Israeli aggression driving global recession, Wall Street giants say

By Al Mayadeen English
Source: Sunday Times
6 Nov 2023 10:37
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The Israeli aggression on Gaza has had far-reaching effects on the occupation's economy, as well as the global economy, as uncertainty looms.

Israeli Prime Minister Benjamin Netanyahu gives an address at the London Stock Exchange in the City of London, United Kingdom, November 2, 2017 (AP)

Ongoing and wide-ranging confrontations in the Middle East could set in motion a global recession, two of Wall Street's biggest names have warned.

Larry Fink, the chief executive of Blackrock, the world's largest asset manager, stressed that geopolitical instability will lead to a withdrawal in consumption, aggravating the risk of European and American recession.

"Geopolitical risk is a major component in shaping all our lives. We are having rising fear throughout the world, and less hope," Fink explained to the Sunday Times.

Fink pointed to the Israeli aggression on the Gaza Strip and the war in Ukraine as two of the main factors that have influenced the global economy.

"Rising fear creates a withdrawal from consumption or spending more. So fear creates recessions in the long run, and if we continue to have rising fear, the probability of a European recession grows and the probability of a US recession grows."

On his part, Jamie Dimon, the chair of JP Morgan, the United States' largest bank, pointed to the Sunday Times the same factors, saying that they were "quite scary and unpredictable."

"What’s happening on the geopolitical front right now is the most important thing for the future of the world – freedom, democracy, food, energy, immigration," Dimon asserted.

Earlier, Dimon had claimed that this is "the most dangerous time the world has seen in decades," as the realization of potential conflicts in the Middle East draws closer, due to "Israel's" brutal policies.

The financier said escalation could have "far-reaching impacts" on energy prices, food costs, and international trade.

'Israel' breaks its own economy

Earlier this month, Israeli media reports confirmed that the occupation's Tamar gas field had been shut down soon after the launch of Operation Al-Aqsa Flood on October 7.

The field, located 80 kilometers off the coast of occupied Haifa in Palestine, did not have sufficient protection in case of potential attacks.

Israeli website, Calcalist, underscored that "the billions spent by the state ("Israel") on defense do not provide the goods, and a flare-up in the northern arena could also disable Leviathan," one of the largest gas fields in the eastern Mediterranean located 47 kilometers to the southwest of Tamar.

"Israel's" continued aggression on the Gaza Strip has also led to a sharp decrease in the occupation's gas exports to Egypt for refinement. According to Calcalist, "Gas exports to Egypt dropped by about 70% during the war."

On a macro level, Israeli companies experienced a significant drop of 50% in total revenues since October 7. Notably, the construction and food services sectors were the hardest hit, with more than 70% of the surveyed companies reporting a revenue decrease of over 70%.

The construction sector, heavily reliant on Palestinian labor, suffered a severe blow, particularly due to the restriction on Palestinian entry into occupied territories from the West Bank and the Gaza Strip.

The occupation's economic crisis is expected to deepen in the future, as vital sectors, including tourism, trade, construction, and energy exploitation, continue to take major blows amid continued retaliatory attacks from the Gaza Strip, Yemen, Lebanon, and Iraq.