SPECULATION FORBIDDEN

Muhammad forbids speculation.  �He who buys food grains should not sell it until he has taken possession of it� (3640).  During Muhammad�s own lifetime, as the control of Arabia passed into his hands, his injunctions became state policy.  SAlim b. �Abdullah reports: �I saw people being beaten during the lifetime of Allah�s Messenger in case they bought the food grain in bulk and then sold them at that spot before taking it to their places� (3650).

Because of their speculative nature, Muhammad also disallowed �futures� transactions.  He forbade �selling ahead for years and selling of fruits before they become ripe� (3714).  Transactions with the help of documents (probably the hundior bill of exchange system), were also made unlawful.  The injunction was implemented with the help of the police.  �I saw the sentinels snatching these documents from the people,� reports SulaimAn (3652).

author : ram swarup