a tool of revolution with the motto of the Bank under the leadership struggle in the Great Leader of the Revolution. Name of Bank Negara Indonesia (BNI) as a single bank, proposed by Joseph Young in itself. The result was the birth of this new structure makes the struggling bank;
Bank Indonesia to Bank Negara Indonesia Unit I,
Farmers and Fishermen Cooperative Bank and the Bank of Eczema Indonesia became Bank Negara Indonesia Unit II;
Bank Negara Indonesia to Bank Negara Indonesia Unit III;
State Commercial Bank became Bank Negara Indonesia Unit IV and
State Savings Bank became Bank Negara Indonesia Unit V.
But not all government bank successfully integrated into the struggling bank Bank Dagang Negara (BDN) and Bapindo. BDN Luputnya of this integration process, especially because President Director BDN JD Massie when it served as Minister of Reform of the National Private Banks which would have had enough clout to object to the pooling of BDN with other banks. Massie argues that this policy will confuse overseas correspondent banks for the settlement of L / C, export and import for the name of the same bank. Meanwhile, Bapindo not integrated into the Bank Fought because this bank under the Development Council chaired by the First Minister of Development Affairs with members of the Finance Minister, who is also Chairman of the Supervisory Board Bapindo, and Governor of Bank Indonesia as a member. Thus, through his position, the effect is strong enough to deter Bapindo integrated into the BNI.
Private Bank
In 1965 the government wants to mengabungkan all private banks or foreign banks in Private Development Bank as the sole collector and dealer banks of all progressive funds in the private sector and tools that can be used Universal Development Plan and other plans specified by the President of the Republic of Indonesia.
History of Government Banks
As is well known that the Indonesian banking world knew of the former penjajahnya, namely the Netherlands. Therefore, history is not free from the influence perbankanpun country menjajahnya for both government banks and private banks. In 1958, the government nationalized the Dutch-owned bank began with Handelsbank Nationale (NHB) in 1959 which subsequently changed to the State Commercial Banks (BUNEG later became Bank Bumi Daya), then in 1960 consecutive Escomptobank to Bank Dagang Negara (BDN) and Nederlandsche Handelsmaatschappij (NHM) to Farmers and Fishermen Cooperative Bank (BKTN) and then became the Export Import Bank of Indonesia (BEII).
The following will briefly described the history of government-owned banks, namely:
Central Bank
Central Bank of Indonesia is Bank Indonesia (BI) based on Law No. 13 Year 1968. Then asserted again circuitry Law No. 23 Year 1999.Bank was previously derived from De Javasche Bank in nasionalkan in the year 1951.
Bank Rakyat Indonesia and Bank Export Import
This bank was derived from De Algemene Volkscrediet Bank, then in the melting after a single bank under the name National Bank Indonesia (BNI), Unit II, which is engaged in rural and export import (exim), separated into:
In charge of rural to Bank Rakyat Indonesia and Law No. 21 Year 1968.
In charge of Exim with the Law No. 22 Year 1968 became Export Import Bank of Indonesia.
Bank Negara Indonesia (BNI '46)
Bank BNI underwent Unit III by Law No. 17 Year 1968 changed to Bank Negara Indonesia '46.
Bank Dagang Negara (BDN)
Derived from Bank Escompto BDN in nasionalisasikan with Regulation No. 13 Year 1960, but the PP (Government Regulation) was revoked by replaced by Law No. 18 Year 1968 as Bank Dagang Negara. BDN is the only bank outside Government yangberada Bank Negara Indonesia Unit.
Bank Bumi Daya (BBD)
BBD originally derived from the Nederlandsch Indische Hendles Bank, then became Hendles Nationale Bank, the bank then became Bank Negara Indonesia Unit IV and based on Law No. 19 Year 1968 into Bank Bumi Daya.
Development Bank of Indonesia (Bapindo)
Regional Development Bank (BPD)
This bank was established in the regions level I. Its legal basis is the Law No. 13 Year 1962.
State Savings Bank (BTN)
BTN, comes from De Post Paar Bank which later became the Postal Savings Bank in 1950. Furthermore, the Bank Negara Indonesia Unit V and the latter being the State Savings Bank by Law No. 20 Year 1968.
Bank Mandiri
Bank Mandiri is the result of the merger between Bank Bumi Daya (BBD), Bank Dagang Negara (BDN), Bank Indonesia's Development (Bapindo) and the Export Import Bank Indonesia (Bank Exim). The result of the four bank mergers was conducted in 1999.
The purpose of banking services
Bank service is very important in a country's economic development. Banking services are generally divided into two objectives. First, as the provider payment mechanism and an efficient tool for customers. For this, the bank provides cash, savings, and credit cards. This is the most important role of banks in economic life. Without the provision of an efficient means of payment, then goods can only be traded by way of barter that took time.
Second, by accepting savings from customers and lend it to those in need of funds, means that banks increase the flow of funds for investment and more productive utilization. If this role is well underway, the economy of a country will menngkat. Without the flow of these funds, the money just sit in the pocket of someone, that person can not obtain a business loan and can not be built because they do not have the loan fund.
Banking services are actually very much, only very few people who know about it. The purpose and benefits are very good for our customers. But many who use them for criminal acts, such as ATM burglary and forgery of books and other savings.
Bank types and functions
Three main groups of financial institutions - commercial banks, savings institutions and credit unions - also called storage because most of the institutions funded by customer deposits. Commercial banks are the largest group of institutions when measured by the amount of storage assets. They perform a similar function with the savings institutions and credit unions, namely, accepting deposits (liabilities) and make a loan (however, they differ in the composition of assets and liabilities, which are much more variable).
Asset concentration ratio of bank size, shows that banking consolidation has reduced the share of assets seems most small banks (assets under $ 1 billion). These banks - with assets under $ 1 billion - tend to specialize in retail or consumer banking, such as providing housing mortgages, consumer loans and deposit locally. While the bank's assets is relatively large (with assets of more than $ 1 billion), consisting of two classes are regional or super regional bank. They are involved in more complex wholesale about komersialperbankan activities, including consumer loans, residential and commercial and industrial loans (D & I Lending), both regionally and nationally. In addition, banks - big banks have access to buy the fund (fund) - such as inter-bank funds or government funds (federal funds) - to finance their lending and investment activities. However, some very large banks have different designations, namely the Central Bank. Currently, the banking organization to form groups of five Central Banks, namely: Bank of New York, Deutsche Bank (through the acquisition of the bankers trust each other), Citigroup, JP Morgan, and HSBC Bank in the United States. However, the numbers have declined due to megamergers. It is important to note that, assets or loans not always an indicator of a bank is the central bank. But, combined with the dependence on source location non deposit or loan funds.
banking services
Services - services are provided to support the raise and distribute funds, either directly related to savings and credit activities and indirectly. Other banking services include the following:
Deposit services such as electricity deposits, telephone, water, or tuition
Payment services such as payroll, pension, or gift
Remittance services (transfers)
Billing services (collection)
Clearing
Sales of foreign currency
Storage of documents
Check services tour
Credit card
Services - services that exist in the capital market such as loans and issuance of securities traders.
