>I've been kind of amazed that the stock market didn't finish below
>10,000 this week. Granted, it had a bad week, but you would think
>that these capitalist investors would see the handwriting on the
>wall. Leaving aside the $100 billion price tag that may be involved
>in saving and rebuilding New Orleans and the Gulf Coast, wouldn't
>the higher gas prices lead to inflation and other instability? The
>U.S. trade deficit is high, Iraq costs money, the Empire and
>homeland security cost money, so isn't everything set to go up in
>smoke?
The conventional thinking is that disasters are bullish. There's government aid and insurance payments (and maybe even an easier Fed), which fuel rebuilding. After a brief dip, reconstruction is a stimulus.
That may not work this time because of the impact on oil prices and the grain trade. But that's the accepted wisdom.
Doug