In the past few months, Minister of Finance Yair Lapid has repeatedly said “what was will no longer be”, and that he would make many changes for the good of the public in general and for the middle class in particular. In witness whereof an animated series “The Polish women are going to market” has gone on the air to teach us how and where to invest our money. The cartoon ads by the famed Polish characters Tula and Bezhezhina from the comedy series Zehu Zeh (“This is it”) talk to the middle class who have received unexpected money and are looking for a place to invest it. It should happen to us all.
In addition to the question about the message that these shows want to send us in more than seven minutes (a long time in marketing terms), there is the question what is so urgent in launching this campaign right now. The headlines in the financial press this year have reported a plunge in trading volumes on the Tel Aviv Stock Exchange (TASE) (albeit there has been some recovery lately), the resignations of the TASE CEO and chairman in quick succession, a new low in the corporate bond market, and numerous debt settlements. After a period without good news, it is possible to understand why it was so important to invest in a positive message, even if it has no basis in reality or the newspaper headlines.
The painful truth is that the Israeli capital market is in a deep slump, but this has not prevented the Ministry of Finance’s Capital Market, Insurance and Savings Department from recommending in educational ads that investing in short-term deposits, stocks, foreign currency, exchange traded funds (ETFs), and mutual funds traditional investment channels that do not really work for the middle class, and which in addition usually have modest returns even as their soundness is not as certain as it once was.
There are alternatives in the investment market. Those of us who investigate and search discover other options: foreign currency markets, options and derivatives, farmland for redevelopment, and now the Bitcoin the new Internet gold. The problem is that these are unsupervised speculative investment instruments, and their marketers often use the hard sell and conceal important details about the investor’s security. Often, there is insufficient information about them that will help the average investor to make a right calculation.
Bottom line, instead of investing resources in maintaining the existing situation, it would be better for the government to use them to change it. They have already shown that they know how to and can make changes at lightening speed. Look at the change in the name of the Ministry of Industry, Trade and Labor to honor Minister Naftali Bennett. The decision-makers in Jerusalem should know that the public’s attitude toward the TASE and the capital market is one of distrust; an attitude that cannot be solved by a media campaign.
You, the economy’s leaders, have real influence on legislative processes that will change something at the Israel Securities Authority. Only easing regulations and adapting them to the 21st century will allow new players and new rules of game enter the investments arena.
Amir Bramly is the chairman and CEO of Rubicon Business Group
Published by Globes [online], Israel business news - www.globes-online.com - on December 8, 2013
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