Free market madness and human nature presented at Harvard University. The presentation is about 2008 financial crisis and human nature.

1. Free Market Madness & Human Nature: Can Islamic Finance Help? Necati Aydin, Ph.D. Director of Neuroeconomics and Well-being Program Florida State University, Tallahassee, FL Email: [email_address] or [email_address] Ninth Harvard University Forum on Islamic Finance Building Bridges Across Financial Communities March 27-28, 2010 Harvard Law School Cambridge, Massachusetts

3. Source: The Industrial Workers of the World (IWW)

8. “ Free Market Madness” and Animal Spirits "Most, probably, of our decisions to do something positive, the full consequences of which will be drawn out over many days to come, can only be taken as the result of animal spirits - a spontaneous urge to action rather than inaction, and not as the outcome of a weighted average of quantitative benefits multiplied by quantitative probabilities." (John Keynes, 1936, pp. 161-162) “ The cause of our economic despair, however, is human nature ’s propensity to sway from fear to euphoria and back, a condition that no economic paradigm has proved capable of suppressing without severe hardship .” Alan Greenspan, 2008 “ I made a mistake ," Greenspan said to the House Committee on Oversight and Government Reform, "in presuming that the self-interests of organizations, specifically banks and others, were such as that they were best capable of protecting their own shareholders and their equity in the firms" (The Washington Post, 2008)

16. Self Empowered Transformed Humangod Master and owner Shirk (partnership with God) Capitalism Self Weakened Trained Servant to God Servant and trustee Shukr (giving thanks to God) Islam

18. Sensual pleasures Self-acceptance pleasures Social pleasures Emotional pleasures Intellectual pleasures Aesthetical pleasures Conscience pleasures Altruistic pleasures Spiritual pleasures Egoistic pleasures

19. Materialism/ capitalism serves The elephant The guard Sensual and egoistic pleasures Unsustainable consumption and Destructive technology Islam serves The king The judge The advisor Spiritual and intellectual pleasure Sustainable consumption and constructive technology