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Bank of Israel’s Fischer: No Global Recession

Calm down. A global recession is not on the horizon, says Bank of Israel Governor Stanley Fischer.
By Tzvi Ben Gedalyahu
First Publish: 9/11/2011, 11:59 AM

Stanley Fischer
Stanley Fischer
Flash 90

Calm down. A global recession is not on the horizon, says Bank of Israel Governor Stanley Fischer, who has helped guide Israel’s phenomenal economic growth and stability.

He told a monetary committee, "There is a slowdown in the global economy, but we're not seeing a global recession at this stage, and it is possible that a global recession can in the end be avoided.”

Financial markets are panicking over the possibility of a double-dip recession following the negative growth that resulted from the financial bubble that burst three years ago.

Israel is enjoying more growth than the United States and most other established markets, partly because of the constantly growing population.

In the United States, the “baby-boomers” of post-World War II are nearing the age of retirement and have no need to buy consumer products as they did while raising their children.

The American economy is growing but at a crawling rate.

Concerning Israel’s crisis with Turkey, Fischer said it is a “risk factor [only] for Israel's short-term economic development."

While the United States has suffered the embarrassment of its credit rating being downgraded, Standard & Poor has raised Israel's long-term foreign currency credit rating from A to A+.

Prime Minister Binyamin Netanyahu said Saturday night the move by Standard & Poor is “an important recognition of the responsible way in which we have been managing the economy… This is one of the most important expressions of faith in the Israeli economy that guides investors.”

He noted that unemployment rate in Israel is one of the lowest in the world. The United States is suffering from a 9.1 percent jobless rate, but the real figure is estimated to be twice as high when taking into account millions of people who simply have given up trying to find work and are therefore not included in the monthly unemployment rate figures.