Amid ongoing conflict, global economic uncertainty, and security challenges, recent statements from former U.S. President Donald Trump predicting massive gains in the U.S. stock market have reignited debate around who benefits from volatility in international markets. While Trump’s forecasts are closely watched by elite investors and have historically influenced market movements, many Israelis point out that average citizens rarely share the prosperity generated by such predictions.
In Israel, the backdrop to any discussion of prosperity is inextricably linked to national security. Since the October 7, 2023 massacre—when Hamas terrorists mounted the deadliest antisemitic attack since the Holocaust, executing, abducting, and mutilating Israeli civilians—Israel’s economy has faced mounting challenges. With the government forced to divert resources to defense, the cost of living has risen, and the economic gap between tech-driven prosperity and daily hardship in conflict-affected communities has deepened.
Trump’s Unabated Financial Optimism
When Trump recently claimed, “the country is going to go up like a rocket” and suggested it was time to buy stocks, experienced analysts and Israeli commentators noted the recurrent pattern: significant market movements frequently benefit American millionaires and institutional investors who have direct access to market-moving information. Meanwhile, for the ordinary public—whether in the U.S. or in Israel—such opportunities remain out of reach, as most households are focused on short-term economic survival amid inflation, stagnating wages, and geopolitical uncertainty.
Past precedents show that statements by high-profile figures, particularly former presidents with ongoing influence, can create short-lived surges in trading volumes or asset prices. However, underlying these market shifts are growing concerns over income inequality and the implications for national economies, especially those like Israel’s that are deeply interdependent with global financial trends and deeply affected by security threats.
Israel’s Dual Challenge: Economic Resilience in Wartime
Since the onset of the Iron Swords War—Israel’s sustained campaign to dismantle Hamas and deter Hezbollah and other Iranian-backed forces—military expenditures and emergency social spending have risen steeply. The Israeli shekel, although relatively resilient, has experienced periods of volatility. The Tel Aviv Stock Exchange rebounded after initial declines thanks to confidence in the country’s technology and defense sectors, but economic growth remains uneven.
Prime Minister Benjamin Netanyahu’s government, supported by Defense Minister Israel Katz and IDF Chief of Staff Lieutenant General Eyal Zamir, has maintained that robust economic management must accompany military strategy. Emergency aid programs, targeted tax reliefs, and increased support for export industries have been enacted, yet families living near the borders face daily hardship due to evacuations, business closures, and the constant threat of rocket attacks or terrorist infiltration.
Market Gains and Everyday Reality
The contrast between elite gains and popular hardship is not lost on Israeli society. Even as defense exports and international investments in cyber and AI surge, the benefits are often confined to select sectors. Young Israelis on reserve duty, small business owners, and new immigrants struggle with rent hikes, job instability, and price increases for basic goods. Economic data from the Bank of Israel and the Ministry of Finance underscore these trends: GDP growth is projected to slow in 2024, and wage growth lags behind both inflation and the cost of securing the nation.
Security and Prosperity: An Uneven Equation
Unlike in more stable economies, Israel’s emphasis on security is a daily economic reality. Multi-billion shekel investments in cutting-edge defense—such as the Iron Dome, David’s Sling, and other joint U.S.-Israeli initiatives—have saved lives and bolstered the economy, particularly in the defense sector. But security needs necessarily divert significant budget resources from civilian development, welfare, and infrastructure. Officials continually stress that military preparedness is not just the government’s obligation but a prerequisite for any lasting prosperity.
International Context: U.S.-Israel Interdependence
The optimism of American financial elites—shaped by figures like Trump and enabled by the global dominance of U.S. markets—anchors much of Israel’s external economic environment. Nonetheless, Israeli officials and economists urge caution, warning that speculator-driven rallies typically do not address deeper issues rooted in instability, terror, and the challenge of ongoing conflict spurred by Iran and its proxies. The Abraham Accords and tightening bilateral ties with the U.S. remain essential but cannot, on their own, shield Israeli society from regional volatility or the pain of war.
Moral and Historical Imperative
Every financial trend in Israel is overshadowed by the moral and historical stakes of survival. The atrocities committed by Hamas and other Iranian-backed terrorist groups are not only criminal acts but existential threats shaping national priorities. The government and security services are unequivocal that the fight against terror is a matter of justice, morality, and self-preservation.
For Israelis, prosperity cannot be separated from security. Economic policies—whether swayed by global optimism or the demands of war—must deliver material benefits and stability for all citizens. As headlines spark trading frenzies far from the realities of Sderot and Kiryat Shmona, Israel continues to balance the ideals of innovation and progress with the unyielding demands of resilience and vigilance.
Conclusion
Trump’s bullish projections for the U.S. market have once again drawn attention to the gap between market winners and those left behind, particularly in societies navigating not only financial but also existential threats. Israel’s experience demonstrates that markets may rise and fall on words, but true national strength depends on security, justice, and the ability to safeguard the future for all its people.
This report contains no investment advice. All information is provided for context and analysis only.
