Sandy Total Loss Estimate: Up To $100 Billion

Tyler Durden's picture




 

In a stunningly accurate prediction of what to expect from a 100-year storm, the following 2011 report assessing the 'risk increase to infrastructure due to a sea level rise' provides everything you did not want to know about just how bad the situation is with recovery from Sandy's damage but were afraid to ask. Based on extrapolations from storm surge heights, the authors see a 'perfect storm' of this magnitude likely creating a total loss between $50 and $100bn. As Atlantic Cities notes, citing the report: The researchers also estimate that... it could take the subway system about 21 days to get working at 90 percent functionality. If all potential damage is considered, ...that timeline could increase to several months, and that "permanent restoration of the system to the full revenue service that was previously available could take more than two years."

 

Obviously these are only predictions, but the detail and prescience of the report are stunning in their accuracy now that the 'event' has occurred. Of course, the MTA has done whatever possible to prepare - and will do everything to get this vital infrastructure back in service but with the head of MTA noting this is the worst disaster ever, we suspect the 4-5 day estimate is over-promising.

 

The vast majority of New York City’s and the MEC region’s basic infrastructure (in its narrow sense of engineered structures and systems) was built and developed between about 100 and 50 years ago. This buildup occurred during the time of largest population influx, primarily driven by immigration. Today, with about 20 Million people living, working and commuting in its 31 counties, the MEC region is home to the largest public transportation system in the US...

 

...But without a properly functioning regional public infrastructure, private “Wall Street” and other major business sectors of the region could not exist. Infrastructure systems behave like inter-dependent growing organisms. This interdependence poses risks, however. If one system fails or under-performs, others can be severely affected...

 

Here is the prediction for storm surge areas:

...Note that for worst-case scenario storms stronger than Category 2, Lower Manhattan will be split into two islands, along Canal Street; i.e. the financial district would be entirely cut off from any escape routes. Entrances to subway, road or rail tunnels or ventilation shafts will be at or below flood levels, not to speak of the building stock and other assets that are located in the flooded areas... 

 

and the prediction for the effect on the Brooklyn-Battery Tunnel

...But regardless of climate change, the increasing potential for storm-related losses due to population and asset growth is already reason enough to address those risks and look for coping and adaptation strategies...

...The Metro East Coast (MEC) infrastructure, like the infrastructure in many other large US cities with an aged inventory, has suffered for many decades from deferred maintenance. This has created a huge demand for infrastructure capital spending to restore and expand the aged systems in the MEC region and elsewhere...

 

All losses discussed here are total losses related to a given event. They include insured and uninsured losses. They include losses from coastal surge, riverine flooding and wind damage. They apply to the entire built environment, not just infrastructure or transportation infrastructure...

 

Estimated Losses $50-100bn! - based on Storm Surge extrapolations:

 


 

 

 

This is accrued loss over the next 100 years from this storm (given its probability of occurrence) - but since the storm just hit then there is no accrual! A 13-14ft Storm Surge implies a $50-100 billion total loss now!

 

And a rather scary sounding conclusion:

The problem of sea level rise that New York City and the MEC are about to face will be faced by coastal megacities and shore-bound populations all around the US coasts, in fact around the globe, in rich and poor countries alike. New York City and the surrounding MEC region could be in the unique position to muster the financial and intellectual resources, perhaps even the communal political wit and will (sic!) to set a world-class example for how to deal with such a fundamental societal / environmental issue. NYC and the surrounding MEC could do so in par with its often self-declared status as the 'financial capital' of the world. The City that never sleeps? True or not, 'mother nature' will see to it that wake-up calls will abound.

 

NYC Worst Case

 

and the author of the study produced a more recent update - focused on the future of the Brooklyn Waterfront - unbelievable...

Nyctech Brwf 02-24-2012 Redux

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Tue, 10/30/2012 - 20:42 | 2933217 VonManstein
VonManstein's picture

the proverbial straw on the proverbial camel. sorry guys but i think thats it.

