>>PEGGY: FINANCIAL EXPERTS PREDICT THAT SUPERSTORM SUNDAY COULD COST $20ÊBILLION IN PROPERTY
DJ AND UP TO 30ÊBILLION DOLLARS IN LOST BUSINESS. AND THOUGH SAN DIEGO IS NEARLY 3,000 MILES
AWAY FROM WALL STREET, THE STORM'S FISCAL FALL OUT MAY BE FELT ON THE WEST COAST FOR
MONTHS TO COME. HERE TO EXPLAIN, IS MARNEY COX, CHIEF ECONOMIST
AT SAN DIEGO ASSOCIATION FOR GOVERNMENT. GIVE US AN OVERVIEW OF WHAT SORT OF ECONOMIC
DAMAGES CAN HAPPEN FROM A DISASTER LIKE THIS. >> >>MARNEY COX: THIS BUN'S PRETTY UNIQUE
IN THE SENSE IT'S BEING HIT. IT'S COMING INTO A MAJOR POPULATION CENTER,
PROBABLY 20% OF THE TOTAL NATION'S POPULATION LIVES IN THE AREA WHERE IT'S BEING IMPACTED.
SO THAT STARTS WHAT TYPES OF IMPACTS MAY OCCUR THERE.
OTHER KINDS OF PROBLEMS THAT MAY OCCUR BESIDES LOTS OF PEOPLE LIVING THERE, IT'S ALSO A MAJOR
PRODUCTION AND DISTRIBUTION CENTER; BOTH NOT ONLY DOMESTICALLY, BUT ALSO INTERNATIONALLY.
SO NOW IT HAS GLOBAL IMPLICATIONS. ANY TIME YOU BEGIN TO SHUT DOWN AN AREA THAT'S
CONNECTED TO THE ENTIRE WORLD AND DEPENDS UPON DAILY, HOURLY MINUTE CONNECTIONS, THEN
YOU DISRUPT THAT ENTIRE ECONOMIC PROCESS THAT GOES ON.
>> >>PEGGY: SINCE WE'RE TALKING ABOUT CONNECTIONS, MORE THAN 3 DOZEN FLIGHTS FROM SAN DIEGO ALONE,
THOUSANDS ACROSS THE NATION HAVE BEEN CANCELED BECAUSE OF THIS STORM.
WHAT SORT OF IMPACT DOES IT HAVE ON LET'S SAY LINDBERGH FIELD OR OTHER TRAVELERS OR
AIRLINES THROUGHOUT THE NATION? >> >>MARNEY COX: WELL, IT'S PART OF A TRANSPORTATION
SYSTEM. ANY TIME YOU DISRUPT ONE PARLT OF IT, IT'S
TAKING OFF AND LANDING AND SUPPOSED TO GO TO SOME PLACE IN THE AREA IMPACTING, THE PLANE
STOPS SOMEWHERE, WHAT DOES IT DO WITH ITS PASSENGERS, LOT OF PEOPLE GET STUCK IN PLACES
THEN THEY END UP IN AIRPORTS. THAT PUTS A LOT OF PRESSURE ON THEM.
THIS HAS A TENDENCY TO BUILD ITSELF OUT. YOU HAVE A LOT OF PEOPLE CANCELING THEIR FLIGHT
PLANS. THEY DON'T KNOW WHETHER OR NOT A WEEK KS TWO
WEEKS, HOW LONG DO I POSTPONE BEFORE I JUST DON'T GO AT ALL.
>> >>PEGGY: DOES THAT TRICKLE DOWN TO HOTELS HERE, ORÊ I KNOW SOME HOTELS HAVE DISASTER
CONTINGENCY PLANS WHERE THEY'LL LET TRAVELERS STAY.
WILL WE FEEL THAT IMPACT HERE? >> >>MARNEY COX: YOU KNOW, IT'S POSSIBLE THAT
SAN DIEGO'S HOTEL/MOTEL INDUSTRY WOULDN'T BE ALL THAT IMPACTED.
