Over the years, there have been many smaller conflicts, mostly blown over fairly quickly and barely having any effect on the economy. The next time, war with Hezbollah is going to hurt and it will cut deep.
For many years, Israel has lived in a world of its own, believing war to be something that happened everywhere but there. OK, since 2006, there have been at least four separate conflicts but, while there were casualties, there was very little in the way of material damage and no real interruption to the economy. This could be why investors are brushing off any concerns, despite being told by many experts that conflict with Hezbollah is imminent and is likely to be catastrophic. While the TA-35 large-cap index has fallen slightly on the Tel Aviv stock market, much of this is down to Teva Pharmaceuticals and not imminent war. Indeed, the shekel has risen against the dollar. Sadly, this lack of concern is based on something that no longer holds any water.