Time reports: Even before Hurricane Sandy made landfall on the East Coast of the U.S., economists were predicting that the historic storm would cause billions of dollars in damage across more than a dozen states where planes were grounded, stock exchanges were closed, public transportation was halted and homes began to get pounded by devastating wind and torrential rain.
By Monday, disaster-modeling company Eqecat estimated that Sandy would cause $5 billion to $10 billion in insured losses and $10 billion to $20 billion in economic damages. (In 2008, Hurricane Ike had similar economic damages at $20 billion.) Others have estimated as much as $100 billion in damages. The real cost is probably somewhere in the middle. For example, Peter Morici, a business professor at the University of Maryland, is estimating up to $45 billion in losses by comparing Sandy with Hurricane Irene when it hit the Northeast in 2011.
The initial estimates last year for Irene were around $7 billion, but it eventually caused about $10 billion to $15 billion worth of damage. Morici says he’s predicting a similar increase from the estimate to the actual damages for Sandy considering the size of the storm, the number of Americans who will be affected (estimated around 60 million) and the possibility that metropolitan areas like New York City and Washington, D.C., could essentially be shut down for several days. [Continue reading…]