ISR AEL 'DIGEST Specially compiled by The Jerusalem Post — $1 EQUALS 2.862 NIS (shekels) - Close Price 8/13/93 — Israel On Par With West Israel is a good place to live, according to research published last week by Federation of Israeli Chambers of Commerce economists. The economists looked at social factors instead of the usual focus on Gross National Product, income per capita, etc. They com- pared life expectancy, fer- tility, calorie consumption per capita, child mortality rates, illiteracy rates and women's workforce partici- pation rates to those of other countries. According to these mea- sures, Israel compared favorably with most coun- tries, even with other Western nations. Life expectancy is exactly 76 years, as in the United States, compared to the average expectancy of 76.4 years an the seven indus- trialized nations. Israeli Economy Slows World Wide founders: Howard Babcock, Robert Silverstein, Andrew Jacob and Jack Wolfe. April," said Nancy Fried- man, a First Equity loan officer who holds an MBA degree. "At the time, I had been looking for work (in other professions) for sever- al months. It's nice this industry is doing so well." Still, while mortgage lenders from Standard Federal Bank in Troy to the Rock Financial Corp. in Bingham Farms have enjoyed a steady, if not explosive, flow of new busi- ness in recent years, inter- est rates won't stay low for- ever. The economy is expected to pick up during 1994 and the Federal Reserve will no doubt raise rates in an effort to limit any sizeable growth in inflation. Any uptick in rates will stifle the refinanc- ing market as savings dry up — most lenders report refinancing makes up between 30 and 50 percent of their overall business — while discouraging the new purchase market. There is the chance, though, that higher federal taxes will limit the growth of the economy and keep rates at present levels. "Every mortgage compa- ny has enjoyed tremendous growth over the last two years, but if the rates go up the refinancing market will drop off," said Jim Golden, loan officer for Shore Mortgage in Birmingham. "But there is the possibility the economy will improve without higher rates. "An increase in (federal) taxes could put a damper on the economy. Under such a scenario the Federal Reserve will keep rates low to offset tax increases. For the rest of the year rates will remain where they are now and we'll just have to wait and see what transpires next year." While a drop in rates will cut into new business, mort- gage companies say they are prepared for the shift. Like most firms facing a down- turn, area mortgage lenders will step up marketing and advertising campaigns to compensate. For instance, in what turned out to be a market- ing coup, World Wide gam- bled $10,000 in March 1991 ed into a lot of new business and spring -boarded us into what we are today. The show also brought in new clients through word-of- mouth advertising." By June of 1990, the four partners, who each worked 100-hour weeks and fol- lowed a business plan hand- written on a yellow legal pad, hired their first employee. Today World Wide has over 160 workers and recently moved into a 25,000-square-foot office in downtown Birmingham. In addition to its Birmingham headquarters, the firm has offices in Bloomfield Hills, Brighton, Farmington Hills and Troy. Future expansion includes branch sites in Grosse Pointe, Grand Rapids, St. Joseph and Indiana. Jack Wolfe, co- founder and president of World Wide, said the firm closed more than $400 million in resi- dential loans during the first half of the year. In addition to home mortgages, the firm also provides commercial lending and leasing ser- vices. In the fall, the firm will unveil a full financial planning and consulting division. A strength of the compa- ny is the close relationship it has built up with area real estate agents and bro- kers. The firm provides prospective buyers with a free financial analysis while supplying agents with four- color fliers of individual list- ings and numerous other marketing tools unique to the industry. ❑ While a drop in rates will cut into new business, mortgage companies say they are prepared for the shift. Area mortgage lenders will step up marketing and advertising campaigns to compensate. for a booth and promotional items to hand out at the spring Builders Flower and Furniture Show at Cobo Center in downtown Detroit. "After the first day of the show we came home exhausted," said Andy Jacob, a founding partner and senior vice president for World Wide. "The interest rates had just taken their first dip and people were crowding around our booth for information. "Everyone wanted to know about refinancing and the money they were going to save. The show translat- Economic activity slowed down in the second quarter of the year but is expected to take off in the third quarter, according to a Treasury report published last week. According to the report, the slowdown in the sec- and quarter was expected, although the closure of the territories put an addition- al damper on the economy. The report notes exact figures for the second quarter were delayed due to the civil servants' strike last month and are still unavailable. The closure is expected to improve employment statistics, as Israelis replace workers from the territories. It is also expected to reduce exports to the territories, due to the drop in the inhabi- tants' incomes. Exports Down, Business Chief Says Israel's exports are suffer- ing on international mar- kets, Manufacturers Association president Dan Propper said last week. Mr. Propper said exports are hindered by lower export orders, price compe- tition — which led to a fall in prices — and interna- tional trade limitations. The drop in overseas export prices reflects com- panies' difficulties and a fall in export profitability, he added. Mr. Propper based his remarks on a survey of 200 firms con- ducted by the association's economic division in July. Trade Deficit Dips 53 Percent The trade deficit dropped 53 percent to $268 million last month, as imports fell sharply due to the civil ser- vants' strike. The strike, which shut down customs stations for two weeks, cut imports 13 percent, the Central Bureau of Statistics reported. Exports totaled $1.18 billion, while imports stood at $1.45 billion. According to seasonally adjusted export figures, excluding diamonds, goods exports fell 1 percent in June and July. Industrial exports, which make up two-thirds of exports, dropped 2 percent during the same period. Investment Promo Body Needed Recommendations to cut red tape and expedite the approval of capital invest- went projects entitled to government incentives were presented last week to Industry and Trade Minister Micha Harish by a public committee he appointed. The panel, headed by Tel Aviv University eco- nomics professor Haim Ben-Shahar, recommended creating an investment promotion authority that will centralize every aspect related to establishing a government-approved enterprise. The creation of an investment promotion authority is aimed at sim- plifying the process and reducing the time it takes for the approval and estab- lishment of a government- approved enterprise, reducing the investors' level of uncertainty at the beginning of the process and improving the service provided to investors throughout the process.