Services Letter of Credit (L / C)
Bank guarantees and bank references
Other bank services.
Thursday, June 24, 2010
ISLAMIC BANKING
Islamic banking or Islamic banking is a banking system that was developed based on the sharia (law) of Islam. Operating system formation is constituted by the prohibition in Islamic religion to pick up or borrow with interest or so-called ban on usury and investment for businesses categorized as haram (ie business relating to the production of food / drink unlawful, un-Islamic media business etc. ), where this can not be guaranteed by the conventional banking system.
History
Islamic banking first appeared in Egypt without the frills of Islam, because of fears the regime in power at that time would see it as a fundamentalist movement. The pioneering effort, led by Ahmad El Najjar, took the form of a savings bank based on profit sharing (profit sharing) in the town of Mit Ghamr in 1963. This experiment lasted until 1967, and then it was up nine banks with a similar concept in Egypt. These banks, which do not collect or receive interest, most businesses invest in trade and industry directly in the form of partnership and divide the profits earned by savers.
Still in the same country, in 1971, Nasir Social Bank was established and declared itself as an interest-free commercial bank. Although not mentioned in the deed of establishment of religion or references to Islamic Shari'a.
Islamic Development Bank (IDB) was established in 1974 and sponsored by the countries belonging to the Organization of Islamic Conference, although the bank is the main intergovernmental bank aims to provide funds for development projects in its member countries. IDB provides fee-based financial services and profit sharing for these countries and explicitly declare themselves, based on Islamic sharia.
Dibelahan other countries in that period of the 1970s, a number of Islam-based bank then appeared. In the Middle East, among others, stood Dubai Islamic Bank (1975), Faisal Islamic Bank of Sudan (1977), Faisal Islamic Bank of Egypt (1977) and Bahrain Islamic Bank (1979). He Asia-Pacific Philippine Amanah Bank was founded in 1973 by presidential decree, and in Malaysia in 1983 stood Muslim Pilgrims Savings Corporation, which aims to help those who want to save in order to perform the pilgrimage.
In Indonesia, the pioneer of Islamic banking is the Bank Muamalat Indonesia. Established in 1991, the bank was initiated by the Indonesian Ulema Council (MUI), and government and support from the Association of Indonesian Muslim Intellectuals (ICMI) and several Muslim businessmen. This bank had negatively affected by the monetary crisis in the late '90s that left only a third of its equity capital. IDB and then give an injection of funds to these banks and in the period 1999-2002 can be up and generating profits. [1]. We have the existence of sharia banks in Indonesia have been set in the Law of Law. 10 years on the amendment of Act No. 1998. 7 year 1992 about banking.
Until the year 2007 there are three institutions of Islamic bank in Indonesia, including Bank Muamalat Indonesia, Bank Syariah Mandiri and Bank Syariah Mega. Meanwhile, commercial banks have sharia business unit is among 19 banks are large banks like Bank Negara Indonesia (Persero), Bank Rakyat Indonesia (Persero) and the national private banking sector: the National Pension Savings Bank (PT).
Sharia system has also been used by rural banks, has now developed 104 BPRS. [Edit] Principles of Islamic banking
The principle is the rule of sharia Islamic law based on agreement between the bank and another party for safekeeping of funds and / or financing activities or other activities in accordance with sharia.
Some principles / laws adopted by the Islamic banking system, among others
Payment of loans with different values of the loan value with the predetermined value is not allowed.
Funders must also share the profits and losses as a result of the business institutions that borrow funds.
Islam does not allow the "making money from money." Money is only a medium of exchange and not a commodity because it has no intrinsic value.
Elements gharar (uncertainty, speculation) is not allowed. Both parties must know all too well the results of which will they gain from a transaction.
Investments should only be given to those businesses which are not forbidden in Islam. Liquor business for example can not be funded by Islamic banking.
Islamic banking principles
The principle is the rule of sharia Islamic law based on agreement between the bank and another party for safekeeping of funds and / or financing activities or other activities in accordance with sharia.
Some principles / laws adopted by the Islamic banking system, among others
Payment of loans with different values of the loan value with the predetermined value is not allowed.
Funders must also share the profits and losses as a result of the business institutions that borrow funds.
Islam does not allow the "making money from money." Money is only a medium of exchange and not a commodity because it has no intrinsic value.
Elements gharar (uncertainty, speculation) is not allowed. Both parties must know all too well the results of which will they gain from a transaction.
Investments should only be given to those businesses which are not forbidden in Islam. Liquor business for example can not be funded by Islamic banking.
Islamic banking principles will ultimately bring benefit to the people because it promises to balance its economic system
Comments: This is unfortunate because the lack of knowledge about these principles so that there are still many people who feel less secure and less easy to use the facilities contained in Bank Syariah principles. In perbankaqn Shariah has arranged various kinds of transactions that are not harmful for both parties. Because if you let anyone harmed and harmed then it violates the teachings of Islam itself. Shariah banking principles is itself derived from the Quran and Hadith.
Islamic banking products
Services to the borrower of funds
Mudhorobah, is an agreement between the provider of capital to entrepreneurs. Any gains achieved will be divided according to specific ratios agreed upon. Risk of loss will be filled by the Bank except for losses caused by mismanagement, negligence and abuse of party customers such as misappropriation, fraud and abuse.
Musyarokah (Joint Venture), this concept is applied to the model of a partnership or joint venture. The advantage gained will be shared in an agreed ratio while losses will be divided based on the ratio of equity owned by each party. The fundamental difference with mudaraba there is in this concept, while its management management intervention mudaraba no interference.
Murobahah, namely the distribution of funds in the form of buying and selling. Banks will be required to buy goods and then resells the service user to service users in accordance with price elevated banks set profit margins, and users can pay in goods. The installment contract, the flat line early and the amount of installment = cost of goods plus an agreed margin. Examples: house prices, 500 million, the margin of the bank / bank profits jt 100, customers paid the borrower is 600 million and be paid over an agreed period beginning between the Bank and the Customer.
