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December 19, 2014 / 27 Kislev, 5775
 
At a Glance

Posts Tagged ‘shekel’

Warren Buffet Buys Out Israeli Firm for $2 Billion

Wednesday, May 1st, 2013

Warren Buffett’s Berkshire Hathaway is paying $2.05 billion for the remaining 20 percent of IMC International Metalworking Co, otherwise known as Isracar, completing the buyout that began with the giant $4 billion purchase of 80 percent of the company in 2006.

“We are delighted to acquire the portion of the company that was retained by the Wertheimer family when IMC first became a member of the Berkshire group of companies,” Buffett said Wednesday in a statement.

“As you can surmise from the price we’re paying for the remaining interest, IMC has enjoyed very significant growth over the last seven years,” Buffett, 82, said.

Isracar employs more than 2,000 people in Israel and 7,500 others around the world.

Buffett has literally fallen in love with Israel. The 2006 purchase of most of Isracar was Buffett’s largest-ever investment outside of the United States.

When he visited Israel prior to the spectacular purchase of the precision carbide cutting tools company, he said, “If you’re going to the Middle East to look for oil, you can skip Israel. If you’re looking for brains, look no further. Israel has shown that it has a disproportionate amount of brains and energy.”

Since then, an American-Israeli consortium drilling off the Haifa coast has made the world’s largest discovery of natural gas in the past 20 years, with a strong possibility of commercial quantities of oil.

Buffet’s purchase of the rest of Isracar on Wednesday helped strengthen the shekel against the dollar, with the going rate for a greenback now less than 3.58 shekels.

Next Israel Shekel Bills to Feature Sephardi Jew

Sunday, April 28th, 2013

The Netanyahu government is going “politically correct” and will make sure the next serious of Israel shekel bills will feature a Sephardi Jew following last year’s four new banknotes that featured only Ashkenazi Jews.

Prime Minister Binyamin Netanyahu said on Sunday he personally prefers that the “Sephardi shekel bill” feature poet Rabbi Yehuda HaLevy, calling his poetry “genius.”

Knesset Member Aryeh Deri of the Shas Sephardi religious party sharply criticized the monopoly of Ashkenazi Jews on the most recent series.

“Money adorned with an image of a Mizrahi figure is not worth less,” he said.

The Rambam, Moses Maimonides, was featured on a banknote in 1980 but is only widely-known Sephardic to be seen on Israel money.

Fischer Launches New War on Shekel-Dollar Rate

Monday, April 8th, 2013

Bank of Israel Governor Stanley Fischer launched a new war on the falling shekel-dollar rate Monday and ordered the purchase of $100 million of greenbacks, soon after the rate dropped close to 3.59 shekels to the dollar for the first time in nearly two years.

The massive purchase catapulted the rate from the 18-month low of 3.592 to 3.62 in only a few minutes.

The shekel has strengthened this year, receiving recent support from expectations of positive fallout from the beginning of the flow of Israeli natural off-shore gas.

A strong shekel is great news for consumers buying items imported from the United States, but it sends shivers through Israeli companies with revenues in dollars. After converting income to shekels, the firms are left with less money, and their executives are constantly pressuring the Finance Ministry and the Bank of Israel to take measures to raise the currency rate.

Upside-Down Coffee

Monday, October 22nd, 2012

This is a normal cup of Israeli coffee, the kind you can order practically anywhere. This particular shop, in fact, is usually associated with gas stations. It’s called Kafe Hafuch or Upside-down coffee, the local equivalent of the French café au lait. It goes for between 8 and 14 shekel, or $2 to $3.5.

Here’s the HUGE difference, though, between the average Israeli coffee and its American counterpart: the average, lowly, gas station coffee in Israel beats by far the most expensive coffee shop coffee in New York. I don’t even want to mention a certain Seattle-based coffee shop chain where they burn the coffee so bad you can hear the cries coming up from below the floor boards. I’m talking about every doughnut shop or coffee shop in the city (depending on your kashrut standards, obviously) – in all those places the coffee has usually stood up on the heating pad for half a day, it’s sour and bitter, and you drink it basically for the kick you need so desperately before going into an important meeting.

But in Israel (depending on your kashrut standards, obviously), with very few disappointing exceptions, the coffee is delicious. It has just the right amount of kick, it’s made fresh at the espresso machine, and if you’re lucky the counter person knows how to make those lovely illustrations in the foamy milk that break your heart when you end up drinking their art.

Nancy says it’s all about the milk, meaning that Israeli coffee is, basically half milk, steamed, so no matter how lousy the coffee underneath is, the milk covers it up. Maybe she’s right. Maybe it also explains why I shell out 11 shekel per cup (just under $3), but I’ll tell you, I’m happy to pay knowing my coffee will be good every time.

Except for the guy at the lobby of the Maccabi HMO offices in Netanya, whose coffee is bitter. So stay away from coffee shops in HMO buildings, otherwise, trust me, Israeli coffee is the best.

