Forgot your password?
New user?
Snafu by cops halts trial of activist arrested in Lexington
Palestine group defies a Zionist effort to shut down April conference
An Nu'uman Before
2005 SDP initiative petition
Stop the War Against Sudan
Document Actions
Israel bonds in Fidelity Mutual Funds
Israel enforces the Occupation with equipment bought from the U.S. Instead of paying for it in cash, the State of Israel issues bonds in its own name. Third party investors buy this public debt, assuming its risk and collecting interest payments until the bonds mature.
Investors find these bonds extremely attractive because the U.S. government guarantees them against default through its Agency for International Development (AID). This arrangement is unique because the U.S. guarantees the public debt of no other foreign government. Some experts believe the State of Israel is unlikely to ever redeem these bonds, so the guarantee may in effect be a gift paid for by U.S. taxpayers.
American citizens are unlikely to change this Federal policy soon. Yet there is a way individuals can withhold support. State of Israel bonds, guaranteed by the U.S. through AID, are held in the following Fidelity mutual funds (percentages in parentheses show the portion of each fund allocated to these Israeli bonds):
$202 million (4.4%) of Fidelity Government Income Fund
$78.9 million (9.3%) of Spartan Government Income Fund
$33.4 million (3.6%) of Fidelity Intermediate Government Income Fund
$7.6 million (0.33%) of Fidelity Strategic Income Fund
$2.4 million (0.03%) of Fidelity Intermediate Bond Fund
$1.8 million (0.03%) of Fidelity Investment Grade Bond Fund
$0.9 million (0.04%) of Spartan Investment Grade Bond Fund _________________
A total $327.5 million of State of Israel Bonds are held in these seven Fidelity mutual funds. This data is taken from Fidelity reports ranging from mid-2004 through January 2005, and it is available on the Fidelity Investments website.
No other mutual fund company besides Fidelity appears to include State of Israel bonds in its bond funds. American taxpayers unhappy about paying for these bonds with their taxes need not also carry them as investments in their investment portfolios. They can:
- divest from any Fidelity fund that contains State of Israel bonds and inform Fidelity of the reason for their action, or
- stay invested in one or more of these funds in order to join a shareholder resolution urging Fidelity to eliminate these bonds from its funds. The resolution would be offered for a vote at an upcoming annual shareholders meeting.
For more information or to participate in a Fidelity shareholder resolution, please contact Edward Morin at (734) 668-7523.