Financial Interruption

While I search for the corkscrew that will allow me to continue the next chapter of Sydney and Omar’s BDS Journey, this story from Bloomberg came across the Divest This console which should be of interest to those who are still curious about the bizarre Harvard BDS hoax that briefly flashed up at the end of the summer.

As an astute Divest This commenter pointed out last May, Israel’s move from being considered a developing to a developed country in the eyes of institutional investors has short-term and long-term consequences. For those clued into finance-speak, the Bloomberg story points out intriguing things that can happen when a country moves from being a relatively big fish in the developing economy pond, to a smaller one in the world of developed nations.

These consequences can include automated sell-offs of Israeli equities by funds chartered to only hold stocks in companies from developing economies, coupled with timing issues regarding how quickly developed-market funds start buying into the newly declared developed Israeli economy.

Over time, economic fundamentals take precedence over shorter-term buy-sell decisions. This means that Israel’s long-term prospects as a country that weathered the recent financial meltdown and is currently diversified into growing industries like energy and biotech will have more lasting positive impact than near-term buy-sell decisions based on Israel’s classification as a developing vs. developed economy.

Most relevant to readers of this site, all of these micro and macro economic matters have Avagadro’s Number more impact on investment and divestment decisions vis-à-vis Israel than does the antics of the so-called BDS “movement.” Which is why they have tried so hard to portray predictable financial decisions that have nothing to do with politics as “victories” for the divestment portion of their program. I would have thought that having gotten caught committing fraud so many times in 2009 they would have avoided such tactics this year, but the Harvard story clearly shows that this is not so.

Given the volatility of Israeli equities in the face of the recent reclassification of the Israeli economy, there is all the more reason to demand that BDSers declaring that so-and-so has done their bidding and divested to stop bothering us until they can make that claim at a joint press conference standing next to the fund managers or college presidents who are allegedly doing the divestment. After nearly two years of hoaxes, it’s the least we can demand from a BDS crew that continues to think everyone (other than themselves, of course) are a bunch of idiots.

Harvard BDS Hoax Update

Well great, big, fat surprise: the latest divestment “victory” celebrated across the BDS ether, the Great Harvard Divestment “triumph,” turns out to be yet another hoax (the biggest one so far this year).

I was beginning to think that the divestnistas had put hoaxes behind them after spending so much time last year shredding their credibility with embarrassing frauds regarding Hampshire, TIAA-CREF and Blackrock. But given the nature of the Harvard story, I’m beginning to think that someone in the BDS world knows enough about business and finance to anticipate purely economic decisions (the turnover of assets in the Hampshire portfolio, the abandoning of collapsing Israel-Africa real-estate stock by institutional investors, the transfer of Israeli stocks out of an emerging market fund once Israel is no longer classified an emerging market) so that they can pounce and claim that these ordinary business transactions actually represent political divestment from the Jewish state.

The Harvard story reveals three things about the current state of the Boycott, Divestment and Sanctions “movement”:

1. The sheer transparency of this year’s fraud (whereby a third-party moving Israeli assets out of an emerging market fund somehow translates to a Harvard-related political divestment decision) means the BDS crew must be absolutely convinced that everyone else is an absolute idiot. After all, Harvard doesn’t maintain its own emerging market fund. It invests in someone else’s. Yet the divestment crew seems to think that if they put the words “Harvard,” “Israel” and “divestment” into the same press release, they will find some media outlet (and some percentage of the public) ready to believe that this represents their first success at academic divestment.

2. For years, BDSers have been telling anyone that would listen that their divestment and boycott activities were targeted specifically at companies “benefiting from the occupation” (whatever that means). But once they got a list of Israeli companies “sold” by the emerging marketing fund owned by Harvard, it took them no time to invent rationales why Israeli companies never targeted for BDS treatment (or mentioned) before suddenly became part of Israel’s “machinery of repression.” Consider that the next time someone tells you BDS is highly limited, focused and thought through.

3. The most ironic part of this whole story is that the very event upon which the boycotters are hanging their latest “victory” (the removal of Israeli companies from an emerging market listing) is a demonstration of the phenomenal success of the Israeli economy (also testified by Israel’s recent joining of the OECD), a success which unfurled during the very decade that BDS has been tirelessly working to undermine Israeli’s economy.

As a final point, a big shoutout to everyone involved with exposing this latest divestment hoax in record time. Remember last year when the Hampshire story was allowed to linger for weeks? No longer.

I may have spotty Internet for the next couple of days, so anyone with new information is free to post it in the comments section. Or better yet, communicated it far and wide across the ether so that the next time BDS comes knocking at someone’s door bragging about its latest success, people will understand what nonsense they are truly peddling.