Takaful (Islamic insurance)
Services for storage fund
Wadiah (care services), is the custody of Care funds which can take those funds at any time. With the system of bank deposits are not obligated, but allowed, to give a bonus to customers.
Mudhorobah deposits, customers save money in the bank within a certain period of time. Gains from investments of funds by bank customers will be shared between the bank and its customers with a specific revenue sharing.
The Challenge Fund Management
The growth rate of Islamic banking at the global level no doubt. Asset Islamic financial institutions in the world is estimated to reach 250 billion U.S. dollars, grew by an average of more than 15 percent per year. In Indonesia, the Islamic banking business volume during the last five years grew an average of 60 percent per year. In 2005, the Indonesian Sharia banking book profit of Rp 238.6 billion, up 47 percent from a year earlier. Even so, Indonesia has a vast market potential for Islamic banking, still lags far behind Malaysia.
Last year, Malaysia's Islamic banking profit to print more than one billion ringgit (272 million U.S. dollars). End of March 2006, Islamic banking assets in this neighbor country of almost 12 percent of the total assets of national banks. While in Indonesia, Islamic banking assets in March 2006 a new period was recorded 1.40 percent of total banking assets. Bank Indonesia predicted, the accelerated growth of Islamic banking in Indonesia will begin this year.
Implementation of the policy office channeling, accelerating government support in the form of pilgrims who will be managing accounts entrusted to Islamic banking, as well as the presence of new investors will encourage the growth of sharia business. Islamic banking consultant, Adiwarman Azwar Karim, argued, the development of Islamic banking, among others, will be marked on sharia bonds, or sukuk, which prepared the government.
A number of foreign banks in Indonesia, such as Citibank and HSBC, even getting ready to welcome with open sukuk sharia. Meanwhile, a number of investors from the Gulf countries are also preparing to buy banks in Indonesia and converted to the Islamic bank. The selected criteria are generally beraset banks are relatively small, ranging from Rp 500 billion and Rp 2 trillion. Once converted, the banks attempted to do a syndicated financing large projects, involving a global financial institution.
The presence of Islamic banking in Indonesia was pioneered by the establishment of Bank Muamalat Indonesia, initiated by the Indonesian Ulema Council (MUI) with the aim of accommodating a variety of aspirations and opinions in society, especially people of Islam that many argue that it is haraam because the bank interest, including usury and also to take the principle of attention. When viewed in terms of economic and business value, this represents a major breakthrough because 80% of Indonesian Moslems, of course, is a business with huge potential. Although some people argue that Islamic bank interest is not usury but avail, because the interest is given or taken by the bank are small so will not be harmed or didzolimi each other, but still, for the people of the Islamic establishment of sharia banks are a big improvement.
But the Islamic banking system in Indonesia is still not perfect or there are still shortcomings that still descended on Bank Indonesia, the Indonesian government ideally set up specialized financial institution at the same level of sharia Bank Indonesia, Bank Indonesia Sharia.
We hope the attention from governments and observer-based Islamic banking to further refine the system of Islamic banking in Indonesia to be more konprehensip and more perfect, not only founded the Islamic banking business because there is momentum per se, but note the rules and Islam as a whole.
Comparison between conventional and Islamic Banking Bank General
Just do a halal investment. 2. Based on the principle of revenue sharing, buy-sell, or rent. 3. Profit and falah orentet. 4. Relationships with customers in the form of partnerships. 5. Collection and disbursement of funds shall be in accordance with the Sharia Supervisory Board fatwa.
Conventional Banks
Wearing a flower prangkat
Investments that are halal and haram
Profit oriented.
Relationships with customers in the form of the relationship debtor / creditors.
There are no similar councils.
History
Islamic banking first appeared in Egypt without the frills of Islam, because of fears the regime in power at that time would see it as a fundamentalist movement. The pioneering effort, led by Ahmad El Najjar, took the form of a savings bank based on profit sharing (profit sharing) in the town of Mit Ghamr in 1963. This experiment lasted until 1967, and then it was up nine banks with a similar concept in Egypt. These banks, which do not collect or receive interest, most businesses invest in trade and industry directly in the form of partnership and divide the profits earned by savers.
Still in the same country, in 1971, Nasir Social Bank was established and declared itself as an interest-free commercial bank. Although not mentioned in the deed of establishment of religion or references to Islamic Shari'a.
Islamic Development Bank (IDB) was established in 1974 and sponsored by the countries belonging to the Organization of Islamic Conference, although the bank is the main intergovernmental bank aims to provide funds for development projects in its member countries. IDB provides fee-based financial services and profit sharing for these countries and explicitly declare themselves, based on Islamic sharia.
Dibelahan other countries in that period of the 1970s, a number of Islam-based bank then appeared. In the Middle East, among others, stood Dubai Islamic Bank (1975), Faisal Islamic Bank of Sudan (1977), Faisal Islamic Bank of Egypt (1977) and Bahrain Islamic Bank (1979). He Asia-Pacific Philippine Amanah Bank was founded in 1973 by presidential decree, and in Malaysia in 1983 stood Muslim Pilgrims Savings Corporation, which aims to help those who want to save in order to perform the pilgrimage.
In Indonesia, the pioneer of Islamic banking is the Bank Muamalat Indonesia. Established in 1991, the bank was initiated by the Indonesian Ulema Council (MUI), and government and support from the Association of Indonesian Muslim Intellectuals (ICMI) and several Muslim businessmen. This bank had negatively affected by the monetary crisis in the late '90s that left only a third of its equity capital. IDB and then give an injection of funds to these banks and in the period 1999-2002 can be up and generating profits. [1]. We have the existence of sharia banks in Indonesia have been set in the Law of Law. 10 years on the amendment of Act No. 1998. 7 year 1992 about banking.
Until the year 2007 there are three institutions of Islamic bank in Indonesia, including Bank Muamalat Indonesia, Bank Syariah Mandiri and Bank Syariah Mega. Meanwhile, commercial banks have sharia business unit is among 19 banks are large banks like Bank Negara Indonesia (Persero), Bank Rakyat Indonesia (Persero) and the national private banking sector: the National Pension Savings Bank (PT).
Sharia system has also been used by rural banks, has now developed 104 BPRS. [Edit] Principles of Islamic banking
The principle is the rule of sharia Islamic law based on agreement between the bank and another party for safekeeping of funds and / or financing activities or other activities in accordance with sharia.
Some principles / laws adopted by the Islamic banking system, among others
Payment of loans with different values of the loan value with the predetermined value is not allowed.
Funders must also share the profits and losses as a result of the business institutions that borrow funds.
