Posted on 09/07/2005 8:43:17 AM PDT by Matchett-PI
The most noticeable thing about recent government in New Orleans is: there wasn't any. Just now is it starting to come back.
Government is politics. Politics is money. Money and economics are married to each other.
George Friedman, founder of Stratfor Global Intelligence, writes last Thursday, "... geopolitics will force the city's resurrection, even if it is in the worst imaginable place." His logic is penetrating, comprehensive, and difficult to dispute. I believe his conclusion is highly valid.
Where's the money going to come from? You guessed it--Washington.
Even as commentators point to the potential for exploding inflation from runaway energy prices, the Fed will be acting now to flood massive amounts of new money into the banking system to pay for the reconstruction of New Orleans and perimeter.
First stopping place for the money will be the stock market where its the initial effects will be seen in spring or summer of next year. The market will bottom and then start a great rise to new highs. As the money moves on from there, it will begin to spill over into real capital investment and expenditure, booming the economy again by the end of 2006 perhaps in time for the midterm elections.
The Fed has done this before: mostly recently in 1998 when Russia defaulted on her bonds and Long-Term Capital Management was collapsing; then again at the end of 1999 in anticipation of Y2K, the catastrophe that didn't happen. These were both short-duration events. New Orleans will be long drawn out. The Fed will keep feeding and feeding.
I do not much believe in short-term forecasting. Yet the stock market may give up surprisingly little ground in view of the forthcoming Fed posture related to Katrina's devastation.
"Follow the money." It should begin to show up where we can see it in six months to a year in the stock market and the economy.
considering what you put out for the blowing up of New Orleans and making into a parking lot, I am sure you understand that is both impossible and unrealistic.
My guess is that it will.
As I said, there are going to be a ton of construction jobs, IT jobs, infastruction rebuilding type jobs, all of that.
people will have money to spend and they will consume...
there will be no reason for people to say they can't get a job, but you and I both know some will find a way
I made money, but left a ton on the table... Aaagh!
Now if only my dog Priceline.com would do something (it only has to trade at $350+/share for me to break even). Bottom line PCLN is a loss on a future tax return.
Before they start building, they had better see if, they can get an insurance company to insure it.
I sure wouldn't.
As long as these investors aren't doing anything illegal, they're just taking advantage of the stupidity of the government (and the voters). We'd probably be better off locking most members of government away.
These things always stimulate economic growth. (as long as the petro thing doesn't hurt to badly)
The pie will be made bigger, not just cut up differently.
The dollars spent generate other dollars creating net economic growth.
"Perpetual cycles of flooding and rebuilding in the same exact spot (with taxpayer money) is the most communist idea I've ever heard.
It's stupid, and that a few investors will profit means we need to lock those people away - not reward them with government contracts."
I agree. If your going to keep NO in the same spot, the infrastructure to keep it safe from another calamity like this won't be worth it.
I see the next great stock market boom will be in biodiesels. Watch companies like Volkswagon who are already heavily invested in this new market.
No. What happens is that the economy grows despite the tremendous blow, only slower than it would have if the disaster had not occurred. Otherwise, as another poster remarked, we could do the economy untold benefit by carpet-bombing California.
-GAG-
I hate German cars.
"we could do the economy untold benefit by carpet-bombing California."
Well some people might be in favor on a limited basis of doing this. Berkeley, San Francisco, Santa Cruz...
Not always. Most of this money comes from very conservatively invested funds in insurance companies. These newly invested funds generally generate much higher growth tahn the old capital was providing. So the pie may get larger (but with New Orleans corruption, this may not be the case).
"I hate German cars."
I drive American but have to respect a good investment when I see one. The VW company has a nice, healthy track record for 40+ years.
I work at a home improvement center in Kentucky and on Monday mornings we print out our weekly price change sheets. Normally there are about one hundred items in the entire store. This week there were more than one hundred pages!!!
The same thing happened last year after Florida's Month of Agony and the prices stayed pretty high for six or seven months. I hate to see what happens this time around.
I would completely and totally believe it.
Those things are in need and my guess is that their supply isn't quite what they need it to be so they will be more scarce.
Things are going to outright suck in the near term, but long term there are quite a few opportunities that will come up that AREN'T Government funded.
At the suggestion of writer Michelle Malkin last Friday, I have cobbled together a blogsite called Texas Clearinghouse for Katrina Aid to serve as a clearinghouse for refugee efforts in Texas.
Texas is getting more refugees than any other state -- that's fine, we'll take them all -- but we need help providing them with food, clothing, and shelter.
If you are a refugee, you can information that will help you find relief. If you want to donate or volunteer, you can find someone who needs you.
Right now the site mostly covers Houston, San Antonio, and Dallas but I will add various churches, schools, and other charities in Lubbock and Austin tonight. My wife was down at Reunion Arena in Dallas yesterday handing out care packages and spiritually ministering to the refugees as a representative of her employer. She says that the situation is tragic and that there's a lot of work to be done. There are so many children who don't know where their parents are or even if their parents are still alive.
There are a lot of churches and other organizations in Texas that need help in dealing with the problem and I would appreciate it if you would get the word out.
Many thanks,
Michael McCullough
Stingray blogsite
My apologies, I should have noted I was attempting to agree with you.
Cool.
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