Feeling the pinch

Over the past year the phrase "global crisis" has been used about world-shattering events, and not one's everyday life. But for Ohad Houri, a 31-year-old social worker from Tel Aviv, this crisis is tangible. Last November, when it came time to redeem long-held savings, he discovered that 20 percent of the sum - tens of thousands of shekels - had gone down the drain.

"Had I taken out the money a month earlier, I would have saved myself NIS 30,000," he says. "Nobody knew it was about to happen, and perhaps I also woke up too late. That was money earmarked for buying an apartment. Now I have to raise it again, and meanwhile apartment prices have gone up. Apparently there's no connection between real estate and the crisis. They're living there in a euphoria of their own."

Houri works with an elderly population, who are feeling it even worse. "In the past year their government allowances have been cut. They describe difficulties in buying food and medicine, and they have also lost care-giver hours. This is a weak population, which doesn't make a lot of noise about these things," he says.

We met Houri in the Levinsky market in South Tel Aviv, less bustling and quieter than larger markets. Early on a September afternoon its visitors are enjoying somewhat more tolerable weather than the humid heat of August and can smell spices and check for discounts in the delicatessen and what's new in the sushi store. It feels somewhat lower gear.

Omer Weiss, 36, is checking the window of the cheese store. Weiss, a software engineer, has been working as a security guard at the daily Yedioth Aharonoth. Like other guards there, his hours were cut with the economic crisis. "They didn't have a discussion or anything with us. It was clear they were cutting back, because they cut the salaries of all the paper's employees."

Weiss says he eats out less and tries to keep track of his savings. He discovered the Makefet Hahadasha provident fund, in which his money is invested, is exposed to the debts of Lev Leviev, the controlling shareholder of Africa Israel, who declared he would be unable to return the company's huge debts.

Weiss has decided not to move to another fund. "Before the crisis I was naive," he says. "I didn't think they invest in the hottest things that could burn up, that there would be such crashes. In the final analysis, we're all human beings, even the most senior managers, and apparently they made a lot of mistakes. People talk about banks and governments, but behind everything that has happened in the past year there is someone who made a decision."

Oded Cohen, 33, owner of Hamesik Shel Oded, which specializes in producing and marketing olive oil, has been feeling the crisis for months. He opened the new business instead of sticking with the family business of selling dried fruits, nuts and seeds and spices, like the adjacent stores. Cohen no longer keeps track of his savings; he was forced to crack them to infuse oxygen into the business.

Since the crisis began, customers are buying less olive oil. "People who used to buying a 4.5 liter container every three months have begun to buy a 1-liter container once a month," Cohen says. And the institutional sector has been worse. Gourmet restaurants in Tel Aviv serve the same dishes, but with less olive oil. "Restaurants that used to order 80 liters of oil a month have dropped to 20. In certain dishes they have replaced the olive oil with canola oil. For a customer whose palate is not sensitive, it's difficult to feel the difference, except when it comes to salad."

Iris and Orna (not their real names), aged 45 and 50 respectively, who just left the spice store across the road, came for a day of fun in Tel Aviv from the upscale bedroom community of Reut near Modi'in. They come to Levinsky mainly for the atmosphere.

"We come from a solid socioeconomic background, but this crisis has us shopping at Rami Levy [a discount supermarket]," says Orna. "Suddenly I understood the differences in price are significant. During the past year I managed to cut expenses on supermarket shopping by a third," she says. Iris adds: "You feel the crisis atmosphere in other places, too, for example at the malls. But prices - not necessarily food - are declining. So those who have money can benefit."

At the height of the crisis, Iris says, she worriedly kept track of her pension fund savings, but she and her husband decided not to take out the money. Now she is optimistic. "The government is behaving correctly in the crisis, all in all. With a lot of luck and proper work by the Americans, I believe the markets will recover. I only hope the story of Leviev doesn't signal the beginning of the next crash."

Lev Leviev's downfall also preoccupys passersby in the Azrieli Mall. On the last day of summer vacation, the mall is far from crowded. Salespeople and marketing reps are much in evidence, trying to entice shoppers with discounts. Zion Cohen, 25, in fashionable black, was sent by the Promo-Abudi advertising agency to market the discount card of the Azrieli Malls group. Cohen, from Moshav Telamim near Sderot, came to the big city three weeks ago. Because of the real estate squeeze, he's living for now in his older brother's Ramat Gan apartment.

