The tweet I received on my Twitter page from Guy Rolnik, creator and founding editor of TheMarker, surprised me: “Eyal Ofer, leader of the Yisrael Yekara Lanu (‘Israel is too expensive’) social protest movement, created quite a stir at the world economic forum in Davos this morning. It is unclear whether he himself is aware of this fact. Details to follow.”
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Since I have no plans on how to bring about world peace and since I did not have $70,000 in spare cash to pay the registration fee for the billionaires’ conference in Switzerland, it was obvious that I could not be there. Then, after a few seconds, the picture came into focus: Henry was behind this.
Henry Blodget is a former Wall Street analyst. In 2002, he was sued by former New York governor and attorney general Eliot Spitzer, who at the time was feared by Wall Street bankers. This same Eliot Spitzer – who was later caught with a $6,000-a-night call girl, and was forced to resign – accused Blodget in 2002 of fraud. In the end, a deal was cut: Blodget paid a $2-million fine, returned profits totaling $2 million and left the profession of equity research analyst forever.
Blodget then went in a different direction and set up a successful website called The Business Insider. He has a popular Tweeter page (with nearly 100,000 readers); when I opened up an account with that site a year ago, I responded to his tweets once or twice, but not in any serious fashion. For example:
Blodget: “Excellent on Bitcoin by Cullen Roche … One risk is that govt might outlaw accepting it as payment.”
I answered: “@hblodget Governments and C/B have done a poor job withdrawing currency (“take away the punch bawl”) will BC creators?”
Surprisingly, he answered me and became one of my veteran Twitter readers as he warmly welcomed my joining his website:
“@Eyalo365 Eyal! Great to have you on Twitter! Yes, govt.’s have created massive opportunity here (for Bitcoin). Will be very interesting.”
At first, I could not understand what possible interest Blodget could have found in me, especially since most of my tweets were in Hebrew and he obviously could not read them. If he could have done so, he would have understood that I am still involved in organizing a protest against the high cost of living and against the present arrangement concerning the use of Israel’s natural gas resources, and that I remain uninvolved in any matters concerning Wall Street.
From time to time I would respond to him in English and, then, to my great surprise, a senior member on his editorial staff and a financial editor at The Daily Telegraph wrote me.
Blodgett: “RT @AmbroseEP: Oxygen thinning. Shiller P/E ended week 47pc over-valued. Good blow-off chart from Husmann.”
Eyal: “@hblodget @AmbroseEP For every crash: P(someone claiming to predict it) ~ 1. For every prediction of an imminent crash: P(being correct) ~ 0.”
The Telegraph international business editor, Ambrose Evans-Pritchard: “@hblodget @Eyalo365 Eyal, Husmann was not predicting imminent crash. His projection shows S&P going further. My view, all depends on Fed.”
I was amused. I began to feel like the gardener in the film “Being There” (1971). Who do they think I am, and why are they tweeting me about stock prices in the world?
I am not Eyal Ofer the billionaire
At this point, the situation became clear. In the past, I have sent emails to people whom I do not know and they have answered me in very respectful tones. After such experiences, I now begin every email to anyone whom I do not know with the words: “Hello, I am not Eyal Ofer the billionaire.”
I now understood that Blodget and the American journalists thought that there is only one Eyal Ofer in all of Israel [i.e., the son of the late tycoon Sammy Ofer] – after all, this is a small country.
I decided to give Henry some hints with the help of tweets in English that would express ideas that – let me put this delicately – could never be uttered by a billionaire. Let us see when he begins to get the picture.
Henry writes about claims regarding economic inequality: “Here’s who makes the money in this country – and who pays the taxes.”
I responded: “Note that in many countries, even the poor and middle class have high tax burden: sales tax, VAT & excise tax.”
Henry still doesn’t “get it” and points out (quite rightly) that his own taxes in the United States are very low: “Yes! They do in the US, too, though sales taxes are generally lower than VAT.”
Then the thought crossed my mind: “Maybe I should invite him to pay a visit here in Israel. Over here, all our finance ministers since [Benjamin] Netanyahu in 2002 were champions of imposing taxes on the lower classes.”
Henry would write about the stock market bubble and I would respond that in 2006, just before the American real estate bubble burst, then-Federal Reserve chairman Ben Bernanke said there was no bubble: “This was true in 2006 when BB said there is no bubble and in 2008 when he said: The Fed will not monetize the debt.”
Blodget: “Yes, Bernanke blew it on the housing bubble. But QE isn’t 'monetizing' in the sense that most people think. No?”
I answered: “If QE will be unwind – then it is NOT monetizing. How far into the future do we wait to know?"
Blodget: “We shall see, Mr. Ofer! We shall see! (Speaking of which, very much hope to see you in January!).”
I had no idea what the guy was talking about. Does he have another connection who helped him arrange a meeting with the real estate mogul in January? Only the gods of Twitter know. I started to make hints to him by responding to his tweets about real estate with suggestions to impose a tax on vacant real estate assets (similar to the suggestion I've made here), but Blodget still doesn’t get it.
Who am I talking to?
A few days ago on his way to Davos he once again mentioned that he hoped to meet me at the conference. I decided to try to give him a broader hint.
In response to his tweet about the fact that about 85 of the world’s wealthiest people own half the world’s assets, I wrote the following: “Henry, let’s play an imaginary experiment (a method that Einstein liked). Ex1: 50% of the '85' wealth is confiscated and distributed to the poor… "
Before I could continue, Henry already replied: "The economy would probably boom for a while (because the 50% would spend the money)! Well … If divided $110T among 3.5 billion people, they’d get $31k apiece (if my math is right). They’d spend that."
I compliment Blodget on his mathematical abilities (you can see he worked on Wall Street – he’s fast with numbers) and go on to "Ex2: Strong deflation reduces the '85' wealth to 50% its 'nominal worth' as well as a large part of their power and influence. In both exterminates the '85' lost 50%. But how will it influence the rest of the world when goods, homes and everything becomes cheaper."
Blodget doesn’t reply.
A few minutes later he suddenly continues: “I’m not suggesting wealth should be divided up like that. Just continuing your thought experiment …"
I bring Henry back to experiment No. 2: “What would happen if the prices of assets decline worldwide. That could benefit masses of people. Food is expensive now because the prices of merchandise are high. Real estate prices prevent people from purchasing a home. Everywhere in the world central banks are printing money in order to prevent the decline of prices.
"Your math is perfect. How about Ex#2, is this the way to get out of the great malaise? But the 2nd experiment would reduce cost (including food prices) and would improve life across the whole planet."
Blodget doesn’t reply. He has apparently realized what’s going on. He understands that the suggestion to let real prices in the world decline (and this is not only a stock price collapse that he’s talking about) is a radical, revolutionary and dangerous suggestion for the top 1 percent. It’s impossible for some international real estate mogul to suggest such a thing: to allow prices to drop (I already suggested that in Hebrew).
And then comes the next tweet from Rolnik: “Several participants in Davos will confuse Eyal Ofer the billionaire with Eyal Ofer of Yisrael Yekara Lanu. A famous American journalist made a mistake – and they followed his lead. And then the rumor spread … that Eyal Ofer’s Twitter account was hacked … But very soon someone explained the source of the mistake to the entire happy gang, and the billionaires returned to their important affairs.”