We’ve grown accustomed to small, short conflicts that barely touch the economy. Next time around, war with Hezbollah is likely to hurt
Maybe that explains why even though many experts warn the risk of conflict with Hezbollah is greater than any time in years, neither investors nor business people seem to be giving the thought the slightest attention. The Tel Aviv Stock Exchange’s TA-35 index of large-caps has fallen 2% in the past month, but that’s mainly due to Teva Pharmaceuticals’ woes. The shekel, meanwhile, has strengthened against the dollar.
That nonchalance is based on a scenario that is no longer valid.
But the situation now is unusually tense. The resignation of Lebanese Prime Minister Saad Hariri is shaking Lebanese politics and signals a new Saudi willingness to take on Iran with results that no one can predict. Iran is moving to enhance its military position in Syria, including plans to build air and naval installations there that Israel sees as an existential threat. Syria itself has grown more obstreperous about Israeli raids. The conditions are all there for one of the parties to make a wrong move and set off a war no one wants, that everyone will pay for dearly.