On Sunday, January 12, 2025 at 9:01:36 PM UTC-7 Brent Meeker wrote:
On 1/12/2025 10:35 AM, Alan Grayson wrote: On Sunday, January 12, 2025 at 5:36:07 AM UTC-7 Alan Grayson wrote: On Sunday, January 12, 2025 at 2:43:02 AM UTC-7 Brent Meeker wrote: On 1/11/2025 2:16 PM, Alan Grayson wrote: On Saturday, January 11, 2025 at 1:55:12 PM UTC-7 John Clark wrote: On Sat, Jan 11, 2025 at 2:17 PM Alan Grayson <agrays...@gmail.com> wrote: *> What isn't being discussed is the likely banking crisis as a result of these fires. With entire neighhoods burning out of existence, I wouldn't be surprised if there's a Trillion+ dollars of bad debt being created, as homeowners default on their mortgages.* *The figure I've heard is $135 billion in fire damage, it would take more than that to cause a banking crisis. * *John K Clark See what's on my new list at Extropolis <https://groups.google.com/g/extropolis>* That's just a preliminary estimate for rebuilding houses and *total *infrastructure replacement. Three months ago, State Farm, a major insurance company, cancelled 70% of its fire insurance policies in the LA area, so I infer that most homeowners are uninsured, and those that are, likely won't collect anything since insurance is not structured for this type of near global disaster and many will declare bankruptcy to avoid paying and going under. Fire Insurance works when there are sporadic fires, not as in this case where entire towns are wiped out, like Altadena, north and east of Pasadena where I resided when I worked for JPL, and Pacific Palisades, and some others. Given the number of homes totally destroyed and the likely lack of insurance among a majority of residents, IMO the total damage, including mortgage defaults, could exceed one TRILLION dollars. AG Remember, those properties were almost all insured. The insurance companies also buy reinsurance so they spread the risk further. A trillion dollars is probably high for rebuilding everything. There were around a thousand homes and buildings burned, I'd estimate around 500K$ per house to rebuild. The insurance companies will pay off. They many not want to insure new homes, but the state may require them to or else not do any business in CA. Brent The number of buildings burned is around 10,000 and counting, and probably most were not insured for fire. I have a friend from JPL who lives in La Verne and he's not insured for fire because, he said, the annual rate is too high. He mentioned it as $15,000. Leaving CA could be the best option for insurance companies rather than going bankrupt. AG Latest estimate of buildings burned is 12,300, and median cost of rebuilding a home, say in Altadena, is $1.3 million. Really? That sounds more like the median *price*, which includes the land. Most places around L.A. the land accounts for 1/3 to 1/2 of the price of a house. Last I checked construction cost was around $250/sqft, but of course that's likely go up a lot with rising demand. Brent The Altadena fire came very close to JPL, but I was relieved to see it's still intact. Altadena borders north and east of Pasadena and seems totally wiped out. AG Still a long way to one Trillion, but these estimates do not include mortgage defaults. I'll ask my friend if mortgages require fire insurance. I know he doesn't have such insurance. AG -- You received this message because you are subscribed to the Google Groups "Everything List" group. To unsubscribe from this group and stop receiving emails from it, send an email to everything-list+unsubscr...@googlegroups.com. To view this discussion visit https://groups.google.com/d/msgid/everything-list/f3b3bd1d-f069-4bda-8871-6b4e21fd6748n%40googlegroups.com.
