In 2002, Tun Dr Mahathir Mohd outlined a plan for the use of the dinar, a gold coin formerly used in countries of Southwest Asia and northern Africa, for international trade as a way to prevent currency manipulation that sparked off the 1997 Asian financial crisis. He blamed ”greedy” currency traders for impoverishing Asia, said ”With paper currency there is no intrinsic value. The exchange rate is therefore arbitrary and subject to manipulation as we saw during the Asian financial crisis.”
In 2006, I attended the International Islamic Conference in KL and a paper was presented on this gold dinar issue. Tun Dr Mahathir was there as well and the importance of gold in the current economy was reinstated further. Back then, we were contemplating which currency to keep our savings in — SGD, MYR or Euro. However, after the conference, we thought it would do no harm learning more about keeping our assets in gold form instead of cash in the bank. Prior to that conference, years ago I also attended Moulana Imran Hosein’s discourse on similar topic. So we went to learn more about it.
My mother used to tell me that long ago, women saved part of their monthly allowances and bought pieces of gold jewellery and stashed them somewhere. In case anything happened to their marriage or their husbands, they would have reserves to last them for a while before they got back on their feet.
The Chinese community that I lived within and mixed around with, especially those years I was teaching in a Chinese school, have this practice of buying gold bars and keeping them in safe deposits in the banks. I did ask an old Chinese teacher once why she buys a gold bar monthly and she simply told me for ‘investment’. For someone who had lived through the ‘Perang Jepun’ era as a young girl, she explained that in case of emergency or state of war, if she had invested in properties, she cannot ‘carry’ the property and flee. And having seen what happened to the ‘duit pisang zaman Jepun’, she simply didn’t trust paper currency. She told me, with her gold bars, she can go anywhere in the world and it will be accepted as ‘gold’ whereas, she is not sure how far paper currency can bring her in this unpredictable global political era.
Then I also watched a German film ( I cannot remember the title ) some years back on the fall of the Berlin Wall. When East and West Germany became one. What I remembered distinctly about that film was that before the unification happened, East and West Germany each had a different currency. When the unification took place, the Eastern Germans were given a certain period of time to quickly go to the banks and change their currency to then Deutsche Mark. There was this bloke whose mother was in the hospital and they were rich with so much cash stashed at home ( the mother didn’t trust the bank ). A whole suitcase worth of cash in fact. Because his mother was in the hospital, he missed the deadline in changing the old currency into the new one and within just 24 hours, the whole suitcase of riches turned into worthless paper.
As a layman, reflecting through all that gave me the assurance I needed that yes, it does make sense to invest/keep our savings in gold instead of paper currency. And we did just that since two years ago with buying and keeping our gold. Some other info could be found here.
But do be careful when buying Gold Dinars. Do not get conned like our well-meaning friends who bought from their ‘sedara/sahabat handai’ only to find that their gold dinars are not actually gold but gold plated metals. Do your homework well before buying and always insist on certificate of authenticity.
Image taken from here.