Tue, 10/30/2012 - 20:43 | 2933218 vast-dom
vast-dom's picture

KEYNESIAN WET DREAM!

 

 

ALL WE NEED NOW IS AN ALIEN INVASION....

Tue, 10/30/2012 - 20:45 | 2933223 FreedomGuy
FreedomGuy's picture

Obama's poll numbers will go up as Libya and the economy get off the front page. Alien invasion would ensure reelection. Bring it on.

Tue, 10/30/2012 - 21:07 | 2933284 maxmad
maxmad's picture

$100 Billion--now we are getting somewhat closer to the truth, however this thing will get over 1 Trillion!!  When you consider the New York Subways, all the flooded high rises... La Guardia... All those ocean front properties....

 

One Billion dollars!!!!  MMMMUUUUUUWWWWAAAAAHHHH!

Tue, 10/30/2012 - 21:12 | 2933303 maxmad
maxmad's picture

Reports are already coming out that Homeowners are finding out that they were "self-insured" even though they had been paying their premiums.... Ya gotta love these Insurance companies. "You pay every month, then when you have a claim-they deny you!"

Tue, 10/30/2012 - 21:26 | 2933342 Harlequin001
Harlequin001's picture

Perhaps this is the point where Americans realise that there are reasons why cities and towns develop only in certain areas, and unlike America, why they develop over thousands of years and not a few hundreds. Perhaps this is the point where Americans realise why native Indians didn't settle down and build houses in the path of hurricane's and tornados, and on geological faults.

Seems to me like a few million people just bought houses in the wrong place, and maybe should consider moving before disaster really befalls them. Alternatively of course, they could sit there and hold their hands out for more money when real calamity eventually arrives...

Tue, 10/30/2012 - 21:42 | 2933358 Zer0head
Zer0head's picture

Zuck you are tha man

the lovely Randi would be proud of her bro

big BALLS marky for pulling down this post on the seal page, you are a class act

 

http://specialoperationsspeaks.com/articles/facebook-censors-navy-seals-...

Tue, 10/30/2012 - 21:51 | 2933398 TruthInSunshine
TruthInSunshine's picture

21 days to get the subways to 90% capacity/operational functionality?

I'll bet against that by a factor of double (if not triple) all day and every day, bitchez.

 

Anyone in government who makes that claim is either a) lying, or b) functionally retarded.

Saltwater does a mission critical hit job on any ferrous metal/metal alloys it comes into contact with in vey short order. Unless the government brain trust wants to claim it's secretly ripped out subway tracks and given them a nice, thorough bath in zinc baths over the past several years, they're full of total shit.

Tue, 10/30/2012 - 21:57 | 2933412 DaveyJones
DaveyJones's picture

"the financial district would be entirely cut off from any escape routes"

and they call this a disaster

Tue, 10/30/2012 - 22:07 | 2933442 markmotive
markmotive's picture

Broken window fallacy...I think there are a few Kenesians that know this.

Peter Schiff on the hurricane and broken window fallacy:

http://www.planbeconomics.com/2012/10/30/peter-schiff-and-broken-window-...

Tue, 10/30/2012 - 22:18 | 2933468 dryam
dryam's picture

It's good to know this country has saved all these years for a rainy day.

Tue, 10/30/2012 - 22:49 | 2933537 Troll Magnet
Troll Magnet's picture

why save when jews can just print?

Tue, 10/30/2012 - 23:03 | 2933580 economics9698
economics9698's picture

Krugman just ejaculated.

Tue, 10/30/2012 - 23:31 | 2933645 Oh regional Indian
Oh regional Indian's picture

Make what you will of this:

http://presscore.ca/2011/?p=7507

ori

Wed, 10/31/2012 - 00:08 | 2933696 knukles
knukles's picture

There is enough data/scientific journals in the public domain that to assume there is no manipulation of these sorts demands extreme speculation.

