December 28, 2004

Tsunamis' Possible Economic Effects

Early guesses indicate the deadly tsunamis won't hurt U.S. insurance companies. That means the U.S. economy shouldn't see a direct economic effect. But there could be indirect effects to the U.S. economy. That area of Southeast Asia is a source of cheap labor. Look on the tags of your clothes and you'll probably read "Made in Thailand" or "Made in Indonesia" on it. The tsunamis could disrupt a lot of production. That could mean temporary shortages or higher prices on some imports, at least until manufacturers can move production.

"U.S. Insurers Seen Little Exposed to Asia Tsunami"

UPDATE: It's good U.S. insurers have little exposure in SE Asia. They had a rough 2004 with U.S. hurricanes and Asian typhoons. Here's a "wow" statistic I found:

Total insurance premiums per capita in the U.S. averaged $3,638 last year, according to Swiss Re. In Indonesia, the average was $14.50.

"Insurers Took a Hit in 2004"