The Official Katrina Aftermath Thread

[Sound_n_Fury]

Are you sure you want to stick with this assesment? [/i]?

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Yep, for now. It'll be the biggest natural disaster in U.S. history, undoubtedly. But will it cause a recession that touches all parts of the country? Not very likely.

 

The following is a pretty good anlysis, IMO, of the macroeconomic impact of Katrina (which is the point I was making-- not the personal tragedy of those in the storm's path, which is indeed heartbreaking):

 

Katrina was undoubtedly devastating, yet it is important to place the potential impact on economic output within the macroeconomy in greater context. As prior analysis on these pages have showed, the area impacted by the hurricane amounts to only 1.1% of total nominal output. Even if the entire regional economy impacted by the storm shuts down for days, or even weeks, the direct effect on U.S. GDP would likely be quite small. As an example, shaving 1.1% from second quarter nominal GDP would push the year-over-year growth rate down by a little less than one-tenth of one percentage point.

 

However, Katrina's wrath was not just limited to Mississippi and Louisiana. The region is a sizable hub in the nationwide oil infrastructure. Disruptions in the flow of crude from offshore platforms, refinery outages and the resulting supply fears have pushed the Bush administration to open the strategic petroleum reserve and have caused the price of gasoline to surge over the past two days. With the timetable for any return to normalcy uncertain, energy prices could remain elevated for some time. In turn, consumer resiliency in the face of pressures at the pump will certainly be tested in the final month of the third quarter.

 

It is through this conduit that we anticipate Katrina will impact growth in the second half of this year. We are still in the process of incorporating the aftermath of the hurricane into our U.S. forecast. Even with a slowdown in growth, it is likely that the economy will continue to expand at an above potential pace in the third and fourth quarters. Indeed, momentum going into the second half of the year was very strong. Demand for housing remains sturdy, inventories in the factory sector are lean and thus support a reacceleration in production, and fundamentals are in place for continued healthy business investment. Further, low interest rates (the 10-year note is flirting with the 4% threshold once again) will give the economy a boost, much as it did earlier this year.

 

Given these supports, the framework is in place for above potential growth not only for the remainder of this year, but well into 2006. At this point, the only Fed official to comment publicly on the hurricane holds a similar view to our own. Despite the events over the past few days, Philadelphia Fed President Santomero expects the economy to grow at an above potential rate in 2005—an outcome which would suggest growth of roughly 3.5% to 4% during the the second half of the year. While risks to the economy are undeniable, Santomero believes that the expansion is sturdy enough to weather recent events without a sizable deceleration of growth.

[SACTOBILLSFAN]

Well I live in Texas. I now will not have to make the 8 hour trip to Nawlins as the Bills and Saints will probably play at the Alamo Dome. So there goes revenue from LA and into TX. Also, the refugees from the Superdome are being bussed to Texas to the AstroDome where their children will be attending our schools (which is a good thing) Students at many colleges in AL, LA, and GA are being allowed to attend classes at schools in places such as Tennessee. Lets not even beat the dead horse of gas prices going out of control around the entire COUNTRY. But I sure am glad this tragedy only affected Louisiana, Mississippi and Alabama.

[CoachChuckDickerson]

Man, I feel bad for those folks but I think we're getting carried away with this story.  Louisiana and Mississippi account for 2% of U.S. output...it's not like this is a "tune out the lights" national crisis, or even remotely on the scale of 9/11.

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The largest natural disaster is the history of our country. Gas prices that could hit $4 a gallon and we should just stick our heads in the sand and keep living our lives. Nice.

[ExiledInIllinois]

At work we are the point for 411 information and the Army in this area. So far tonight I have already taken two calls from people suggesting how the levees can be filled.

 

So far I got:

 

1. sunken barge with concrete.

2. containers dropped by helicopters.

 

My reply:

 

Thank you I will pass that on.

 

[Sound_n_Fury]

The largest natural disaster is the history of our country. Gas prices that could hit $4 a gallon and we should just stick our heads in the sand and keep living our lives. Nice.

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Who said anything about sticking anyone's head in the sand?

 

The point I keep trying to make (unsuccesfully, I guess) is that in a muliti-trillion dollar economy like the U.S., as bad as things seem right now, the OVERALL impact is still relatively small. The economy can absorb this if we don't get some kind of collective panic attack due to CNN/Fox overload.

 

The issue appears to be too polarizing/emotional right now (understandable). But the impact/implications will become clearer in the next few days.

[Reuben Gant]

Who said anything about sticking anyone's head in the sand?

 

The point I keep trying to make (unsuccesfully, I guess) is that in a muliti-trillion dollar economy like the U.S., as bad as things seem right now, the OVERALL impact is still relatively small.  The economy can absorb this if we don't get some kind of collective panic attack due to CNN/Fox overload.

 

The issue appears to be too polarizing/emotional right now (understandable).  But the impact/implications will become clearer in the next few days.

