The tragically horrific events of early October in Israel are unparalleled in the 21st century for the global Jewish community. Not since the Holocaust have so many Jews been targeted and killed simply for being who they were.
The tragedy was not limited to Israelis. A minor fraction of the deceased were US citizens. As of October 13th, the death toll of US citizens stands at 27, with 17 still missing. Arutz Sheva reports that this ranks as the fourth deadliest assault on US civilians by foreign entities in history, following 9/11, the 1992 bombing of Pan Am Flight 103, and the 2016 ISIS attack on an LGBTQ nightclub in Orlando.
Surplus Record resolutely condemns the appalling violence and terrorism inflicted upon Israel by Hamas and its allies, including Iran. Our hearts go out to the grandparents, parents, teenagers, children, and infants violated, killed, and desecrated by Hamas, the entire Israeli nation, and all victims. May their memories be for a blessing.
The response from US corporations has been overwhelmingly in support of Israel and the victims. According to CNN, “The Business Roundtable, a trade group representing leading US CEOs, said Monday in a statement: ‘we join the US government and global community in condemning the horrific attacks on Israel and stand in solidarity with the Israeli people. The US Chamber of Commerce said in a statement it “strongly condemns the heinous” attacks.
Tech giants like Microsoft and Google, led by Satya Nadella and Sundar Pichai respectively, have denounced the attacks and expressed their solidarity with Israel. Oracle has generously committed $1 million to Magen David Adom (The Israeli Red Cross), and private equity firm Insight Partners has made a similar pledge, along with numerous other companies. This sentiment is echoed by a majority of Congress members and President Joe Biden who have also voiced their unconditional support for Israel in this time of tragedy.
From an economic standpoint, Barron’s observed after the attack on Israel, global financial markets remained largely unaffected. This suggests that investors are primarily concentrating on growth and inflation projections, which seem stable for now. However, the overarching concern for many businesses is the potential ripple effect of escalating tensions in the Middle East, and possibly involving major players like Russia and China/Taiwan, on an already shaky global economy. US inflation rates remain elevated, registering 3.7% in September, consistent with the previous month. Additionally, consumer prices in September exceeded economists’ predictions.
The jobs market also remains weak. Moreover, in an unprecedented trend, the US has consistently revised its job numbers downwards post the initial monthly releases throughout 2023. This indicates a more concerning employment scenario than what the government portrays during its monthly announcements, suggesting it is putting off bad news as long as it can. In addition, with a decline in US GDP for Q3 forecast for Q2 2023 (2.7% vs. 2.5% in Q2), an unemployment rate likely to breach 5%, global trade realizing increased disruptions and a 15% increase in shipping costs this year, the current situation is concerning even outside of the tragic events.
The volatility in Israel and the Middle East also, undeniably poses a threat to oil prices, which in turn could exacerbate inflation. CNN highlighted that in the week succeeding the violence outbreak, oil prices were set to surpass $90 a barrel, a threshold last crossed in early September, at that time primarily due to production reductions by Saudi Arabia and Russia. A few weeks prior, the business community was optimistic about potential interest rate cuts to stimulate business investments and lending. However, given the recent upheavals, a more plausible scenario seems to be consistent or increasing rates given inflationary pressures even amidst a stagnant (or possibly declining) economy, which will further burden consumers and impede manufacturing growth.