Islam does not allow the "making money from money." Money is only a medium of exchange and not a commodity because it has no intrinsic value.
Elements gharar (uncertainty, speculation) is not allowed. Both parties must know all too well the results of which will they gain from a transaction.
Investments should only be given to those businesses which are not forbidden in Islam. Liquor business for example can not be funded by Islamic banking.
Islamic banking principles
The principle is the rule of sharia Islamic law based on agreement between the bank and another party for safekeeping of funds and / or financing activities or other activities in accordance with sharia.
Some principles / laws adopted by the Islamic banking system, among others
Payment of loans with different values of the loan value with the predetermined value is not allowed.
Funders must also share the profits and losses as a result of the business institutions that borrow funds.
Islam does not allow the "making money from money." Money is only a medium of exchange and not a commodity because it has no intrinsic value.
Elements gharar (uncertainty, speculation) is not allowed. Both parties must know all too well the results of which will they gain from a transaction.
Investments should only be given to those businesses which are not forbidden in Islam. Liquor business for example can not be funded by Islamic banking.
Islamic banking principles will ultimately bring benefit to the people because it promises to balance its economic system
Comments: This is unfortunate because the lack of knowledge about these principles so that there are still many people who feel less secure and less easy to use the facilities contained in Bank Syariah principles. In perbankaqn Shariah has arranged various kinds of transactions that are not harmful for both parties. Because if you let anyone harmed and harmed then it violates the teachings of Islam itself. Shariah banking principles is itself derived from the Quran and Hadith.
Islamic banking products
Services to the borrower of funds
Mudhorobah, is an agreement between the provider of capital to entrepreneurs. Any gains achieved will be divided according to specific ratios agreed upon. Risk of loss will be filled by the Bank except for losses caused by mismanagement, negligence and abuse of party customers such as misappropriation, fraud and abuse.
Musyarokah (Joint Venture), this concept is applied to the model of a partnership or joint venture. The advantage gained will be shared in an agreed ratio while losses will be divided based on the ratio of equity owned by each party. The fundamental difference with mudaraba there is in this concept, while its management management intervention mudaraba no interference.
Murobahah, namely the distribution of funds in the form of buying and selling. Banks will be required to buy goods and then resells the service user to service users in accordance with price elevated banks set profit margins, and users can pay in goods. The installment contract, the flat line early and the amount of installment = cost of goods plus an agreed margin. Examples: house prices, 500 million, the margin of the bank / bank profits jt 100, customers paid the borrower is 600 million and be paid over an agreed period beginning between the Bank and the Customer.
Takaful (Islamic insurance)
Services for storage fund
Wadiah (care services), is the custody of Care funds which can take those funds at any time. With the system of bank deposits are not obligated, but allowed, to give a bonus to customers.
Mudhorobah deposits, customers save money in the bank within a certain period of time. Gains from investments of funds by bank customers will be shared between the bank and its customers with a specific revenue sharing.
The Challenge Fund Management
The growth rate of Islamic banking at the global level no doubt. Asset Islamic financial institutions in the world is estimated to reach 250 billion U.S. dollars, grew by an average of more than 15 percent per year. In Indonesia, the Islamic banking business volume during the last five years grew an average of 60 percent per year. In 2005, the Indonesian Sharia banking book profit of Rp 238.6 billion, up 47 percent from a year earlier. Even so, Indonesia has a vast market potential for Islamic banking, still lags far behind Malaysia.
Last year, Malaysia's Islamic banking profit to print more than one billion ringgit (272 million U.S. dollars). End of March 2006, Islamic banking assets in this neighbor country of almost 12 percent of the total assets of national banks. While in Indonesia, Islamic banking assets in March 2006 a new period was recorded 1.40 percent of total banking assets. Bank Indonesia predicted, the accelerated growth of Islamic banking in Indonesia will begin this year.
Implementation of the policy office channeling, accelerating government support in the form of pilgrims who will be managing accounts entrusted to Islamic banking, as well as the presence of new investors will encourage the growth of sharia business. Islamic banking consultant, Adiwarman Azwar Karim, argued, the development of Islamic banking, among others, will be marked on sharia bonds, or sukuk, which prepared the government.
A number of foreign banks in Indonesia, such as Citibank and HSBC, even getting ready to welcome with open sukuk sharia. Meanwhile, a number of investors from the Gulf countries are also preparing to buy banks in Indonesia and converted to the Islamic bank. The selected criteria are generally beraset banks are relatively small, ranging from Rp 500 billion and Rp 2 trillion. Once converted, the banks attempted to do a syndicated financing large projects, involving a global financial institution.
The presence of Islamic banking in Indonesia was pioneered by the establishment of Bank Muamalat Indonesia, initiated by the Indonesian Ulema Council (MUI) with the aim of accommodating a variety of aspirations and opinions in society, especially people of Islam that many argue that it is haraam because the bank interest, including usury and also to take the principle of attention. When viewed in terms of economic and business value, this represents a major breakthrough because 80% of Indonesian Moslems, of course, is a business with huge potential. Although some people argue that Islamic bank interest is not usury but avail, because the interest is given or taken by the bank are small so will not be harmed or didzolimi each other, but still, for the people of the Islamic establishment of sharia banks are a big improvement.
But the Islamic banking system in Indonesia is still not perfect or there are still shortcomings that still descended on Bank Indonesia, the Indonesian government ideally set up specialized financial institution at the same level of sharia Bank Indonesia, Bank Indonesia Sharia.
We hope the attention from governments and observer-based Islamic banking to further refine the system of Islamic banking in Indonesia to be more konprehensip and more perfect, not only founded the Islamic banking business because there is momentum per se, but note the rules and Islam as a whole.
Comparison between conventional and Islamic Banking Bank General
Just do a halal investment. 2. Based on the principle of revenue sharing, buy-sell, or rent. 3. Profit and falah orentet. 4. Relationships with customers in the form of partnerships. 5. Collection and disbursement of funds shall be in accordance with the Sharia Supervisory Board fatwa.
Conventional Banks
Wearing a flower prangkat
Investments that are halal and haram
Profit oriented.
Relationships with customers in the form of the relationship debtor / creditors.
There are no similar councils.
Tuesday, June 15, 2010
PRICE OF AN INVESTMENT
At least half of the investment in Indonesia in 2011 came from the private sector. This conclusion from the figures contained in the Draft Budget and Revenue Expenditure (Budget) for the year 2011.
Year 2011, the value of the investment required USD 2243.8 trillion. According to Coordinating Minister for Economy, Hatta Rajasa, the government is only able to cover a maximum of 17% of the total investment required.