"After the army I worked in a metal workshop on the moshav, like a Thai worker. At a certain point I decided I was sick of it and moved to the city," he says. He has also worked promoting parties in Eilat and understands that sometimes even the most charming salesperson won't help.

"Yesterday a couple here told me they were bankrupt, and had no use for a credit card," says Cohen. "I tried to tell them it's not so terrible, that's life - today there's no money, tomorrow there is. That's how I feel about the crisis, too. Ultimately, the wheel always turns."

Emanuel Damari, 52, a manager in the shipping industry, is married and a father of four. It's not easy to walk around the mall when each child is pulling in a different direction. Damari says the whole family has felt the crisis. "We're making do with less, tightening our belts. There's no choice. This year we didn't go abroad in the summer. Summer vacation with the kids was also different. We tried to go out less for entertainment that costs money. Instead of going to the movies, we went to the beach more often."

The shipping industry is in acute crisis, which is felt by Zim, which is controlled by the Ofer brothers and is dealing with oppressive debts. Damari knows the mood from close up. "There's a slight increase in imports, but in exports - not yet. I keep up with the newspaper financial sections, but it's hard for me to know what will happen." He says you simply have to wait patiently and see how things will go.

Maxim Feldman, 27, who just finished a degree in computers, wants things to move in a positive direction as soon as possible. As a student he worked for a high-tech firm and is still there but not as a regular worker. His friends are finding it difficult even to get a job like his. "The government is trying to convey the message the crisis in Israel is minimal, and this is also voiced a great deal in the press," he says. "But from what I and my friends are experiencing, the crisis is alive and kicking here, too."

We meet Asi (not his real name), 28, a technology officer in Unit 8200, outside an electrical appliance store. He and his partner want to buy a DTT device for TV reception without cable or satellite, another way to save money. The crisis has directly affected his career. A year ago he deliberated whether to stay in the army or go for high-tech and stayed in uniform. He's happy with the decision, especially as he almost signed a contract with Negevtech, which ran into problems. His friends who left the army have not become established in civilian life, to put it mildly.

"The friends I talk to are really disappointed," he says. "Their [work] conditions worsened, and they were forced to take vacation. Other friends, who began a startup, ran out of money - it's not a time to raise money for investments. Luckily, I stayed in the army. My education savings suffered a little, but that's really small change," he says.

If people in their late twenties are concerned about jobs, those decades ahead worry about savings. Yaakov Heller, 70, from Haifa, who is making his way to the train station, says, "I lost a lot of money when the provident funds crashed. I decided not to withdraw money at the height of the hysteria, and in recent months things have recovered. I told people who asked me 'don't withdraw,' because the smart people withdraw money and leave the fools to get rich. I'm not a great financial expert, but I just thought it was right not to panic."

Despite the recovery, Heller remains pessimistic. "The situation in Africa Israel is the first sign of what is liable to happen next. Today it's Leviev, tomorrow it's liable to be someone else. The crisis has shown unexpected things happen. Even now it's impossible to know how the crisis in the United States will develop," he says.

A retiree from the Hebrew University in Jerusalem, Aryeh (not his real name), says: "For me, the story of Leviev is connected to the fall of Lehman Brothers, to the atmosphere of mistrust in the world economic system, the sense everything's collapsed and there's nobody to rely on. It's hard to preserve the value of money. Today, I was in the bank, I spoke with one of the bank officers and I felt he himself didn't quite know what to tell us. 'Who knows,' he said to us, 'they used to say invest in a certain company, and you knew it was safe and sound. Now they say that only government bonds are a safe investment.'"

Aryeh, on the advice of friends, transfered his pension savings to a more solid track. Meanwhile some returned to the riskier option, but Aryeh prefers to stay with the safe one. He feels a lack of confidence, and that the government is not exactly helping him to get rid of this feeling.

"It's hard for me to say how the government handled the crisis," he says. "[Bank of Israel Governor] Stanley Fisher is playing with dollars, but the new government wasted a lot of money on superfluous jobs. In such a time of crisis, it's also not exactly comforting to hear on the news about all the corruption. [Former finance minister] Avraham Hirchson and [former Shas MK] Shlomo Benizri are in prison, and a harsh indictment has been served against [former prime minister] Ehud Olmert. Although these affairs took place before the crisis, these things have a cumulative effect and create an uncomfortable feeling."