Superphysics
The Kinds Of Commerce
7 minutes • 1434 words
Table of contents
Commerce is the attempt to make a profit by increasing capital through buying goods at a low price and selling them at a high price, whether these goods consist of slaves, grain, animals, weapons, or clothing material.
The accrued amount is called “profit” (riba). Great profits are acquired by:
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Storing goods until the market has fluctuated from low prices to high prices.
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Transporting goods to another country where they are more in demand.
An old merchant said to a person who wanted to find out the truth about commerce:
10. The Transportation Of Goods By Merchants
The merchant who knows his business will travel only with such goods as are generally needed by rich and poor, rulers and commoners alike. General need makes for a large demand for his goods.
If he restricts his goods to those needed only by a few (people), it may be impossible for him to sell them, since these few may for some reason find it difficult to buy them.
Then, his business would slump, and he would make no profit.
A merchant who travels with needed goods should do so only with medium quality goods. The best quality of any type of goods is restricted to wealthy people and the entourage of the ruler.
They are very few in number.
The medium quality of anything is what suits most people. This should by all means be kept in mind by the merchant, because it makes the difference between selling his goods and not selling them.
It is more profitable for the merchant’s enterprise, and a better guarantee (that he will be able to take advantage of) market fluctuations, if he brings goods from a country that is far away and where there is danger on the road.
In such a case, the goods transported will be few and rare, because the place where they come from is far away or because the road over which they come is beset with perils, so that there are few who would bring them, and they are very rare.
When goods are few and rare, their prices go up. On the other hand, when the country is near and the road safe for traveling, there will be many to transport the goods. Thus, they will be found in large quantities, and the prices will go down.
Therefore, the merchants who dare to enter the Sudan country are the most prosperous and wealthy of all people. The distance and the difficulty of the road they travel are great. They have to cross a difficult desert which is made (almost)inaccessible by fear (of danger) and beset by (the danger of) thirst.
Water is found there only in a few wellknown spots to which caravan guides lead the way. The distance of this road is braved only by a very few people. Therefore, the goods of the Sudan country are found only in small quantities among us, and they are particularly expensive.
The same applies to our goods among them. Thus, merchandise becomes more valuable when merchants transport it from one country to another.
Merchants who do so quickly get rich and wealthy. The same applies to merchants who travel from our country to the East, also because of the great distance to be traversed.
On the other hand, those who travel back and forth between the cities and countries of one particular region earn little and make a very small profit, because their goods are available in large quantities and there is a great number of merchants who travel with them.
11. Hoarding
Intelligent and experienced people in the cities know that:
- it is inauspicious to hoard grain and to wait for high prices
- the profit expected may be spoiled or lost through hoarding.
The reason may perhaps lie in the facts that
People need food. They are forced to spend money on it.
Therefore, their souls continue to cling to their money.
The fact that souls cling to what is theirs may be an important factor in bringing bad luck to the person who takes (someone’s money) giving nothing in return.
This is what Muhammad meant when he speaks about taking people’s property for nothing.
In this case, it is not a question of (taking money) giving nothing in return.
Still, people cling to the money spent for food. They had to spend it and had no possible excuse, which is a sort of compulsion.
For things that are traded, other than foodstuffs and victuals, people have no compelling need. It is merely the diversification of desires that calls their attention to them.
On such, they spend their money voluntarily and willingly. They retain no hankering after paying money. Thus, the hoarder is persecuted by the combined psychic powers of the people whose money he takes away.
Therefore, he loses his profit.
Our teacher Abu ‘Abdallah al-Abili told me an interesting story about a shaykh of the Maghrib:
I was in the house of the jurist Abu1-Hasan al-Malili. he was the chief judge of Fez, in the time of Sultan Abu Sa`id.
He had just been offered, as his salary, the choice of one of the various sorts of taxes that were collected by the government.
The judge reflected a while and said ‘The customs duties on wine.’
His friends were astonished and asked why he chose those.
He replied: ‘All tax money is forbidden. Therefore, I choose the tax that is not haunted by the souls of those who had to pay it. Rarely would anybody spend his money on wine unless he were gay and happy with the experience of drinking wine. His soul, therefore, does not cling to the money he has had to spend."
This is a remarkable observation.
12. Low Prices Are Harmful To Merchants Who, Have To Trade At Low Prices
This is because profit and livelihood result from the crafts or from commerce.
Commerce means the buying of merchandise and goods, storing them, and waiting until fluctuation of the market brings about an increase in the prices of (these goods).
This is called profit (ribh).
It provides a profit (kasb) and a livelihood for professional traders.
When the prices of any type of goods, victuals, clothing material, or anything else that may bring in capital, remain low and the merchant cannot profit from any fluctuation of the market affecting these things, his profit and gain stop if the situation goes on for a long period.
Business in this line of goods slumps. The merchant has nothing but trouble.
No trading will be done. The merchants lose their capital.
This is seen in grain.
While it remains cheap, the farmers and grain producers are adversely affected. Their profit is small, insignificant, or non-existent.
They cannot increase their capital, or they find the increase to be small.
They have to spend their capital. Their condition is adversely affected, and they are reduced to poverty and indigence.
This then, in turn, affects the condition of millers, bakers, and all the other occupations that are connected with grain from the time it is sown to the time it can be eaten.
Likewise, the condition of soldiers is adversely affected. Their sustenance is provided by the ruler in the form of grain from farmers, through the grant of fiefs.
Thus, when the prices of agricultural products are low:
- taxation revenue is small
- soldiers are unable to render military service
The ruler discontinues their sustenance and their condition is adversely affected.
When the prices of sugar and honey remain low, everything connected with these commodities is adversely affected. The merchants who deal in it stop trading.
The same is the case with clothing (material), while prices remain low.
Thus, prices that are too low destroy the livelihood of the merchant who trades in any particular type of low-priced (merchandise).
The same applies to prices that are too high.
Occasionally and rarely, they may bring an increase in capital as a result of hoarding some particular merchandise and the large profit that goes with hoarding, but it is medium prices and rapid fluctuations of the market that provide people with their livelihood and profit.
This insight has a bearing on customs established among civilized people.
Low prices for grain are praised because everyone needs grain.
Dependent people constitute the majority of people in civilization.
Therefore, low prices for foodstuffs are of general usefulness, and food, (at least) as far as this particular kind of food (namely, grain) is concerned, weighs more heavily than commerce.