Are private investors, foreign and domestic investment is expected to patch up this country needs. The Government does not expect business investment needs to close all numbers, but only partially.
It's not that easy to realized expectations. Investments referred to in this context rather than placing the money in financial assets such as stocks or bonds. But the direct investment activities, commonly referred to foreign direct investment (FDI).
Hope it does not easily realized because of the potential investors aware of their strong bargaining position. This country needs to accelerate the rotation of the wheels of their economies. That is why, most investors put a high price before invest. They asked for tax exemption.
It is probable, the government will not be able to grant all requests tax holiday. How else could be burdensome tax exemption budget.
At times like this, is there that can still attract the FDI investors? Clearly there is. Indonesia should be able to improve the investment climate. For example, make the rules more consistent.
Maybe it sounds cliche advice because it preached a thousand times. But in fact, still a lot of homework to be completed by the managers of this country, whether in the executive branch-legislative-judicial bodies or in regional centers.
Recent examples are disputes about land oil palm plantation in what should be a forest. The story that happened in North Sumatra had the same themes as the story of forest annexation by coal miners in East Kalimantan, in 2009 three-four years ago.
Initially the rule of law collide, then there is letting. And after the plantation or mining it is running, the new central government issued.
Without improvement of business climate, should not be surprised if investors always put a high price.
Year 2011, the value of the investment required USD 2243.8 trillion. According to Coordinating Minister for Economy, Hatta Rajasa, the government is only able to cover a maximum of 17% of the total investment required.
Are private investors, foreign and domestic investment is expected to patch up this country needs. The Government does not expect business investment needs to close all numbers, but only partially.
It's not that easy to realized expectations. Investments referred to in this context rather than placing the money in financial assets such as stocks or bonds. But the direct investment activities, commonly referred to foreign direct investment (FDI).
Hope it does not easily realized because of the potential investors aware of their strong bargaining position. This country needs to accelerate the rotation of the wheels of their economies. That is why, most investors put a high price before invest. They asked for tax exemption.
It is probable, the government will not be able to grant all requests tax holiday. How else could be burdensome tax exemption budget.
At times like this, is there that can still attract the FDI investors? Clearly there is. Indonesia should be able to improve the investment climate. For example, make the rules more consistent.
Maybe it sounds cliche advice because it preached a thousand times. But in fact, still a lot of homework to be completed by the managers of this country, whether in the executive branch-legislative-judicial bodies or in regional centers.
Recent examples are disputes about land oil palm plantation in what should be a forest. The story that happened in North Sumatra had the same themes as the story of forest annexation by coal miners in East Kalimantan, in 2009 three-four years ago.
Initially the rule of law collide, then there is letting. And after the plantation or mining it is running, the new central government issued.
Without improvement of business climate, should not be surprised if investors always put a high price.
Wednesday, June 2, 2010
REFINANCING WITH POOR CREDIT
Investment differences with them money
There are two fundamental differences between investment by putting money bungakan. The difference can be reviewed from the definition to the meaning of each.
1. Investing is a business activity that involves risk of dealing with the element of uncertainty.
Thus, the acquisition of the change (return) is uncertain and not fixed.
2. Lend money is a business activity that is less risky because of the acquisition of the change in
the form of interest is relatively certain and fixed.
Islam encourages people towards tangible and productive business. Islam encourages the entire community to make investments and prohibits them money. In accordance with the above definition, save money in Islamic banks, including categories of investment activity due to the acquisition of the change (return) from time to time is uncertain and not fixed. The size of the recovery was dependent on the results of operations which actually happened and the bank as mudharib or fund manager.
Thus, Islamic banks can not simply distribute the money. Islamic banks should strive to increase the return or return on investment so that more interesting and more to give confidence to the owner of the funds.
Difference Money Debt and Debt Products
There are two different types of loans to each other, that is debt incurred by borrowing money and the debt incurred for the procurement of goods. Debt incurred for borrowing additional money should not be there, but with a definite and obvious reasons, such as stamp duty, notary fees, and feasibility studies. Other additional nature uncertain and unclear, such as inflation and deflation, are not allowed. Debt incurred for financing the procurement of goods must be clear in one unified whole or is the selling price. The sale price itself consists of the cost of goods plus an agreed profit. Once the sale price had been agreed, then the change should not go up forever, because it will be included in the category of riba fadl. In Islamic banking transaction that appears is a liability in the form of debt, procurement, not a money debt.
The difference between Interest and Profit Sharing
Once again, Islam encourages sharing practice and forbids usury. Both give benefits to owners of funds, but both have a very real difference. The differences can be explained as follows:
• Interest: Interest Determination made at the time the contract with
thassumption must always be lucky Profit Sharing: The determination of
the ratio / revenue sharing agreement made at the time by referring to the
possibility of profit and loss
• Interest: The percentage is based on the amount of money (capital),
which lent For Results: The ratio for the results based on the amount of benefits
• Interest: Interest paid fixed as promised without any consideration of whether
the project carried out by the customers' profit or loss
For results: depending on the benefits of the projects being undertaken.
When businesses lose money, the loss would be borne jointly by both parties.
• Interest: The amount of interest payments does not increase even if the
amount of profits multiplied or economic circumstances were "booming"
Profit sharing: The amount of profit sharing increases with increase in total
revenue.
• Flowers: The existence of questionable interest (if not criticized) by several
circles Profit sharing: There is no doubting the validity of the results
Below I attach some opinions from some religious opinions about the ugliness and lack of money magnifies the wrong way:
Entrenches usury interest / preferred return on the loan amount at a certain percentage of the outstanding principal, which is charged to the borrower. Riba in a meaningful language: ziyadah (optional). In another sense, linguistically usury also means to grow and expand. While according to technical terms, riba means making additional principal or capital of the property is false. There are several opinions in explaining usury, but in general there is a red thread which states that usury is an additional intake in both transactions and borrowing and lending are false or contrary to the principles of Islamic Muamalat.
Riba in the religious views
The word riba in terms of language means "excess." So if we just stopped to mean "excess", the logic put forward the polytheists in the well-founded. Although the Qur'an only answer their questions by saying "God justifies the buying, selling and forbidden usury" (Qur'an 2:275), and penghalalan pengharaman is of course not be done without the existence of "something" that sets it apart, and "something" that is the cause of keharamannya .
Riba is not just a problem of Islamic society, but many outside the Muslim community had a serious look at the issue of riba. The study of usury problem can be traced back to over 2000 years ago. Problem of usury has become a discussion among Jewish, Greek, nor Roman. Christian circles from time to time also has its own view on usury.
