9/9/04
Hi,

For all of those of you who are wondering about the effects of the hurricane, at least economically the effects will be favorable. The $40 Billion +/- of damage will largely be rebuilt or replaced. In either case this $40 Billion will be economic stimulation to the Florida economy. That is the positive effect. The negative effect will take much longer, but homeowners and business insurance rates will soar to the point where 3 - 5 years from now we may see property taxes and homeowners insurance premiums about equal. This (the insurance premium) as well as higher interest rates should spell the end of the housing "bubble" in Florida for the forseeable future. Home prices could drop 30% or more within 3 to 5 years here in South Florida.

I am perplexed with the pricing of oil - first the rise above $45 per barrel and then the drop to $42 per barrel. It seems to me that we may see moderation in oil prices in the short term but long term, we should easily exceed $50 per barrel and prices should hold over $35 per barrel if not $40 per barrel going foward.

Arnold

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- posted by Arnold @ Thursday, September 09, 2004