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October 17, 2008


Frank H Little

Justin Urquhart-Stewart (Seven Investment Management) predicted the other week a return to "Quaker banking"!

Bob B

For the Christian churches, New Testament advice on investment principles is clearly set out in: Matthew 25: 14-30

14 For it is like a man going on a journey, who summoned his slaves and entrusted his property to them.
15 To one he gave five talents, to another two, and to another one, each according to his ability. Then he went on his journey.
16 The one who had received five talents went off right away and put his money to work and gained five more.
17 In the same way, the one who had two gained two more.
18 But the one who had received one talent went out and dug a hole in the ground and hid his master’s money in it.
19 After a long time, the master of those slaves came and settled his accounts with them. 20 The one who had received the five talents came and brought five more, saying, ‘Sir, you entrusted me with five talents. See, I have gained five more.’
21 His master answered, ‘Well done, good and faithful slave! You have been faithful in a few things. I will put you in charge of many things. Enter into the joy of your master.’
22 The one with the two talents also came and said, ‘Sir, you entrusted two talents to me. See, I have gained two more.’
23 His master answered, ‘Well done, good and faithful slave! You have been faithful with a few things. I will put you in charge of many things. Enter into the joy of your master.’ 24 Then the one who had received the one talent came and said, ‘Sir, I knew that you were a hard man, harvesting where you did not sow, and gathering where you did not scatter seed,
25 so I was afraid, and I went and hid your talent in the ground. See, you have what is yours.’
26 But his master answered, ‘Evil and lazy slave! So you knew that I harvest where I didn’t sow and gather where I didn’t scatter?
27 Then you should have deposited my money with the bankers, and on my return I would have received my money back with interest!
28 Therefore take the talent from him and give it to the one who has ten.
29 For the one who has will be given more, and he will have more than enough. But the one who does not have, even what he has will be taken from him.
30 And throw that worthless slave into the outer darkness, where there will be weeping and gnashing of teeth’”


Both Jesus & Muhammad taught things which are incompatible with modern economics. Jesus said "take no thought for the morrow" - which may sound like an endorsement of recent banking behaviour, but is incompatible with any prudent long-term investment strategy. Islam forbids anything based on the "time value of money". "Islamic banking" is an oxymoron. I once read a long study by a Turkish economist which showed that ALL "Sharia banking" is actually "haram". The point of Islamic banks is to quarantine wealth, to ensure that only Muslims and not infidels benefit from the circulation of Muslim money.


"Brian Osoba has shown (pdf) that people who are risk-averse are significantly more likely to be religious than others; this might be because they look to the Church as comfort against their fear of uncertainty"

Isn't that precisely the opposite of one of Dawkins's claims about religion?

chris strange

Perhaps their religiosity follows the investment strategy rather than the other way around. In their investments they go for lower risk options reducing the potential maximum payoff but minimising their maximum exposure. Perhaps the same with their religious choice and they are simply following the logic of Pascal's Wager?

There is a test to see if this is the case, if they are following Pascal's Wager then there will be a general trend to be followers of the religion with the worst Hell, since not escaping this represents the maximum loss. If they choose Christianity at all these investors with this low risk profile would therefore more likely follow the 'fire and brimstone' brands of Christianity than the 'beard and sandals' versions. Or they could be Satanists, as the prospect of an eternity with Cliff Richard as the only singer available must surely be close to anybody's version of the worst possible Hell.

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