Wed, 10/31/2012 - 00:18 | 2933720 Oh regional Indian
Oh regional Indian's picture

If I parsed your statement correctly...indeed. One just needs to take a look at patents granted. Especially since 1990.

ori

Wed, 10/31/2012 - 00:57 | 2933763 AldousHuxley
AldousHuxley's picture

What's the total loss to US economy from Shittibank's Sandy Weil and his protege Jamie Dimon?

Wed, 10/31/2012 - 01:11 | 2933775 Schmuck Raker
Schmuck Raker's picture

Stoopid question.

Whodathunk a tunnel under a river couldaflood?(Thads a genus guessdion.)

Wed, 10/31/2012 - 01:53 | 2933815 old naughty
old naughty's picture

Isn't that what Keynesian is about? Stoopid tunnels (whatever) repaired/replaced, a perfect ponzi.

But then they don't need a perfect storm to get perfect excuse to spend, do they?

More "debt = claim on future wealth".

Wed, 10/31/2012 - 02:33 | 2933819 Michaelwiseguy
Michaelwiseguy's picture

Who was it that said;

The greatest threat to our National Security is the financial collapse of our economy, and peoples ability to pay for natural disasters, that have been taken away from them by the Federal Reserve Corporation?

That would be me, over and over again. I don't even want to think about what would happen if California had a major earthquake these days.

Hurricane Sandy was intensified by considerable Geo Engineering operations.

Raytheon who holds the patents, Evergreen International and others should be Sued for damages, loss of life and property damage, for the operations they conducted intensifying the storm.

The Climate Changers and Progressers can go pound sand. We have global cooling now due the extended Solar Minimum.

NASA June 2012 Solar Cycle 24 Prediction

http://wattsupwiththat.com/2012/06/08/nasa-june-2012-solar-cycle-24-prediction/

Here's the proof of Geo Engineering Sandy;

Hurricane Sandy Geoengineering Update 10-27 and Law Suit   http://www.youtube.com/watch?v=W6XGUtvUmFo Hurricane Sandy Geoengineering 10-26-2012 Intellicast Update

http://www.youtube.com/watch?v=sXST3Naagbo

Aerosol Geoengineering and Hurricane Modification Program Run by Homeland Security

http://www.youtube.com/watch?v=lPbuOMSlDbA

GeoEngineering Exposed

http://chemtrailsplanet.net/

 

 

Wed, 10/31/2012 - 04:44 | 2933883 jeff montanye
jeff montanye's picture

abuse at the macro level and, o.t. but too good to pass up, at the micro:

http://rt.com/usa/news/taser-boy-playground-webb-611/

Tue, 10/30/2012 - 22:58 | 2933566 cranky-old-geezer
cranky-old-geezer's picture

 

 

100 billion?

That's less than 1% of what Bernanke has printed and given to banks (Wall Street and elsewhere).

NYC could enact a 1% tobin tax (tax on financial transactions).  Yep, tax every single HFT transaction.   At a thousand a second, yep, they'd raise 100 billion pretty fast.

What is sales tax in NYC?   9%?  10%?

But 1% on financial "sales" is too much?

Wed, 10/31/2012 - 00:20 | 2933723 redpill
redpill's picture

Seriously, only $100 bill? That's a fuckin champagne brunch in Bernankistan.

Wed, 10/31/2012 - 01:10 | 2933774 AldousHuxley
AldousHuxley's picture

God tried to wipe out greed on manhattan Noah's Ark style, but underestimated pile of shit they have built over there.

 

bring a bigger storm next time!

 

Meanwhile, top 0.1% busy asking government for bailouts and "emergency disaster area" to get tax writeoffs.

Wed, 10/31/2012 - 01:13 | 2933777 rambo1028
rambo1028's picture

Totally off topic

Schiff is so effing hot....

Oh what I wouldn't give for a few hours to pick his brain...or something. :)

Wed, 10/31/2012 - 02:10 | 2933829 cranky-old-geezer
cranky-old-geezer's picture

 

 

Why?  Schiff has nothing original.  All sorts of folks right here on ZH know way the fuck more than he does.

