Spending up a $30B storm
By Paul Tharp, December 1, 2012
New York’s struggling economy could see more than $30 billion in windfall cash flows from replacing homes, clothing, cars and even jewelry lost in Superstorm Sandy, experts say.
“People lost between 150,000 and 200,000 cars that will have to be purchased right away in the Northeast,” said economist Henry Mo, director of economic research at Credit Suisse.
“Construction activity will increase in coming months and last much longer, probably for years, because there’s so much planning and preparation involved before actual construction starts,” he told The Post.
Hundreds of millions in cash have already been handed out in the Big Apple from emergency federal aid and charitable donations to provide shelter and personal needs, resulting in scattered shortages and higher prices in goods ranging from plywood to propane.
To cash in, companies are rushing to build inventories that already had been thinned by austerity issues well before Sandy hit, leaving stockpiles depleted or ruined from the storm’s wrath, analysts said.
“Several industries are critical in the rebuilding of areas hurt by Sandy and are readily preparing for the demands on them,” said Samara Zippin, an analyst at Sageworks, a financial information company.
Zippin said that this year landscapers, building-materials dealers and transportation construction firms have enjoyed sales gains of as much as 18.7 percent in some sectors.
“We expect to see strong sales through the end of the year and beyond as these industries work overtime and produce higher inventory to restore the Northeast,” said Zippin.
Even jewelry sales — not exactly essentials — could rise to new holiday highs in the metro area as customers seek to replace treasured keepsakes lost to the storm.
“Jewelry marks special events in a person’s life, and they expect to have it forever. It’s vital and they’ve absolutely got to replace it,” said Amanda Gizzi of the Jewelry Information Center, predicting a boost in the industry’s $71 billion in annual revenue.
Credit Suisse expects sales of appliances, apparel and household goods to show occasional monthly jumps in 2013 as insurance checks start arriving, which can cover anywhere from 25 percent to 75 percent of the insured value of property.
For the full story featuring Sageworks visit New York Post - Spending up a $30B storm.