16,374
edits
Taking Interest: Difference between revisions
From Halachipedia
→Lending Commodities for Other Commodities
| Line 72: | Line 72: | ||
# It is Biblically forbidden to lend an item for a greater quantity of that item. For example, lending 100 apples for 120 apples is Biblical interest.<ref>Shulchan Aruch YD 160:21</ref> | # It is Biblically forbidden to lend an item for a greater quantity of that item. For example, lending 100 apples for 120 apples is Biblical interest.<ref>Shulchan Aruch YD 160:21</ref> | ||
# Short selling is a violation of borrowing commodities with interest. This type of transaction between two Jews is forbidden since the leniencies of borrowing commodities, namely, having a fixed market price that endures for a long time or having a position in that the stock one is short selling, are inapplicable.<ref>[https://traditiononline.org/short-selling-and-jewish-law/ Rav Aharon Levine (Tradition Spring 2010 pp. 67-71)] explains that short selling involves borrowing a commodity which is repaid with that commodity and not merely a cash loan. The commodities in this case are the stocks being sold short. Since the marketplace price is in flux constantly that doesn't permit the seah b'seah transaction. Additionally, the fact that selling outside the box is illegal prevents a person from shorting a position he already owns stock in. Therefore, it isn't possible for someone to have the stocks that he is borrowing while doing a short sell.</ref> For a Jewish marketplace this is a serious issue because either way there is an interest charge for borrowing the stocks for the time. Therefore, these issues need to be solved with a heter iska.<ref> [https://www.toraland.org.il/%D7%A9%D7%90%D7%9C%D7%95%D7%AA-%D7%95%D7%AA%D7%A9%D7%95%D7%91%D7%95%D7%AA/%D7%9B%D7%9C%D7%9B%D7%9C%D7%94-%D7%95%D7%9E%D7%A9%D7%A4%D7%98/%D7%9B%D7%9C%D7%9B%D7%9C%D7%94-%D7%95%D7%94%D7%9C%D7%9B%D7%94/%D7%9E%D7%9B%D7%99%D7%A8%D7%94-%D7%91%D7%97%D7%A1%D7%A8/ toraland.org.il] cites Torat Ribbit 17:33 that since stocks don't represent ownership of the company it isn't considered ribbit or seah bseah. However, since there's a payment of interest for the value of the stocks that is certainly considered interest and requires a heter iska.</ref> | # Short selling is a violation of borrowing commodities with interest. This type of transaction between two Jews is forbidden since the leniencies of borrowing commodities, namely, having a fixed market price that endures for a long time or having a position in that the stock one is short selling, are inapplicable.<ref>[https://traditiononline.org/short-selling-and-jewish-law/ Rav Aharon Levine (Tradition Spring 2010 pp. 67-71)] explains that short selling involves borrowing a commodity which is repaid with that commodity and not merely a cash loan. The commodities in this case are the stocks being sold short. Since the marketplace price is in flux constantly that doesn't permit the seah b'seah transaction. Additionally, the fact that selling outside the box is illegal prevents a person from shorting a position he already owns stock in. Therefore, it isn't possible for someone to have the stocks that he is borrowing while doing a short sell.</ref> For a Jewish marketplace this is a serious issue because either way there is an interest charge for borrowing the stocks for the time. Therefore, these issues need to be solved with a heter iska.<ref> [https://www.toraland.org.il/%D7%A9%D7%90%D7%9C%D7%95%D7%AA-%D7%95%D7%AA%D7%A9%D7%95%D7%91%D7%95%D7%AA/%D7%9B%D7%9C%D7%9B%D7%9C%D7%94-%D7%95%D7%9E%D7%A9%D7%A4%D7%98/%D7%9B%D7%9C%D7%9B%D7%9C%D7%94-%D7%95%D7%94%D7%9C%D7%9B%D7%94/%D7%9E%D7%9B%D7%99%D7%A8%D7%94-%D7%91%D7%97%D7%A1%D7%A8/ toraland.org.il] cites Torat Ribbit 17:33 that since stocks don't represent ownership of the company it isn't considered ribbit or seah bseah. However, since there's a payment of interest for the value of the stocks that is certainly considered interest and requires a heter iska.</ref> | ||
# It is forbidden to lend an item to get back the same type of item. This is called ''Seah B'seah''. For example, lending out a 5 pound bag of flour to get back another bag of flour is forbidden.<ref>Bava Metsia 75a</ref> | |||
# This type of rabbinic ribbit is permitted if the borrower has some of the same type of the item he is borrowing. For example, if someone has one egg and wants to borrow five more eggs they can do so since they already have one.<ref>Bava Metsia 75a</ref> | |||
# Some poskim hold that it is permitted to lend an item that is small or cheap and people wouldn't care about the fluctuation in the price such as lending a loaf of bread.<ref>Rama 162:1, Yalkut Yosef CM 159:18</ref> | |||
# It is forbidden even if one uses the language of selling them an item and the buyer will later sell back that item since the price might fluctuate in between and it is like a loan and not two sales.<ref>Taz 160:1 permits seah bseah when the language of sales is employed. Chelkat Binyamin 162:2 writes that many argue with the Taz.</ref> | |||
===Yesh Lo=== | ===Yesh Lo=== | ||
# If a person owns some of the commodity that he is borrowing he can borrow as much as he wants and it is like he sold the lender his commodity. It works even if the borrower only has a little bit of that commodity since it is like he borrowed it several times each time selling to the lender his commodity. It is permitted to do such a loan all at one time.<ref>Gemara Bava Metsia 75a, Shulchan Aruch 160:2</ref> | # If a person owns some of the commodity that he is borrowing he can borrow as much as he wants and it is like he sold the lender his commodity. It works even if the borrower only has a little bit of that commodity since it is like he borrowed it several times each time selling to the lender his commodity. It is permitted to do such a loan all at one time.<ref>Gemara Bava Metsia 75a, Shulchan Aruch 160:2</ref> | ||