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I guess I see what your trying to say: the economic trauma won't reach the scale of 9-11. That remains to be seen, but, I think in terms of a national story, the scale of this has already caused an economic dislocation for 500,000 to 1,000,000 people that are refugees. That may not change macroeconomic fundamentals, but that aint chump change either. What other event has made upward of 1M people homeless and possibly unemployed overnight?

 

You might be right, the rest of us emotionally raw and unempathetic to a macro economic\historical assessment right about now. (you could at least concede national in scale and I'll go away )

[gantrules]

"the economy can absorb this" I'm sure that is what's joe average is concerned about right now who lives in his mid level house (destroyed) with his mid level car (destroyed) with his mid level job (building destroyed) unknowning of where his next paycheck will be coming from (welfare maybe?) and how he's going to pay the bills (pimp out the children?) and where he's going to take his children for school (are the school as good in whereever I am as they were at home) and how long will my aunt, sister, mother, grandma, friends neighbors sister in law let me live here?

 

This in my mind may not have the same economic impact as 911 but on "families" the impact of this is much larger. 1 million people have been directly effected by this. No mention of the families that are assisting with housing, food, shelter, clothing, transportation.

[Sound_n_Fury]

You might be right, the rest of us emotionally raw and unempathetic to a macro economic\historical assessment right about now. (you could at least concede national in scale and I'll go away  )

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Certainly, I agree the human toll is a major story since this country hasn't had an experience like this before. I just wish there were more "light than heat" in most of the stories I'm reading on the net, seeing on TV, etc. That's probably naive on my part, however.

[Tux of Borg]

3 taxable states are now disaster areas and you don't think that will have an effect on our economy? What about the skyrocketing price of oil in regards to goods and services? Companies aren't going to suck up the added costs to ship something. That will get passed down to the consumer.

[ExiledInIllinois]

Who said anything about sticking anyone's head in the sand?

 

The point I keep trying to make (unsuccesfully, I guess) is that in a muliti-trillion dollar economy like the U.S., as bad as things seem right now, the OVERALL impact is still relatively small.  The economy can absorb this if we don't get some kind of collective panic attack due to CNN/Fox overload.

 

The issue appears to be too polarizing/emotional right now (understandable).  But the impact/implications will become clearer in the next few days.

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My wife is a librarian and she is hysterical about the state of the libraries in NO. NO houses whole collections of original children's works... Ezra Jack Keats is one author. William Faulkner's home.

 

Culturally, things are gonna be hurt.

 

[gantrules]

3 taxable states are now disaster areas and you don't think that will have an effect on our economy?  What about the skyrocketing price of oil in regards to goods and services?  Companies aren't going to suck up the added costs to ship something.  That will get passed down to the consumer.

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I heard the casinos that were destroyed on the Mississippi coast were pumping inward of 500K per DAY to the state government.

 

Now, all destroyed.

[Ralonzo]

When the levee breaks, mama, you got to move.

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New Orleans is sinkin' man, and I don't wanna swim.

[Just Jack]

At work we are the point for 411 information and the Army in this area.  So far tonight I have already taken two calls from people suggesting how the levees can be filled.

 

So far I got:

 

1. sunken barge with concrete.

2. containers dropped by helicopters.

 

My reply:

 

Thank you I will pass that on.

 

 

425098[/snapback]

I read in the newspaper that they were going to try some of those large cargo containers filled with sand, not concrete. I also heard on one of the cable news stations (don't remember which one since I constantly change channels) that they were considering using some of the vehicles now under water.

[obie_wan]

I read in the newspaper that they were going to try some of those large cargo containers filled with sand, not concrete. I also heard on one of the cable news stations (don't remember which one since I constantly change channels) that they were considering using some of the vehicles now under water.

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they should condemn the city, tear down the levies and let nature take its course.

 

FEMA can pay for the lot and insurance can pay to build a new house, somewhere other than below sea-level.

[jester43]

5:00 Eastern time is when the president is to speak to the nation.

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that should be humorous...

 

GW (replete w/ deer-in-headlights look): "guys! dick! what do i say?! tell me what to say!"

[erynthered]

that should be humorous...

 

GW (replete w/ deer-in-headlights look): "guys!  dick!  what do i say?! tell me what to say!"

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Boy, you're right up on things. He spoke yesterday at 5PM.

[Puhonix]

they should condemn the city, tear down the levies and let nature take its course.

 

FEMA can pay for the lot and insurance can pay to build a new house, somewhere other than below sea-level.

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8 million of the Netherlands population lives in areas that are below sea level. That's not the problem nowadays. The problem is getting technology to fix the problem. Move the entire city? Are you crazy? While it makes sense on the surface, how long until you get a new metropolis functional again? And what about the cost?

[kegtapr]

8 million of the Netherlands population lives in areas that are below sea level.

And I'm sure they're worried about a hurricane coming up the English channel.

[aussiew]

And I'm sure they're worried about a hurricane coming up the English channel

 

The north Atlantic has some pretty viscious storms and the resultant surge is what prompted the building of the dykes in the first place wasn't it?

 

I was writing notes in school and missed that part of my social studies lesson

[JinVA]

And I'm sure they're worried about a hurricane coming up the English channel. 

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And everyone knows that only hurricanes cause floods.