Conventional finance has long been plagued by crises that cause economic dislocations and impede sustained economic growth, with banks and non-bank financial institutions requiring periodic bailouts.Numerous developing countries have been unable to mobilise domestic and foreign financial resources for development while many advanced countries Dual Inlet 4 Way Water Valve continue to be plagued by recurring financial crises.A number of eminent economists have denounced the shortfalls of conventional banking and have advocated 100% reserve banking as the stable foundation for a financial system, a recommendation that happens to coincide with the Islamic financial system.The Islamic financial system is characterised by a two-tier banking system with 100% reserve deposit system and risk-sharing equity or investment banking akin to a mutual fund, and the prohibition of Outdoor Counter Barstool interest and interest-based transactions.Islamic finance promotes risk sharing and an efficient risk-sharing vehicle would be a stock market that operates along Islamic principles that prohibit interest and interest-based leverage.
JEL codes: P43, G15, Z12 Keywords: Islamic finance, financial stability, interest, risk sharing.