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"A couple of years ago, my accountant came to see me and said, 'You can save a quarter-billion shekels in taxes this year if you move abroad for a few years,'" one of Israel's biggest business barons, who is living in Israel, related last week. "It took me all of 40 seconds to say no. I assume that Lev Leviev's tax bills could be 10 times higher and it's a lot harder for him to say no."

Israel was shocked to the core about two weeks ago when it turned out that billionaire Lev Leviev, the richest man in Israel, had decided to move to London, where he bought a $70-million mansion - and while he was at it, a $50-million executive jet. But anybody who has been keeping track of trends among the billionaire crowd might have predicted Leviev's relocation: London has become home to many of the world's wealthiest people in recent years. The combination of particularly convenient tax laws for foreign residents and a standard of living all but unequalled around the world have made the city irresistible, rain and gray skies notwithstanding.

Many Israelis think that buying a house for $70 million is utter madness, but Leviev didn't break any records in London. Dozens of Russian, Chinese and American multibillionaires, and hundreds of multimillionaires seeking to move to the world's most global (and welcoming) city pay prices like that without blinking, and have jacked up costs in prime areas to levels that were unthinkable just five years ago.

Demand for executive jets has never been so keen, either. Manufacturers tell of two-year waiting lists. If you want your private plane here and now, it will cost you millions more, in cash, to move up to the top of the list. Is Israel doomed to lose its wealthiest to London? Apparently, yes: The public here won't stand for the kind of tax breaks that the billionaires can get elsewhere. We are too small and too competitive a country to formulate a tax policy that relates only to financial and competitive aspects of life, while ignoring the social ramifications.

Until six months ago, Nathan Hetz practically walked on water. Fifteen years ago he resigned from managing the Ackerstein construction company in favor of forming his own firm, Alony Hetz. For a whole decade, he generated phenomenal returns of 43% a year in real terms. That's the sort of result achieved by the cream of the investor crop.

That was then. Just three months ago I ran into Hetz and asked what next. "I see no chance that I'll ever be able to duplicate these returns," he said candidly. "Today if somebody were to assure me of 12%-15% real returns a year, I'd snap it up."

Hetz knows whereof he speaks. His astonishing returns were not connected only to his talents, but to the prolonged boom in the real estate and capital markets. But all good things come to an end, eventually, and in recent months investors in Alony Hetz have been dismayed to see that Hetz couldn't actually walk on water. Alony Hetz shares tumbled 40% from their peak, after stocks in several firms in which the company had invested were hit hard.

Nathan Hetz is in good company, and the only reason that he's attracting attention, unlike other Israeli real estate barons, is that he chose to make his big investments in public companies. There are dozens of real estate companies listed in Tel Aviv that invested vast amounts during the last couple of years, buying land, projects and buildings around the globe using borrowed money. Sadly, the value of these assets has been savaged in the last few months. Happily for the companies, they don't have to report this publicly because the assets are nonnegotiable.

The renowned economist John Maynard Keynes once said that the real estate market is no safer than the stock market and the only reason people think it is, is that property prices don't fluctuate by the hour like stocks do. If real estate prices were to appear in the paper next to the stock quotes, he said, at breakfast our hair would stand on end.

Many investors don't yet realize what's happened to the value of the properties that these companies soaked up. Well, a lot of Israelis are about to experience that feeling of hair standing on end.

Several of Israel's wealthiest biz whizzes (and politicians) must have smirked when TheMarker reported recently that Davida Lachman-Messer is resigning. They didn't like the deputy attorney general, a stubborn official who firmly blocked many a transaction that they wanted to conduct with government. Sometimes she was the only obstacle to various goodies from the state. They couldn't act like horse thieves with her as sheriff and didn't like it.

She had her down sides, too. She was stubborn as a mule and her interpretation of the law tended to be very broad indeed. She wanted to wield influence and didn't see herself as confined to the narrow legal aspects of her fiefdom. She was a lawyer who engaged in issues of a highly economic nature and it showed. But Lachman-Messer was one of the best civil servants Israel has ever had in this era of big money, and she stood out in contrast to the groveling before wealth and bobbing for shekels. She leaves behind her many good people, some young, talented and enlightened, some better versed in economics and law, but few with her burning zeal to do the right thing, the just thing. Israel urgently needs people with the quality of Lachman-Messer, talented people whose overriding priority isn't kowtowing before tycoons in hope of a sweetheart job when they leave the government.