Riba in Islam
In Islam, picked up a profit in the form of riba or usury is haram loan. This was emphasized in the Qur'an Surah Al-Baqarah verse 275: Allah has made ... when buying, selling and forbidden usury .... This view is also an encouraging rise of Islamic banking in which the concept of benefits to depositors for the results obtained from the system instead of flowers such as conventional banks, because according to some opinions (including the Indonesian Ulema Council), bank interest included in usury. how a contract can be said that usury? striking thing is known that the bank interest that includes the enactment of usury is in the initial contract. so when we've saved with a specific interest rate, then we will know the outcome with certainty. different from the principles for results only provide revenue sharing for the depositors. its impact will be very long on the next transaction. that is, if the contract is set at the start / percentage obtained savers already known, so that a target to cover the amount of such interest is the entrepreneurs who borrow capital and whatever happens, the loss would be borne by the borrower. different from the results that only provide a certain ratio to the depositors. then divide the profits from that obtained then divided according to the ratio agreed upon by both parties. nisbahnya example is 60%: 40%, then the depositors 60% of the total profit earned by the bank.
Types of Riba
Broadly grouped into dua.Yaitu usury usury usury debt-selling accounts receivable and payable-receivable-beli.Riba divided into usury and usury Jaahiliyyah qard. While usury is divided into buying and selling and usury usury fadl nasi'ah.
• Riba Qardh
o A benefit or a certain level of surplus required of the debtor (muqtaridh).
• Riba Jaahiliyyah
o Loans are paid more than anyway, because the borrower is not able to pay its debts at the set time.
• Riba Fadhl
o Exchange antarbarang levels similar to or different doses, while the goods exchanged were included in the type of goods ribawi.
• Riba Nasi'ah
o Suspension of delivery or receipt of goods exchanged ribawi ribawi with other types of goods. Riba in nasi'ah arise because of differences, changes, or additions to be delivered between now submitted by later.
Usury in Judaism
Judaism forbids the practice of taking interest. This prohibition contained in many Jewish religious scriptures, both Old Testament and Talmudic law. Exodus 22:25 states:
"If you lend money sn one of my ummah, those who are poor among you, then you must not act as debt collectors against him, thou shalt not charge interest on it." Deuteronomy 23:19 states:
"Thou shalt not lend to your brother, whether cash or food, or anything that can dibungakan." Deuteronomy 23:20 states:
"From a foreigner you may charge interest, but from your brother, you must not pick flowers ... so the Lord your God bless you in all your efforts in the country that you are entering to possess." Leviticus 35:7 states:
"Thou shalt not take the interest money or usury from him, but thou shalt fear thy God, so that your brother may live among you. Thou shalt not give your money to him by asking for interest, do not you give your food too by asking for usury. "
Interest concept among Christians
New Testament does not mention this problem clearly. However, some Christian circles consider that the paragraph contained in Luke 6:34-5 as the verses that condemn the practice of taking interest. The verse states: "And if you lend to people, because you hope to get something from it, whether your services? Even sinners lend to sinners, so that they receive back as much. But love your enemies and then do good to them and lend without expecting a reply, then your reward will be great and you will become children of God the Most High, because He is kind toward the people and the ingratitude of the wicked. " paragraph indecision resulted in the emergence of various responses and interpretations of Christian religious leaders about whether or not Christians should practice making flowers. Diverse views among the leaders of the Christian religion can be grouped into three main periods, namely the views of the early Christian pastor (I to XII century), which forbids interest, views of Christian scholars (century XII - XVI) who wish to be allowed to flower, and the views of the reformers Christian (XVI century - in 1836) which causes interest justifies the Christian religion. Deuteronomy 23:20 states:
"From a foreigner you may charge interest, but from your brother, you must not pick flowers ... so the Lord your God bless you in all your efforts in the country that you are entering to possess."
Early views of the Reverend Christian (Century I - XII)
In this period, generally prohibited from taking interest. They refer to issues of interest to capture the Old Testament is also believed by Christians. St. Basil (329-379) consider those who eat the flowers as people who do not speak-humanity. For him, took the flowers are taking advantage of people in need. Similarly, collecting gold and wealth of tears and sorrow of the poor.
St. Gregory of Nyssa (335-395) condemned the practice of interest because he thinks aid through loans were false. At the beginning of the contract, such as helped but at the bill and ask for the interest to act so cruel. St. John Chrysostom (344-407) argues that the prohibition contained in the Old Testament which was addressed to the Jews also applies to adherents of the New Testament. St. Ambrose denounced as a fraud and flower eaters pembelit (moneylenders). St. Augustine believes the application of interest on the poor is more cruel than the robber who robbed the rich. Because both are equally robbed, one of the rich and another for the poor. St. Anselm of Centerbury (1033 - 1109) consider interest equal to the robbery. Ban the practice of interest was also issued by the church in the form of law (Canon): Council of Elvira (Spain in 306) issued the Canon 20 which prohibits church workers practicing taking interest. Whoever violates, then the rank will be reduced. Council of Arles (314 years) issued a Canon 44 which also prohibits the practice of the church workers are taking interest. First Council of Nicaea (325) issued the Canon 17 which threatened to fire workers who practice the church flowers. Prohibition of entry into newly issued common interest to the Council of Vienne (year 1311) which states that whoever considers that interest is something that is not sinful then he has been out of Christians (apostates).
The initial view of the Reverend Christian can be summed up as follows
Flowers are all the forms demanded in return that exceeds the number of items loaned. Taking the interest is a sin that is prohibited, both in the Old Testament and New Testament. Desire or intention to get benefits beyond what lent is a sin. Interest should be returned to its owner. An elevated price for the sale of goods on credit is also a hidden interest.
The Bachelor of Christian views (Ages XII - XVI)
In this period there developed very rapidly in the field of economy and trade. At that time, money and credit became an important element in society. Loan to provide working capital to merchants began rolling at the beginning of XII century. Financial markets slowly start to form. The process encourages the realization of the widespread market interest rates. Christian scholars during this period not only discuss issues of interest solely in moral terms that refer to the verses of the Old Testament and New Testament, they also relate to other aspects. Among others, concerning the type and form of legislation, a person's right to the property, characteristics and meaning of justice, benefit forms, intentions and actions of human beings, as well as the distinction between sins of individuals and groups.