Tue, 10/30/2012 - 21:38 | 2933372 PLira
PLira's picture

Don't you fret your <insert adjective> little head. .Gov will pick up the tab for those who need it the least.

Tue, 10/30/2012 - 21:46 | 2933381 robertocarlos
robertocarlos's picture

Their insurance covers hurricanes. It doesn't cover floods.

Tue, 10/30/2012 - 21:48 | 2933389 Henry Chinaski
Henry Chinaski's picture

Somebody just told me it was downgraded to TS just befor it came ashore.

Tue, 10/30/2012 - 23:04 | 2933581 Oh regional Indian
Oh regional Indian's picture

Sneaky arseholes. It's all in the language and timing, isn't it?

Insurance, surely the most corrupt, intellectually dis-honest and morally bankrupt industry in the world.

ori

Wed, 10/31/2012 - 00:03 | 2933691 Oh regional Indian
Oh regional Indian's picture

If this really is/was fight club, I should be able to see who my junkers are. Many other web-sites will allow you to see who upped and downed you.

Minus that feature, this is Fight Club in panties.

Hey Tylers, how about a pink theme? Eh?

;-)

ori

 

Wed, 10/31/2012 - 00:22 | 2933728 Oh regional Indian
Oh regional Indian's picture

Hahahahaha.... panty junker strikes again.

 

Tue, 10/30/2012 - 21:16 | 2933304 Zer0head
Zer0head's picture

Krugman 1

Austerity 0

 

get over it NYC wimps

 

meanwhile Facebook censors Navy Seal re Benghazi

and meanwhile apartment 6a in the village has no power

 

clearly the latter is of most serious concern and subject of intense debat, I mean think of the suffering of those poor souls in lower Manhattan, may god watch over them and protect them - and to hell with the rest of the world 

 

 

 

Wed, 10/31/2012 - 07:22 | 2933933 nmewn
nmewn's picture

"and meanwhile apartment 6a in the village has no power"

As .gov tells the peeps to stay tuned to .gov for the latest...that they have no power is just a technicallity.

http://dyn.politico.com/printstory.cfm?uuid=9AA02838-0E81-4238-A537-30D68B6772A7

Tue, 10/30/2012 - 23:06 | 2933586 booboo
booboo's picture

100 Billion? Well if that number is meant to shock John Q public it should have the reverse effect and maybe they will realize that if 100 Billion will fix NJ and Ny city then the TRILLIONS shoveled into failed banks for propping up worthless paper assets was not worth it. 

Wed, 10/31/2012 - 01:23 | 2933793 rambo1028
rambo1028's picture

RIGHT ON THE MONEY!!!

Tue, 10/30/2012 - 23:14 | 2933606 hedgehog9999
hedgehog9999's picture

Reality hits hard Bitchezzz. That subway will take way past the year end to be fully functional barring some other 2012 eventuality.

And the costs will be way over 100 Billion bucks of devalued dollars and that does not even include the economic costs resulting from millions of conmmuters on a forced vacation for a few months.

That should increase the unemployment rate by a few points. Albeit temporarily....

Might be good for the car industry but not good for traffic.

Tue, 10/30/2012 - 21:44 | 2933300 TruthInSunshine
TruthInSunshine's picture

Totally off topic, but just a little light reading for everyone as I ponder how the Fed Head & his lapdogs at the Fed (as well as his masters), along with scumbag politicians, will continue to spin the "inflation is low" bullshit. The U.S. Government, fronted by the Fed, is determined to inflate their way out of their IOU tsunami, bitchez; hey, look!, here's one of those jagoff tools popping off right here:  10-30 20:27: Fed's Kocherlakota says 'strongly' disagrees that Fed easing is excessive

Says:
- Sees signs monetary policy as 'too tight'.
- Too early to tell the full ramifications of hurricane Sandy on the US economy.
- Unemployment could fall to 5% to 6% without pushing inflation above 2%.