Shekel Up Against Dollar Post-Rosh Hashanah

Wednesday, September 19th, 2012

The shekel strengthened against the dollar and euro in trading after the Rosh Hashana holiday.  Tel Aviv’s foreign currency exchange market was closed Monday and Tuesday for the Jewish New Year.

In trading on Wednesday morning, the shekel-dollar rate dropped by 0.38% to 3.895 shekels to the dollar.

The Euro also strengthened against the dollar to $1.308 to the euro following a four-month low by the dollar against the euro last week.

Netanyahu Releases 250 Million Shekel Advance to PA

Wednesday, September 12th, 2012

After consulting with Finance Minister Yuval Steinitz, Prime Minister Binyamin Netanyahu released on Tuesday a 250 million shekel advance to the Palestinian Authority, due to concerns that public Arab protests against the PA may lead to anarchy in Judea and Samaria.

The money will be used to shore PA President Mahmoud Abbas’s government, and will be funneled into the various departments by PA Prime Minister Salam Fayyad.

Reports indicate that the PA is still in arrears of payment to the Israel Electric Company by 700 million shekels.

The majority of aid to the Palestinian Authority comes from the United States and European Union. Only 22 percent of the PA’s funding came from Arab donors in 2010.

Europe’s Financial Crisis Weighs on Israel’s Economic Outlook

Monday, July 23rd, 2012

The austerity package passed by Spain’s parliament last Thursday has done little to calm economic jitters worldwide, with the effects being felt in Israel as the Bank of Israel (BoI) is set to decide today whether to lower its key interest rate for a second straight month.

Spanish Prime Minister Mariano Rajoy’s conservative People’s Party pushed through the controversial plan to cut state spending by some $80 billion, despite stiff resistance from opposition parties. The package includes a rise in the Value-Added Tax (VAT) rate from 18 percent to 21 percent and the reduction of unemployment benefits. Spain is struggling with an unemployment rate of around 25%, and has sought to ease its banking crisis by obtaining a bailout from the Eurozone.

On the same day that the austerity package was passed, German parliament approved an aid package for the Spanish banking sector worth approximately $146 billion. Many commentators in Germany expressed concern over the utility of another bailout. German daily Frankfurter Allgemeine Zeitung commented: “The reality is that Spain is getting aid with loosened conditions. Soon Italy will ask, too. And the other reality is that, instead of investors, once again (mainly German) taxpayers will have to pay for the faulty speculation of banks.”

In Israel, the opening of the trading week on Monday morning saw the shekel-dollar exchange rate crossing the NIS 4/$1 line. The current shekel-dollar rate is at a three-year high, while the shekel-euro rate is 0.68% lower, at NIS 4.8705/€1. Later on Monday, the BoI is expected to announce its key interest rate for August, with some analysts speculating that the rate will be lowered for a second straight month, from 2.25% to 2%. Last month, the BoI cut the rate from 2.5% to its current rate.

Moti Bassok and Ram Ozeri, writing in Haaretz, explained that while a cheaper shekel makes Israeli imports more enticing, lower interest rates diminish foreign demand for shekel-based investments – which in turn tends to lower the shekel’s value. Supporters of an interest rate cut cite recent slower economic growth and weak foreign trade figures. The recent performance of Spanish government bonds have heightened fears that Spain will require much more assistance than last week’s $146 billion bailout, and Spain’s fiscal difficulties are causing the Euro to tumble, reaching a new low of approximately $1.2083/€1.

Israel is watching the continuing European debt crisis warily, as the European Union is Israel’s top trading partner. But despite Europe’s economic woes and trepidation in Israel, the EU is set to intensify relations with Israel by approving up to 60 new cooperative initiatives, according to AFP.

The initiatives are expected to be endorsed on Tuesday at the the annual Israel-EU Association Council meetings in Brussels. Predictably, they are sparking indignation from certain corners, as they come only two months after the EU’s statement condemning Israel for actions that “threaten to make a two-state solution impossible” – ie. settlement building, “settler extremism,” and “provocations against Palestinian civilians.”

According to AFP, the initiatives will include heightened cooperation in the energy and transportation sectors, and more closely-coordinated relations with a variety of EU agencies.

A European diplomat, speaking to AFP on condition of anonymity, was critical of increasing bilateral relations, saying: “Once again we’re hearing critical words on the one hand but it’s business as usual on the other…EU statements on the peace process are no more than theatre.”

Paul Hirschson, deputy spokesman at Israel’s foreign ministry, pointed out that the increased cooperation “is related to the existing work plan rather than some sort of upgrade, because that way the EU would have to find a way of delinking it from the peace process.”

In 2008, Israel’s attempt to enhance ties with the EU was stifled when the bloc suspended discussions because of Israel’s offensive against the Hamas regime in Gaza. It thereafter declared that any progress in bilateral relations would be conditional on progress in the Middle East peace process.

Israeli Foreign Minister Avigdor Liberman left for Brussels on Monday and will be attending a meeting of the Israel-EU Association Council.

Printed from: http://www.jewishpress.com/news/israel/europes-financial-crisis-weigh-on-israels-economic-outlook/2012/07/23/

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