Investment House Criticized for Politically Biased Election Forecast
Translated & summarized from Makor Rishon by baba
An investment house, IBI, has been criticized for publishing a politically biased election forecast that favors the left-wing "change bloc." The analysis, which suggests a left-wing victory would boost Israel's economy and stock market, is described as resembling a political platform rather than professional advice. The article contrasts IBI's view with market performance, noting the Tel Aviv 35 index saw significantly greater gains under the current government than during the previous "change government."
The story in 5 lines · by baba
- Investment house IBI published a politically biased election forecast favoring the left-wing "change bloc."
- The forecast claims a left-wing victory would improve Israel's economy and stock market.
- The article criticizes the analysis for resembling a political platform more than professional advice.
- IBI's view that political chaos benefits markets contradicts analyst consensus.
- The Tel Aviv 35 index rose over 120% under the current government, versus 6% under the "change government."
Ahead of upcoming elections, financial institutions and prominent figures in the capital market are again voicing political opinions, a phenomenon also observed during the judicial reform period. During that time, "experts" presented dire economic and capital market forecasts for Israel, with some encouraging investors to withdraw funds unless the government aligned with their political agenda. However, these predictions largely failed to materialize, and those who heeded them reportedly suffered financial losses.
This week, the investment house IBI published an extensive analysis for the elections, outlining expected impacts based on key outcomes: a change in government, the continuation of the current coalition, or political instability. The analysis's core message, according to the report, is that only a vote for the left-wing "change bloc" will improve macroeconomic indicators, boost the stock market, and strengthen the shekel.
The article criticizes IBI's report, stating it resembles a political platform more than a professional analysis, and questions the assertion that left-wing parties are economic saviors. It notes that IBI's view, which suggests political chaos might be more beneficial to capital markets than a stable national government, contradicts the consensus among analysts that a stable coalition is more important than the government's specific political makeup.
The author expresses discomfort with a large financial institution managing public funds issuing such a biased report, questioning its general judgment and investment decision-making processes. As a counterpoint, the article highlights that the Tel Aviv 35 index rose approximately 6% during the "change government" period, compared to over 120% under the current government, suggesting the latter has been far more beneficial for the stock market.
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