May 06, 2012

#Israel has a housing bubble

You may be thinking.... what?

"I've not heard a word about such a thing, or about the Israeli economy in general being in trouble."

You haven't, because
A. The bubble hasn't burst yet, and
B. The mainstream business and political media isn't thinking outside the box enough.

All those houses being built in the occupied West Bank/Palestine? THAT is your Israeli housing bubble.

I think a lot of Israeli politicians know that, and, like Social Security used to be in the U.S., it's the "third rail" of Israeli politics. Even more liberal-party politicians there don't want to touch it at all.

Now, people may not be taking out home equity loans against their new settler homes. But, there's already plenty of largely artificial economic stimulus there.

You have:
A. The housing construction itself;
B. The settler village infrastructure construction, of neighborhood water, sewer, electricity and roads;
C. Municipal/village police, civilian government employees, etc.;
D. The Israeli Army.

Per the overall size of Israel, that's actually probably a pretty damned big bubble.

And, nobody inside the Beltway in the U.S. mentions it, either. Why not? They're probably afraid Israel would ask for even more foreign aid money if the bubble even contracted, let alone burst. And, it's an election year.

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