The Israeli economy has contended this spring with a third national election in less than a year, a prime minister under indictment, and a global pandemic.
And yet, on May 17, the credit rating agency Standard & Poor’s issued a report stating that Israel would retain its AA-rating. The forecast for the near future even expressed confidence in the country’s continued economic stability.
To Israel Maimon, president and CEO of Israel Bonds, that is a key point in continuing his work — selling individuals and foundations on the idea that an Israel bond is a sound investment.
Working from home, Maimon and his team can’t do their usual parlor meetings, speaking arrangements, or galas. Though there was a steep learning curve, they haven’t slowed down in their mission.
“With humility, we’ve overcome this very quickly,” Maimon said.
What are the challenges to Israel Bonds that are unique to this period?
The first concern, or challenge, is the uncertainty that exists in the hearts and minds of the people, whether it’s a Jewish investor, or whether it’s an Israeli Christian supporter. How much liquidity do they need to have in their pocket? For how long are they going to invest? And with what kind of instruments? Equity? Everyone understands that equity was hit so much.
So, whether bonds are the alternative, whether to keep it in the savings account in the bank, stuff like that. This is one concern.
It’s the mood. People that are at home, many of them unemployed, they don’t know what’s going to happen to them in the coming few months. In some of the places around the states, there is still a shutdown, and people cannot see when it is going to be lifted.
These are the two main challenges that we are dealing with. I don’t need to motivate anyone to invest in Israel; I don’t need to explain the importance of investing in Israel. I don’t need to give the Zionistic speech. It’s understood. I would say even, contrary; they understand that the state of Israel needs to be secured by additional capital, because like every responsible government, we need to secure the additional capital for any eventuality. So I don’t need to give this speech.
However, we need to ease the fear, or the concern, of the individual, to explain why all is solid, why it’s still important, why it has a good yield compared to other financial instruments.
Does the way you make the case to investors, large and small, change?
The case is less about the importance of investing in Israel and more to ease the concern of investing in general. This is the way it shifted a little bit.
Of course, we have to explain and to give all the arguments and the messaging, which are also relevant to Israel. People need to know that Israel’s economy is great. It’s stable. There is not any liquidity problem.
What have been some other challenging periods for Israel Bonds? And how has thinking about them shaped the way you’ve approached your work in the last few months?
Let’s be honest: Nothing can compare to this period. Nothing. Not in the size, not in the uncertainty, and not in the scale, I would say.
When you look at previous challenges, it’s a little bit different. One challenge, for instance, is that something is happening in Israel. A crisis, or a war in Israel. Usually, it’s a positive impact on Israel Bonds, because immediately, the solidarity that the Jewish people want to show … you see an immediate jump, on how many bonds we are selling.
If it’s a crisis that is happening outside of Israel — let’s say the 2008-2009 financial crisis — of course it had an impact on the investors that live outside of Israel. And then, you can see an impact again, people are seeing individual challenges, and you see a decrease in the investment in Israel bonds.
In general, Israel bonds, through the years, the growth of the selling of Israel bonds is steady, it’s good. I cannot say we took something out of those past challenges in order to implement now.