No answers today, just a question. Today's El País is dominated by two "stories", as journalists call them, though neither one has a clear narrative yet. One is the massive bombardment and now invasion of Gaza by the Israelis. The other is the gobal financial crisis. My question: How will these two huge events affect each other? Because in our closely interconnected world, the vibrations of any major shock are felt throughout the network.
There are other big "stories", i.e., events waiting for their narrative. The Russian pressure on the Ukrainians and the constricting of gas pipelines to most of Europe, for example. The big offensive by the government of Sri Lanka, etc. And down through other events whose ripples beyond their own regions may be felt less intensely. But for now let's just look at the first two.
Did the financial pinch have anything to do with the Israeli move against Gaza? War has always proven an excellent distraction from other troubles. And with no economic surplus, what else besides war can the candidates for premier offer to their citizens? The far more severe pinch in Gaza may also have a lot to do with the Hamas government's allowing, or encouraging, reckless and senseless missile attacks on Israeli civilians. People in the strip are so frustrated that they have to lash out at somebody, and Hamas must figure, better the Israelis than us.
And how will this huge escalation of violence affect global finance? Is it going to escalate the already widespread hostility toward Jewish financiers (and toward the far more numerous non-Jewish financiers wrongly suspected of being Jewish, just because they are financiers)? Probably it will, I think, and that is likely to be a pretext for more isolationist, nationalist economic policies by, for example, Muslim countries in Asia (Indonesia among them). Will it make a rapprochement of the U.S. and the Arab countries even more difficult, because of the U.S.'s knee-jerk support of Israel? Almost certainly. And is that going to further limit the U.S.'s power to affect markets?
As I said, no answers, just questions. These are some of the things to watch for, I think. In the long run, I don't think this invasion is good for the Jews or for anybody. Though it might be good for the short run aspirations of some Israeli politicians.
Middle East finance headlines (Financial Times)
Rice cancels Mideast trip to help with financial crisis (CNN)
Turning a crisis into an opportunity. By Nehemia Shtrasler (Haaretz)
Finance Minister: No Israel banks will collapse in global crisis (Haaretz)