Wednesday October 7, 2015
Israel Hayom
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Hezi Sternlicht

Why did Fischer bolt?

No matter which way you turn it, Bank of Israel Governor Stanley Fischer's dramatic departure from his role, a full 22 months before his official term ends, is not good news. It is a blow to the Israeli economy, which is already in a fragile state right now. The massive hole in the state budget is steadily growing, and a new government has not yet even been established, so this announcement is a very negative surprise.

It doesn't matter at this point who will be chosen to replace him: Fischer was an economic Gulliver in Lilliput. It will be very difficult to appoint another person of such high quality, and this will pose a problem for policymakers. Where is there another world-renowned economist who speaks Hebrew and is ready to move to Israel? There are no clones for Fischer.

Not every move Fischer made was perfect and some deserve criticism. Fischer, for instance, lowered the interest rate on the shekel after the outbreak of the global financial crisis, in 2009, thus setting the wave of increasing housing prices in motion.

In addition, not enough competition has been introduced into the banking industry during Fischer's reign. But he supported the banks' cartel to maintain stability, based on his sincere concern that Israel not pass through the nightmare scenario of a financial institution collapsing. But even given the negative influence on housing prices or the closely guarded banks, it is clear that Fischer's appointment was an extraordinary event.

His departure has set off a wave of speculations, including allegations that he is "running away" just before the economy faces its hardest tests.

The names that have come up for possible replacements are worthy, but it will be very difficult to find someone to fill his impressive shoes. As the expression goes: The cemeteries are full with people who thought they were irreplaceable, but some people in fact are irreplaceable.

Also not clear is the timing of Fischer's announcement. He could have waited for another few months at least until a government was formed and all of the government roles were filled. What was so pressing for the governor? This is a question to which we fully deserve a transparent answer.

If we put aside the shock of the message and the wave of speculations, and look back for a moment to summarize Fischer's time in office, we need to thank him for eight years of great success that were not easy. Anyone who manages to get along in the Israeli system should be rewarded for courage and perseverance. Fischer stood up to this difficult test and passed with flying colors.

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