They are deemed to have made new breakthroughs in connection with the definition of interest. From the results of their discussion for the purpose of refining and legitimizing the law, interest is divided into interest and usury. According to them, interest is interest that is allowed, while usury is excessive interest. Proponents of Christian scholars who contributed a huge opinion in connection with this interest is Robert of Courcon (1152-1218), William of Auxxerre (1160-1220), St. Raymond of Pennaforte (1180-1278), St. Bonaventure (1221-1274), and St. Thomas Aquinas (1225-1274). Conclusion of the discussion of Christian scholars such period in connection with the interest rates are as follows: Intention or deeds to gain by giving the loan is a sin that contrary to the concept of justice. Taking the interest of the loan is allowed, but illicit or not depends on the intention of the giver of debt.
The view of the Christian Reformed (XVI Century - Year 1836)
Opinion of the reformers had to change and form a new view of interest. The reformers were, among others, John Calvin (1509-1564), Charles du Moulin (1500 - 1566), Claude Saumaise (1588-1653), Martin Luther (1483-1546), Melanchthon (1497-1560), and Zwingli (1484 -1531).
Some of Calvin's opinions relating to interest, among others:
• Sin when the interest burden.
• Money can flourish (in contrast with Aristotle).
• No interest decision making as a profession.
• Do not take the interest of the poor.
Du Moulin urged that making a simple interest rate is allowed as long as it is used for productive purposes. Saumise, a follower of Calvin, to justify any taking of interest, although he comes from the poor. According to him, selling money with money is like a normal trade, then there is no reason to prohibit people who will use the money to make money. According to him too, religion need not bother to meddle in the affairs relating to the interest.
There are two fundamental differences between investment by putting money bungakan. The difference can be reviewed from the definition to the meaning of each.
1. Investing is a business activity that involves risk of dealing with the element of uncertainty.
Thus, the acquisition of the change (return) is uncertain and not fixed.
2. Lend money is a business activity that is less risky because of the acquisition of the change in
the form of interest is relatively certain and fixed.
Islam encourages people towards tangible and productive business. Islam encourages the entire community to make investments and prohibits them money. In accordance with the above definition, save money in Islamic banks, including categories of investment activity due to the acquisition of the change (return) from time to time is uncertain and not fixed. The size of the recovery was dependent on the results of operations which actually happened and the bank as mudharib or fund manager.
Thus, Islamic banks can not simply distribute the money. Islamic banks should strive to increase the return or return on investment so that more interesting and more to give confidence to the owner of the funds.
Difference Money Debt and Debt Products
There are two different types of loans to each other, that is debt incurred by borrowing money and the debt incurred for the procurement of goods. Debt incurred for borrowing additional money should not be there, but with a definite and obvious reasons, such as stamp duty, notary fees, and feasibility studies. Other additional nature uncertain and unclear, such as inflation and deflation, are not allowed. Debt incurred for financing the procurement of goods must be clear in one unified whole or is the selling price. The sale price itself consists of the cost of goods plus an agreed profit. Once the sale price had been agreed, then the change should not go up forever, because it will be included in the category of riba fadl. In Islamic banking transaction that appears is a liability in the form of debt, procurement, not a money debt.
The difference between Interest and Profit Sharing
Once again, Islam encourages sharing practice and forbids usury. Both give benefits to owners of funds, but both have a very real difference. The differences can be explained as follows:
• Interest: Interest Determination made at the time the contract with
thassumption must always be lucky Profit Sharing: The determination of
the ratio / revenue sharing agreement made at the time by referring to the
possibility of profit and loss
• Interest: The percentage is based on the amount of money (capital),
which lent For Results: The ratio for the results based on the amount of benefits
• Interest: Interest paid fixed as promised without any consideration of whether
the project carried out by the customers' profit or loss
For results: depending on the benefits of the projects being undertaken.
When businesses lose money, the loss would be borne jointly by both parties.
• Interest: The amount of interest payments does not increase even if the
amount of profits multiplied or economic circumstances were "booming"
Profit sharing: The amount of profit sharing increases with increase in total
revenue.
• Flowers: The existence of questionable interest (if not criticized) by several
circles Profit sharing: There is no doubting the validity of the results
Below I attach some opinions from some religious opinions about the ugliness and lack of money magnifies the wrong way:
Entrenches usury interest / preferred return on the loan amount at a certain percentage of the outstanding principal, which is charged to the borrower. Riba in a meaningful language: ziyadah (optional). In another sense, linguistically usury also means to grow and expand. While according to technical terms, riba means making additional principal or capital of the property is false. There are several opinions in explaining usury, but in general there is a red thread which states that usury is an additional intake in both transactions and borrowing and lending are false or contrary to the principles of Islamic Muamalat.
Riba in the religious views
The word riba in terms of language means "excess." So if we just stopped to mean "excess", the logic put forward the polytheists in the well-founded. Although the Qur'an only answer their questions by saying "God justifies the buying, selling and forbidden usury" (Qur'an 2:275), and penghalalan pengharaman is of course not be done without the existence of "something" that sets it apart, and "something" that is the cause of keharamannya .
Riba is not just a problem of Islamic society, but many outside the Muslim community had a serious look at the issue of riba. The study of usury problem can be traced back to over 2000 years ago. Problem of usury has become a discussion among Jewish, Greek, nor Roman. Christian circles from time to time also has its own view on usury.
Riba in Islam
In Islam, picked up a profit in the form of riba or usury is haram loan. This was emphasized in the Qur'an Surah Al-Baqarah verse 275: Allah has made ... when buying, selling and forbidden usury .... This view is also an encouraging rise of Islamic banking in which the concept of benefits to depositors for the results obtained from the system instead of flowers such as conventional banks, because according to some opinions (including the Indonesian Ulema Council), bank interest included in usury. how a contract can be said that usury? striking thing is known that the bank interest that includes the enactment of usury is in the initial contract. so when we've saved with a specific interest rate, then we will know the outcome with certainty. different from the principles for results only provide revenue sharing for the depositors. its impact will be very long on the next transaction. that is, if the contract is set at the start / percentage obtained savers already known, so that a target to cover the amount of such interest is the entrepreneurs who borrow capital and whatever happens, the loss would be borne by the borrower. different from the results that only provide a certain ratio to the depositors. then divide the profits from that obtained then divided according to the ratio agreed upon by both parties. nisbahnya example is 60%: 40%, then the depositors 60% of the total profit earned by the bank.
Types of Riba
Broadly grouped into dua.Yaitu usury usury usury debt-selling accounts receivable and payable-receivable-beli.Riba divided into usury and usury Jaahiliyyah qard. While usury is divided into buying and selling and usury usury fadl nasi'ah.
