Lev Leviev 88 224.
(photo credit: Ariel Jerozolimski)
The biggest news Lev Leviev made this year, prior to the financial crisis of the past month, came last winter when he dropped Israel as his primary residence and relocated to a new, $70 million home in London's upscale Hampstead neighborhood.
An undercurrent of disapproval ran through the local coverage of Leviev's London move - perhaps because it seemed to underline the fact that Israel had become too little for the Uzbekistan-born $6 billion man, and he now required a bigger and grander stage befitting his position as the head of a burgeoning global real-estate-and-diamond empire.
Alas, it now seems Leviev's extensive foreign investments, especially in the distressed US and Russian real-estate markets, have in the past few months gone from being proof positive of his financial prowess to an increasingly heavy millstone around the neck of his shaken business empire.
Maybe that's why the manner in which Yediot Aharanot and Ma'ariv trumpeted on the front pages of their weekend editions the extent of Leviev's losses - along with those of Shari Arison, Nochi Danker, Yitzhak Tshuva and the Ofer brothers - seemed to go beyond mere economic reporting. It was hard not to read a touch of schadenfreude in the manner the tabloids chose to proclaim that Leviev's paper worth had dropped an estimated NIS 18b. over the past few weeks, putting him seriously out of pocket.
"Big losers" headlined Yediot about Leviev and his fellow moguls, as if to say: "Think you're too big for Israel, you global wheeler-dealers? Well, now it's your turn to get cut down a little."
Such sentiments, though, are likely to be double-edged. Economists sometimes speak of a "trickle-down theory" in which increased riches for the already wealthy are viewed as beneficial for all, since in an open economy some of that money will eventually filter down in the form of consumer spending and equity investment to the middle and working classes. Whether one buys that proposition depends in large degree on one's political perspective.
A less contentious claim is that "trickle-down economics" is also applicable in bad times - when the wealthy, especially captains of industry, are feeling the pinch, it's likely those hardships will soon be felt throughout the entire economic sphere.
When the financial bailout package ran into opposition last week in the US Congress, its supporters stressed to their constituencies that the problems of Wall Street would soon enough be felt on Main Street(s), especially in the tightening of local credit markets.
Here in Israel, the average citizen who does not have substantial investments in foreign markets - or even in the Tel Aviv Stock Exchange - has also been until now at least one step removed from the financial crisis, and thus perhaps in a comfortable position to gain a little measure of vindictive satisfaction from the comeuppance of a Lev Leviev.
If so, those feelings will come at too high a price - or make that too low a price, namely the current shares price of Africa Israel Investments, Leviev's massive holding company. Africa Israel is normally one of the prime blue-chip stocks on the Tel Aviv Stock Exchange, and its sharp drops in recent days have had a ripple effect in helping drag down the entire TASE, especially during Sunday's steep decline.
Hundreds of thousands of Israelis who have never bought or sold a share of stock in the lives are going to feel the impact of this downturn if it continues, as a result of general pension fund investments. What's more, Africa Israel's foreign-investment losses spell potential trouble for its core businesses here in Israel, especially in the development, tourism and energy sectors.
Government and business leaders have been quick over the past week to assure the public that Israel's financial system is sufficiently insulated from Wall Street's troubles to weather this storm, and that the fundamentals of our economy are strong enough to not only avoid the kind of recession many now see as inevitable in the US, but to continue its robust growth of the past few years.
Such a scenario, though, will be harder to imagine if a pillar of Israeli industry such as Africa Israel finds itself seriously crippled by its losses abroad, and forced to compensate by making cutbacks here.
So while it may be tempting to imagine that Leviev is suddenly finding his $70m. palace in London a little on the pricey side, and thinking that maybe his humbler digs back in Israel weren't all that bad, a word of caution is called for. Whether such populist sentiments are in any way justified is arguable. What is not, though, is that many people in Israel, whether they feel that way or not, are unfortunately going to be sharing Leviev's pain in the coming year - and without the cushion of finding themselves down to their last billion.