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Jerusalem- Israeli Firm Says Costs Too High On Iran Strike

Published on: November 10, 2011 09:03 AM
By: Reuters
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 A file picture dated 21 August 2010 shows a general view of the Iranian nuclear power plant in Bushehr, southern Iran. EPA/ABEDIN TAHERKENAREH A file picture dated 21 August 2010 shows a general view of the Iranian nuclear power plant in Bushehr, southern Iran. EPA/ABEDIN TAHERKENAREH

Jerusalem - A leading Israeli investment firm said on Thursday any military strike on Iranian nuclear facilities would exact an economic price too high for the world to accept, and as a result, it would likely acquiesce to a nuclear Iran.

A sharp rise in the price of oil, the costs of war and the damage to global trade would be too great and deter world powers from taking any serious action, said Amir Kahanovich, chief economist at Clal Finance, one of Israel’s largest brokerage houses.

The assessment differed sharply from Israel’s official position that Tehran’s nuclear aspirations are unacceptable and that all options are on the table in preventing a nuclear-armed Iran, which it views as a threat to its existence.

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In a report “The Iranian Issue through Economic Eyes,” Kahanovich laid out courses of action—ranging from additional “light sanctions” to military strikes—and told investors the world would likely balk at taking the steps needed to stop Iran from developing nuclear weapons.

Even for Israel the economic cost of a military confrontation that could include retaliatory missile attacks by Tehran and proxies in Gaza and Lebanon would be too high, Kahanovich wrote.

“Unfortunately, it appears that a nuclear Iran is the most reasonable scenario,” he added.

Israel on Wednesday called on the world to stop Iran from developing nuclear weapons, after the U.N. nuclear watchdog said Tehran appeared to have worked on designing an atomic bomb and may still be conducting secret research.

Speculation about an attack on Iran was fueled last week when Israel, widely assumed to have the Middle East’s only nuclear arsenal, test-launched a long-range missile and by comments by Prime Minister Benjamin Netanyahu that Tehran’s nuclear program posed a “direct and heavy” threat.

Iran, which denies it wants nuclear weapons, said the International Atomic Energy Agency’s (IAEA) findings were “unbalanced” and “politically motivated” and vowed to push ahead with its atomic program.

Kahanovich said even a threat of attack on Iran could take an economic toll by raising risk premiums in Israel.

If Iran were backed into a corner it could take action, such as blocking the Strait of Hormuz, causing the price of oil to jump above $250 a barrel, the report said.

And the burden of funding a military confrontation would be too great with so many countries already hurting in the world economic crisis, it added.

Asked about the likelihood of global consensus for tougher sanctions against Iran, Ephraim Kam, a researcher at Israel’s Institute for National Security Studies, said China and Russia, which wield veto power in the U.N. Security Council, would not support such steps and risk economic fallout.

“The most we may see is another round of light sanctions,” he said.


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Washington - With eight weeks left before Republicans start voting for a presidential nominee, things could hardly be going better for Mitt Romney. The former... Tehran, Iran - Iran's supreme leader on Thursday warned Israel and the United States that Tehran's response will be tough should its archenemies choose a military strike...

 

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Read Comments (5)  —  Post Yours »

1

 Nov 10, 2011 at 09:19 AM realistic Says:

And what about the cost of lives?
I've said from day one that talking about attacking Iran is irational and won't happen.
Israel has no choice but to tune down, stop the ratoric and hope that Iran will do the same.

2

 Nov 10, 2011 at 09:20 AM HeshyEmes Says:

Anyone know the point of having nuclear weapons & not using them? Israel should give Iran a deadline to "stand down" and give up their nuclear program. If they refuse, which they will, Israel should take out Tehran with a nuclear strike, and onto he against other cities until Iran gives up. The world would be mortified, but life would go on & Israel wouldn't suffer any casualties. Anyone agree?

3

 Nov 10, 2011 at 09:25 AM PowerUp Says:

Stupid company for doing what they are doing, not everything is money, and if iran should hear those words it basicly gives them a free pass to do what they want.

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 Nov 10, 2011 at 09:47 AM Anonymous Says:

Reply to #1  
realistic Says:

And what about the cost of lives?
I've said from day one that talking about attacking Iran is irational and won't happen.
Israel has no choice but to tune down, stop the ratoric and hope that Iran will do the same.

Realistic? Not a bit. "Hope that Iran will do the same." Never in a million years would these animals consider it. They are barbaric enough to keep up the rhetoric, and even to act on it (probably via their proxies). This Iranian regime is majorly evil, and all the sweet talk, gestures, even sanctions have zero effect. Can anyone share a single effect of any of the sanctions of the past many years? I have yet to hear of anything.

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 Nov 10, 2011 at 11:33 AM Phineas Says:

Reply to #2  
HeshyEmes Says:

Anyone know the point of having nuclear weapons & not using them? Israel should give Iran a deadline to "stand down" and give up their nuclear program. If they refuse, which they will, Israel should take out Tehran with a nuclear strike, and onto he against other cities until Iran gives up. The world would be mortified, but life would go on & Israel wouldn't suffer any casualties. Anyone agree?

Yes, I disagree. I don't think life would just go on. I think a nuclear attack would temporarily unite Sunni and Shiite nations against the West and possibly ignite a world war b/c Europe and the U.S. would have to intervene. Moreover, it would green light Pakistan and North Korea to try to transfer nuclear technology to any country willing to purchase it because the taboo of nuclear conflict would be gone and the Muslim nations will clamor for weapons. In addition, Wester and Jewish institutions all over the world would become targets for reprisals (like in Argentina). This is a complicated 3D chess game with multiple side so put away your checkers.

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