• Riba Qardh
o A benefit or a certain level of surplus required of the debtor (muqtaridh).
• Riba Jaahiliyyah
o Loans are paid more than anyway, because the borrower is not able to pay its debts at the set time.
• Riba Fadhl
o Exchange antarbarang levels similar to or different doses, while the goods exchanged were included in the type of goods ribawi.
• Riba Nasi'ah
o Suspension of delivery or receipt of goods exchanged ribawi ribawi with other types of goods. Riba in nasi'ah arise because of differences, changes, or additions to be delivered between now submitted by later.
Usury in Judaism
Judaism forbids the practice of taking interest. This prohibition contained in many Jewish religious scriptures, both Old Testament and Talmudic law. Exodus 22:25 states:
"If you lend money sn one of my ummah, those who are poor among you, then you must not act as debt collectors against him, thou shalt not charge interest on it." Deuteronomy 23:19 states:
"Thou shalt not lend to your brother, whether cash or food, or anything that can dibungakan." Deuteronomy 23:20 states:
"From a foreigner you may charge interest, but from your brother, you must not pick flowers ... so the Lord your God bless you in all your efforts in the country that you are entering to possess." Leviticus 35:7 states:
"Thou shalt not take the interest money or usury from him, but thou shalt fear thy God, so that your brother may live among you. Thou shalt not give your money to him by asking for interest, do not you give your food too by asking for usury. "
Interest concept among Christians
New Testament does not mention this problem clearly. However, some Christian circles consider that the paragraph contained in Luke 6:34-5 as the verses that condemn the practice of taking interest. The verse states: "And if you lend to people, because you hope to get something from it, whether your services? Even sinners lend to sinners, so that they receive back as much. But love your enemies and then do good to them and lend without expecting a reply, then your reward will be great and you will become children of God the Most High, because He is kind toward the people and the ingratitude of the wicked. " paragraph indecision resulted in the emergence of various responses and interpretations of Christian religious leaders about whether or not Christians should practice making flowers. Diverse views among the leaders of the Christian religion can be grouped into three main periods, namely the views of the early Christian pastor (I to XII century), which forbids interest, views of Christian scholars (century XII - XVI) who wish to be allowed to flower, and the views of the reformers Christian (XVI century - in 1836) which causes interest justifies the Christian religion. Deuteronomy 23:20 states:
"From a foreigner you may charge interest, but from your brother, you must not pick flowers ... so the Lord your God bless you in all your efforts in the country that you are entering to possess."
Early views of the Reverend Christian (Century I - XII)
In this period, generally prohibited from taking interest. They refer to issues of interest to capture the Old Testament is also believed by Christians. St. Basil (329-379) consider those who eat the flowers as people who do not speak-humanity. For him, took the flowers are taking advantage of people in need. Similarly, collecting gold and wealth of tears and sorrow of the poor.
St. Gregory of Nyssa (335-395) condemned the practice of interest because he thinks aid through loans were false. At the beginning of the contract, such as helped but at the bill and ask for the interest to act so cruel. St. John Chrysostom (344-407) argues that the prohibition contained in the Old Testament which was addressed to the Jews also applies to adherents of the New Testament. St. Ambrose denounced as a fraud and flower eaters pembelit (moneylenders). St. Augustine believes the application of interest on the poor is more cruel than the robber who robbed the rich. Because both are equally robbed, one of the rich and another for the poor. St. Anselm of Centerbury (1033 - 1109) consider interest equal to the robbery. Ban the practice of interest was also issued by the church in the form of law (Canon): Council of Elvira (Spain in 306) issued the Canon 20 which prohibits church workers practicing taking interest. Whoever violates, then the rank will be reduced. Council of Arles (314 years) issued a Canon 44 which also prohibits the practice of the church workers are taking interest. First Council of Nicaea (325) issued the Canon 17 which threatened to fire workers who practice the church flowers. Prohibition of entry into newly issued common interest to the Council of Vienne (year 1311) which states that whoever considers that interest is something that is not sinful then he has been out of Christians (apostates).
The initial view of the Reverend Christian can be summed up as follows
Flowers are all the forms demanded in return that exceeds the number of items loaned. Taking the interest is a sin that is prohibited, both in the Old Testament and New Testament. Desire or intention to get benefits beyond what lent is a sin. Interest should be returned to its owner. An elevated price for the sale of goods on credit is also a hidden interest.
The Bachelor of Christian views (Ages XII - XVI)
In this period there developed very rapidly in the field of economy and trade. At that time, money and credit became an important element in society. Loan to provide working capital to merchants began rolling at the beginning of XII century. Financial markets slowly start to form. The process encourages the realization of the widespread market interest rates. Christian scholars during this period not only discuss issues of interest solely in moral terms that refer to the verses of the Old Testament and New Testament, they also relate to other aspects. Among others, concerning the type and form of legislation, a person's right to the property, characteristics and meaning of justice, benefit forms, intentions and actions of human beings, as well as the distinction between sins of individuals and groups.
They are deemed to have made new breakthroughs in connection with the definition of interest. From the results of their discussion for the purpose of refining and legitimizing the law, interest is divided into interest and usury. According to them, interest is interest that is allowed, while usury is excessive interest. Proponents of Christian scholars who contributed a huge opinion in connection with this interest is Robert of Courcon (1152-1218), William of Auxxerre (1160-1220), St. Raymond of Pennaforte (1180-1278), St. Bonaventure (1221-1274), and St. Thomas Aquinas (1225-1274). Conclusion of the discussion of Christian scholars such period in connection with the interest rates are as follows: Intention or deeds to gain by giving the loan is a sin that contrary to the concept of justice. Taking the interest of the loan is allowed, but illicit or not depends on the intention of the giver of debt.
The view of the Christian Reformed (XVI Century - Year 1836)
Opinion of the reformers had to change and form a new view of interest. The reformers were, among others, John Calvin (1509-1564), Charles du Moulin (1500 - 1566), Claude Saumaise (1588-1653), Martin Luther (1483-1546), Melanchthon (1497-1560), and Zwingli (1484 -1531).
Some of Calvin's opinions relating to interest, among others:
• Sin when the interest burden.
• Money can flourish (in contrast with Aristotle).
• No interest decision making as a profession.
• Do not take the interest of the poor.
Du Moulin urged that making a simple interest rate is allowed as long as it is used for productive purposes. Saumise, a follower of Calvin, to justify any taking of interest, although he comes from the poor. According to him, selling money with money is like a normal trade, then there is no reason to prohibit people who will use the money to make money. According to him too, religion need not bother to meddle in the affairs relating to the interest.
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