FinSight For Israel Vs Iran

I woke up in the morning after a sound sleep. I was reading my routine materials and came to know that the tension going on between the two giants of middle east took a form of deadly war.

Wars are never started in a day or two, it always has huge roots growing under the ground since several years. I tried surfing for the reason and got to know whole back story. I’ll narrate this story in summarized form.

Seeds of Rivalry

So, the story dated back to 1979 during Iranian Revolution. Prior to this Iran was ruled by a king (known as Shah) who has very good bonding with the west including Israel. However in 1979, people of Iran demanded for a change. They led a revolution to overthrow the king and elected for an Islamic Republic under the leadership of Ayatollah Ruhollah Khomeini.

Khomeini has a very different perspective from Shah, specifically about western countries and their allies. Under this rule Iran started not to incline toward Israel as a friend but as an opponent. The new government supported Anti-Israel movements and voiced strong for the groups that were against Israel. They started supporting to a group named Hezbollah from Lebanon, which is known for its strong resistance against Israel.

Dynamics of Rivalry

On other side, Israel considered these moves as threat to their land as, the Jews already got their motherland after so much efforts and faced a huge genocide too. Jews were over protective for their land and after witnessing Iran’s shift in the policies they became more cautious and aggressive too. Israel particularly worries about Iran’s intention to develop the nuclear weapons. They fear that such weapon could threaten their existence.

The Shadow War of Iran and Israel

Both the giants engaged in shadow war since then, both confronted each other directly but hampered the interests indirectly. They supported the opposing groups for each other and made whole middle east a chess board rivalry. But it was never expected that both will end this into a battlefield.

There is an instance from 2006, where Iran supported Hezbollah group which was fighting against Israeli forces. In Syria, Iran supported the ruling government whereas Israel was inclined toward the opposition groups and carried out airstrikes there against Iranian interest there.

Tensions Escalate

A significant incident occurred in Damascus, the capital of Syria. There the Iranian embassy was attacked leading to the death of several high rank officers of Iranian Corps. Iran suspected that Israel was behind this mishappening, though Israel neither accepted nor denied it’s involvement.

This incident made the situation more fragile. Leader Khomeini gave an official statement that they will definitely retaliate. Eventually this fight was now, not just about two countries but slowly pulling the world into it.

Financial Fluctuations

This war will definitely not benefit the Countries involved but can benefit the traders who follow sharp strategies. A huge impact can be seen on Gold and Stocks.

Gold is considered as most safe asset during the times of geopolitical conflicts. When Investors anticipate instability they often shift their resources to gold, as it is considered as safest investment on globe in comparison to stocks and other assets that might negatively react on economic sanctions and trade disputes. Thus this war will surge up the price of gold.

Stock reacts inverse to the gold, there are high chances that market can break it’s support and crash and stocks are considered as risky investment during global tension. Some specific sectors may get more hampered like travel, finance and manufacturing can be hit hard by rising oil prices. Defense stock may see an uprise due to increase in demand for military spending. Overall the indices may face high volatility.

Key Takeaways

Dear Readers,

With this case did you notice that how the tensions among two countries can complex it’s alliances, economies, history and obviously impact the present. Because in Global Politics nothing is black or white it’s always grey.

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