Barron’s ran with last Thursday’s Katrina Lowers Year End Expectations in the online edition (That makes two Barrons pieces in one week). They renamed it (of course) Katrina Impact is Worse than Many Think.
FORGET MOST OF WHAT YOU are reading about the post-Katrina recovery. This is an unprecedented U.S. disaster that will have repercussions around the global economy, but most especially domestically.
A major American city has been all but wiped off the map, taking the country’s largest port with it. To put this into context, the costs for rebuilding New Orleans after Katrina will exceed those of rebuilding Chicago after the great fire, San Francisco after the 1906 earthquake, and New York and D.C. after September 11th — combined. And that’s after adjusting for inflation.
Despite what some of the more bullish pundits have been saying, the stimulus of rebuilding New Orleans will not outweigh the overall loss to the economy. If it did, we would level a different city each year and rebuild it from the ground up, shiny and new. But it doesn’t, and so we don’t.
I received some interesting email following this, directing me to other articles. See for example this:
Hurricane Katrina impacts semiconductor wafer supply or this Katrina effect could cost IC market billions as examples.
Katrina Impact is Worse than Many Think
Barron’s MARKET WATCH TODAY
FRIDAY, SEPTEMBER 9, 2005 2:35 p.m.