California's Economy May Get Post-Fire Boost - Barron's

California's worst wildfires in four years have wreaked more than $1B in damages, killed 22 people, and left more than 600,000 displaced -- yet Barron's says the destruction could prove a boost to the state's economy. "It's an oddity of economic accounting... but the sharp initial pain could possibly turn into long-term stimulus," Alan Gin, an economics professor at the University of San Diego, told the magazine. Some 3,000 homes destroyed will need to be rebuilt, which Barron's speculates will result in lots of work for contractors and carpenters. One economist said homebuilding would stimulate the economy for the next 6-12 months. Among those with a major presence in the state, Barron's notes, are Standard Pacific and KB Homes. Meanwhile, Lehman Brothers has said individual insurers should find costs manageable, even if they reach $3B. Allstate, with a 13.4% share, is the most highly-exposed publicly-held insurer. On the downside, Barron's says consumers across the country may see higher prices at the supermarket for items such as avocados, as San Diego County's agriculture industry also may take a hit.

Sources: Barron's
Commentary: Can Housing Be 'Rescued'? • No Point in Bottom-Fishing the Homebuilders
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Comments

[inca jones]

hi. first post. booyah.

[gordon]

Barron's thinks they're an expert on everything! Even when they are ignorant of the facts,that is, when they aren't pumping individual stocks for the benefit of their clients(so they can unload on the spike). I live in San Diego. The only work soon, after clearance ,will be civil engineers/planners who will have to comply with new design codes established since the Cedar fire 4 yrs ago, like stuccoed roof overhangs, etc. The planning will take at least a year, maybe some framing starts in 18 months at the earliest. All the overbuilt condos /condo conversions going into foreclosure can be rented, that might help the banks.Rents should rise, great for consumers.Disposal agencies will boom. Sandbag supply before the rains will boom.