Thursday, October 9, 2008

Creating Panic

I haven't yet figured out the reason, but the Israeli media is creating panic about the financial situation.

The United States has a serious problem/recession/depression, but the Israeli economy, amazingly, has been strong. But the Israeli media is trying to change it.

The other night on the TV news, I heard a report about the Israeli stock market dropping. You'd think they were cheering the Israeli National Soccer Team winning the way they talked about the drop. And then a night or two later, they investigated various "home safes," since they told the public that the banks wouldn't be reliable.

Well, if things do get worse, at least we can blame Olmert and Kadima...


Akiva said...

The Israeli stock market has never been a place for the individual investor. Israeli's don't build their retirement through Tel Aviv Stock Market investments, or mutual funds.

BUT, the power elites DO. If I remember correctly from a Globes article in the past, about 5% of Israeli's own 85% of the Tel Aviv market, the other 15% being foreign ownership.

The reporters are reporting on themselves and on the impact to those they look up to in the Tel Aviv towers.

Batya said...

Akiva, good answer. Just now there was a bit on the news. The reporter asked an economist why the Israeli govt isn't interfering, and he insisted that there wasn't a need to.

Akiva said...

The secondary point as well, as you mentioned from your recent interview, the reporters are relatively clueless yet have their agenda.

Panic makes news. Crisis increases viewership. They're certainly not beyond riling up a crisis to up their ratings, even if they don't have a clue on what's going on or not.

If you've been reading on my blog, I've been following this closely. It's even worse than is being reported, but so far Israel's only direct exposure is any local banks or companies that have US investments (rated around $300 million impact to the banks, big but not crushing). The indirect question, and you may be able to help me with this, is what does Israel export and will those markets decrease in a major way? (Vegetables, probably no impact - people always have to eat and it's not a luxury good, military, also probably no impact, as things get unstable militaries even build up. What else?)

Batya said...

Off-hand, I'm not familiar with the export market, and I think more food goes to Europe.
I presume, fewer American tourists and immigrants, not because life is good there, but because the dollar is worthless here.