WASHINGTON: Hurricane Sandy may cause as much as $20 billion in economic damage and losses as the biggest Atlantic storm made landfall, flooding homes and offices, after disrupting millions of fliers and forcing stores to close.
Insured losses may reach $5 billion to $10 billion, or about half of the total, according to estimates today by Eqecat Inc., an Oakland, California-based provider of catastrophic risk models.
Sandy, spanning 900 miles, slammed into southern New Jersey at about 8 p.m. New York time and brought a surge in Manhattan exceeding 13 feet (4 meters). U.S. airlines have grounded about 12,500 flights, stranding travelers, and U.S. stock trading is closed through tomorrow in the first back-to-back shutdowns for weather since 1888.
“This one has got so many facets to it -- you’ve got wind, you’ve got rain, you’ve got snow, you’ve got the full moon, you’ve got the storm surge,” said Doug Spiron, who is running home-improvement retailer Home Depot Inc. (HD)’s emergency response operations involving 350 employees in Atlanta. “Then there’s the impact of the sheer size of the storm. This one takes it to another whole level of preparation.”
Record tides from the storm combined with hours of pounding wind and rain to flood electrical substations and shut down New York City’s financial district. Consolidated Edison Inc., the city’s utility, killed power to parts of downtown Manhattan, including Wall Street, and Brooklyn, as the storm surge, boosted by high tide, sent saltwater pouring into its underground power network.
Before Sandy made landfall, the storm had knocked out power to more than 2.1 million homes and businesses from North Carolina to New Hampshire, according to utility reports. Power blackouts may eventually affect as many as 10 million people in the region for as long as 10 days.
Earlier, before the storm made landfall, rising winds caused the partial collapse of a crane at a West 57th Street luxury tower called One57, designed to be the tallest residential structure in Manhattan at 90 stories.
Sandy’s “size is enormous, with storm-force winds extending up to 1,000 miles from the center of the storm on both sides,” Annes Haseemkunju, an atmospheric scientist at Eqecat, said today by telephone.
As the storm progresses, economists and analysts have varying estimates on how much damage it will cause. Hurricane Sandy ultimately may subtract 0.1 to 0.2 percentage points from U.S. gross domestic product in the fourth quarter as spending drops on services such as restaurant meals, according to Mark Vitner, a senior economist at Wells Fargo Securities LLC in Charlotte, North Carolina. The economy, with annualized GDP of $13.6 trillion, expanded at a 2 percent pace in the third quarter.
“There’s a loss of activity that’s going to be hard to make up,” Vitner said. “If you’re a restaurant and you’re closed today, people are not going to eat two lunches tomorrow.”
Insured losses from the storm may reach $8.3 billion, with the largest portion in New York, New Jersey and Pennsylvania, according to an estimate from Kinetic Analysis Corp. compiled by Bloomberg.
Labels: World-News
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