Brian Beaulieu has served as CEO and Chief Economist of ITR Economics™ since 1987, where he researches the use of business cycle analysis and economic forecasting as tools for improving profitability.
While we often carry ourselves as heartless economists to preserve our unbiased analysis, our thoughts and hearts go out to the victims of Hurricane Ian in Lee County/Fort. Myers, Florida.
The human toll is numbing, and the property toll is staggering. Imagine being told you will have no power for at least 30 days. No potable water. Your home had 7 feet of water on the first (and frequently only) floor. Ninety-eight percent of the power grid in Cape Coral is said to be decimated. Then there are the folks on Sanibel Island, whose causeway was destroyed because the sandbars that were part of the support system were simply washed away. Until yesterday, boats were their only link to necessities.
There may be a tendency to think that the people impacted by Ian can afford the devastation. Second homes, beautiful boats, and all that. Take it from someone who lives just south of Fort Myers: “real people” are impacted, and they are in a very real position that none of us would want to be in. The pain and uncertainty are real.
Through the years, we have studied the impact of hurricanes, earthquakes, and other natural disasters. The local and regional impact is egregious, but the macroeconomic impact is limited. The US is so geographically big. The US economy is the biggest on the planet (and will be for generations, but that is a different blog). From hurricanes that have taken out swaths of the Gulf Coast to Superstorm Sandy, it does not track that the local and regional devastation has a demonstrable impact on US GDP, US Retail Sales, US Personal Income, etc. FEMA moves in, normalcy is restored to as many people as possible and to the extent possible, and the juggernaut that is the US economy keep going.
Why this topic?
We do not expect the economy in general will be derailed or subsequently aided because of Ian. Local and regional ramifications will be real. However, unless you are servicing Southwest Florida exclusively, do not alter your plans and budgets for the future.