BUT WHEN YOU THINK ABOUT WHAT WOULD HAPPEN IN THE AREA THAT'S IMPACTED ON THE EAST COAST,
THOSE HOTELS ARE CERTAINLY GOING TO BE IMPACTED. BOTH BY THE PEOPLE WHO EITHER COULDN'T GET
OUT OR BY THE PEOPLE WHO COULDN'T ARRIVE. SO YOUR STUCK WITH A NUMBER OF DAYS AND BACK
TO YOUR POINT ABOUT THE SIZE OF THE IMPACT, 20ÊBILLION DOLLARS IN TERMS OF LOST OPPORTUNITIES
AND THEN ANOTHER 30ÊBILLION DOLLAR BUSINESSES YOU THINK ABOUT THAT'SÊ WE'RE IN ABOUT A
50ÊBILLION DOLLAR PER DAY ECONOMY. AND THAT EQUATES TO ABOUT 16ÊTRILLION PER
YEAR. SO WE'RE TALKING WITHIN A SHORT PERIOD OF
TIME, SAY TWO, THREE DAYS WE'RE HIT BY ABOUT THE SAME AMOUNT RIGHT THAT WOULD IMPACT THE
ENTIRE ECONOMY ON A DALE BASIS. THIS IS A PRETTY BIG IMPACT.
>> >>PEGGY: LET'S TALK ABOUT THE NEW YORK STOCK EXCHANGE.
THE FIRST TIME IT WAS SHUT DOWN SINCE THE 9/11 ATTACKS IN 2001.
COULD A DISASTER LIKE THIS BE A GOOD REASON TO BRING BACK THE PACIFIC STOCK EXCHANGE.
>> >>MARNEY COX: IF YOU CAN THINK OF AN ELECTRONIC CONCEPT THAT DIDN'T NECESSARILY DEPEND UPON
A A PARTICULAR LOCATION. THAT DOES NOT SPREAD ACROSS ALL THE FINANCIAL
TRANSACTIONS THAT TAKE PLACE IN NEW YORK. FOR EXAMPLE, THERE ARE ONES WHERE YOU SELL
BONDS, WHERE YOU'VE LITERALLY GOT TO GO OUT, FIND THE PEOPLE WHO ARE BUYING THE BONDS,
MOST OF THEM ARE LOCATED IN NEW YORK. IF THEY'RE NOT WORKING, YOU CAN NO LONGER SELL YOUR BONDS.
IF YOU CAN'T SELL YOUR BONDS YOU HAVE TO COME BACK ANOTHER DAY.
IF YOU COME BACK ANOTHER DAY, THAT MEANS THE MARKET'S INTEREST RATES ARE DIFFERENT.
SO ALL OF THOSE ARE COSTS. >> >>PEGGY: DOES THAT TRICKLE DOWN AFFECT
ACTUALLY IMPACT BUSINESSES IN SAN DIEGO BECAUSE THEY'RE DOING BUSINESS WITHÊ
>> >>MARNEY COX: I DON'T KNOW WHETHER OR NOT THERE ARE AGENCIES ORGANIZATIONS, COMPANIES,
THAT WERE BACK IN NEW YORK WITH TRANSACTIONS ON THE TABLE, BUT THESE ARE LITERALLY BILLIONS
OF TRANSACTIONS GOING ON EACH DAY. SO MY GUESS IS CALIFORNIA IS A BIG ENOUGH
STATE, SAN DIEGO A PIECE OF THAT, PROBABLY SOMETHING HAS BEEN IMPACTED.
>> >>PEGGY: WE DON'T HAVE A WHOLE LOT OF TIME LEFT, BUT I WANTED TO GET TO ONE MYTH, SOMETIMES
DAMAGE TO A STORM HIKE THIS OR A DISASTER CAN STIMULATE ECONOMIC GROWTH; IS THAT TRUE?
>> >>MARNEY COX: THE ANSWER TO THAT IS NO. THOSE RESOURCES WE'RE SPENDING TO REPAIR ARE
ONES THAT ARE REPLACING WHAT WE COULD HAVE SPENT THEM ON, AS OPPOSED TO REPLACING WHAT
THE STORM HAS DAMAGED. IT'S SOMETHING NEW THAT WAS HIGHER ON THE
PRIORITY LIST THAT NEEDED TO BE REPLACED OR UPDATED.
THOSE ARE REALLY LOST OPPORTUNITIES. YOU'VE GOT TO MAKE SURE YOU INVEST YOUR MONEY
IN THE RIGHT PLACES TO HAVE SUSTAINABLE GROWTH. >> >>PEGGY: SO NOT HELPING.
>> >>MARNEY COX: BUT IT STILL NEEDS TO BE DONE. THE U.S. WILL COME TOGETHER FOR THAT
INVESTMENT REQUIRED BACK THERE TO PUT THINGS BACK TOGETHER.
>> >>PEGGY: MARNEY COX WITH SANDAG, THANK YOU FOR TALKING WITH US.