Can We Handle Different Futures?

Interestingly enough, a pregnant woman usually notices other pregnant women around her, and divorcees easily spot those who have shared similar experiences as they have. Furthermore, at a time of financial crises, one will naturally seek and find those who are undergoing likewise occurrences. I relate to this notion as “empathy by affiliation.”

The so called “pessimistic views” of the future, are condemned and outcasted, because they threaten the livelihood, comfort and safety of us all. I for one, believe in the cyclical nature of life; all that declines will eventually rise, and vice versa. The critical component is time. No one, even the most brilliant futurist on earth, is able to foretell the future. The best he or she can do is to predict and risk the possibility of being wrong. I will kindly suggest that a “prediction” of a future event should be accompanied by an idea; A possible action, prevention or confrontation.

Some of you have read my notes regarding my parents’ stories dealing with the Holocaust. You may have also seen what I wrote along with my dear friend Professor Shlomo Maital on the financial crisis about to come (February 2006). There is a natural tendency for human beings to be afraid of the unknown especially if it represents a deviation from our day to day comfort zones. Even so, I would like to risk it, and share some of the events which could happen, in my humble opinion, sooner than later.


Israel is doing well by all economic measures. Israelis have good reasons to be proud. The Shekel is one of the strongest currencies in the world. The Governor of the Bank of Israel, Professor Stanley Fischer, runs the country’s financial structure with strength and determination. Relatively, the streets are safe, due to the wall built between the major Palestinian population and Israel, and crime over the last three years has gone down significantly.

So what’s wrong?! I call it big time denial. We are living in the glory of the past without respecting the hazards of the future. Relative safety? In September, 163 countries are likely to vote for an independent Palestinian state. Some of my distinguished business associates, say that if it happens, it will represent the beginning of the “South Africanization” of the country. Embargo and various economic burdens will be placed on this beloved country and things will change drastically. We can give numerous excuses with the reasoning of Antisemitism but at the end of the day, the world will not like Israel ignoring the United Nation’s decision.

The Israeli high-tech, is the engine of growth of the country. Is that still so? Some of the most prominent economists of the country are expressing their thoughts about the high-tech death. I wouldn’t go that far, but I would agree that to some extent, the high-tech industry as a whole is frozen (IAI, Elbit, Intel and Rafael account for 44% of Israel’s high-tech exports, or $8.020 billion, which is nonequivalent to any other nation) and several other small companies are on their way down or out.

The best real-estate market in the world. Well, I can argue against this until I become blue in the face. Yes, we have done outstandingly well and properties have tripled and quadrupled in value. But, why is Professor Fischer so worried about the real-estate bubble? Simply because he saw what happened in the US during the golden times, when mortgages were offered to all. We are reaching a substantially dangerous position in Israel whereas interest rates will increase and the monthly amount borrowers would need to repay will be unbearable.

So assuming that I am right and the events I have described above really “do happen,” what can we do to prevent them? Well, there are lots of smart and knowledgeable statesmen as well as bankers around. But, as an observer, I would do the following: If I were the Israeli Prime Minister, I would react publicly to the Saudi peace initiative which was left without a response for several years. I would not wait for the United Nations to declare a Palestinian State but rather would initiate it myself while conditioning loudly that there will be no talks should the Hamas not recognize the right of the State of Israel to exist. Mortgage crisis, high-tech? To start with, I would follow and bless all the tough measures taken by Professor Stanley Fischer and increase the debt equity ratio on loans. Secondly, in the “Start-up Nation” where new ideas and companies are formed daily, I would establish larger funds and government support to initiate and help start-ups of all sorts (including the traditional industry) so that in the future we will not need to lean on the old high-tech scene.

If you were in the future and you would have had specific data on the events which happened in the past, wouldn’t you utilize them to your benefit once you came back to the present? If that’s the case, why not look into scenarios as though they already happened? It would be so much easier to confront the present while being realistic and open to a different future.