Hurricane Irene: And the Cost to NYC Will Be…?

If Hurricane Irene rolls into New York City—the nations most densely populated area—it could threaten millions of lives, but also cost tens of billions of dollars and “tangibly increase the chance of a recession,” Nate Silver writes on the New York Times FiveThirtyEight blog. “The good news is that such a storm would have to make something of a bank shot”—theres about a 5% to 10% chance of that. But even a more likely landfall on Long Island would cause $10 billion in damage in NYC.

Analyzing 20 tropical cyclones that have landed north of Mason-Dixon since 1903, Silver looks at wind speed, distance from Manhattan, and fatalities to calculate various financial scenarios for Irene. A worst-case Category 4 or 5 hurricane is probably impossible , but would costs trillions and cause “incalculable” damage to the world economy. Irene, on the other hand, is “an extraordinarily dangerous but not apocalyptic storm,” writes Silver. “But New York may be put to the test. Stay safe.”

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