 

 

$100,000 Income: No Big Deal Anymore

 

And some choice excerpts:

According to Labor Department statistics, the average inflation rate for 2011 was the worst since 2008, with consumer prices rising 3.1 percent, compared to an average of 1.6 percent in 2010. Much of this was fueled by energy costs (up 15.2 percent for the year) and food costs (up 3.7 percent for the year). Just to keep up with standard inflation, a $100,000 salary in 1990 would have to be $172,103.29 in 2011.

 

"What would have cost you $100,000 in 1976 would cost you $381,000 today. That's just the inflation, and there are so many other things that have grown very expensive," says Mari Adam, Certified Financial Planner and president of Adam Financial Associates in Boca Raton, Fla.

 

The Council for Community and Economic Research's Cost of Living Index, which compares typical family and individual expenses across hundreds of cities, shows that. According to the Index, for 2012 Q1, a typical family earning $100,000 per year would need to earn around $228,300 in New York City and $166,500 in San Francisco to maintain that same lifestyle.

 

The Council for Community and Economic Research's Cost of Living Index, which compares typical family and individual expenses across hundreds of cities, shows that. According to the Index, for 2012 Q1, a typical family earning $100,000 per year would need to earn around $228,300 in New York City and $166,500 in San Francisco to maintain that same lifestyle.

Wed, 10/31/2012 - 06:05 | 2933904 Harlequin001
Harlequin001's picture

What's the average wage now then, $60K or 100?

Just curious...

Tue, 10/30/2012 - 21:43 | 2933380 Tijuana Donkey Show
Tijuana Donkey Show's picture

Illegal alien invasion.......

Tue, 10/30/2012 - 20:46 | 2933226 FreedomGuy
FreedomGuy's picture

Illegal aliens? Can they vote Democrat?

Tue, 10/30/2012 - 21:31 | 2933355 bigdumbnugly
bigdumbnugly's picture

already do.

Tue, 10/30/2012 - 21:46 | 2933385 Almost Solvent
Almost Solvent's picture

But they are overridden by the GOP controlled Diebold corporate vote counters so really they cancel each other out in the end.

Wed, 10/31/2012 - 00:11 | 2933702 knukles
knukles's picture

The Diebold machine data is sent to a Spanish company for compilation and reporting that just so happens to be owned by George Soros.

Wed, 10/31/2012 - 00:54 | 2933760 AldousHuxley
AldousHuxley's picture

Too much fox news?

Wed, 10/31/2012 - 04:35 | 2933878 CompassionateFascist
CompassionateFascist's picture

Aldous, you are the acme. But in this case, knuckie has got it right. Judenraete George is, in fact, counting about 60% of the votes. Since we need Civil War II ASAP, and only the Kenyan can give it to us, this is all good. 

Tue, 10/30/2012 - 20:53 | 2933243 A Nanny Moose
A Nanny Moose's picture

That's a metric fuck-ton of broken windoze

Tue, 10/30/2012 - 20:45 | 2933224 fonzannoon
fonzannoon's picture

This has to be the black swan. Who the f is going to pay for this? The insurers? HA. No fkin way. They will croak trying. So when they deny the claim will FEMA cover it? If not then the tapped out consumer just got shot in the head.

Tue, 10/30/2012 - 21:00 | 2933251 JohnG
JohnG's picture

 

 

Reinsurers crapped thier pants for a week over this.  That's who gets fucked.  I see Allianz bankrupt in a couple months.  Appears State Farm has a huge stake also, so thier RI's are fucked.  It's both an infrastructure and financial disaster.  EPIC.

I just hope the rats are OK.  They took the brunt of it, and have no insurance.

The rat bastard bankers can go to hell.

Tue, 10/30/2012 - 21:07 | 2933285 Ineverslice
Ineverslice's picture

 

Liquefaction of yet another ponzi.

We'll see.

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