Streetwise Professor

August 27, 2017

Riding the Storm Out

Filed under: Uncategorized — The Professor @ 11:08 am

Harvey has hit Houston with Biblical rains. I’m stocked up and off ground level, and searching the Internet for Ark plans. One of the most damaging hurricanes in Houston history was Allison, in June, 2001. Like Harvey, rather than hitting the city with devastating winds, it was a slow moving storm that inundated the city. Post-Allison Houston made efforts to increase drainage capacity, but the city is low-lying, and with all the pavement and buildings, this storm is likely to result in some pretty devastating flooding. How devastating depends a lot on how fast Harvey decides to get out of town.

It’s hard to get a comprehensive picture of things, especially at street level. You see pictures on the news or Twitter of flooded areas, but hard to know how representative that is. My street and the nearest major street are curb deep in water, and there are cars stalled.

All I can do is hang out and ride it out and hope for the best. Maybe given my enforced idleness I’ll write a substantive post in a bit 😉

And even though I’m not a big REO Speedwagon fan, this seems an appropriate way to pass the time.

Update. Sadly, there are parts of the Houston area where this seems more appropriate:

Braes Bayou, where I used to live, is over its banks. The place I first lived in here was a block from the Bayou, and had been flooded up to the door frames by Allison. (I moved in a year after it had been repaired.) I’m sure it’s flooded again.



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  1. Stay “Home & Dry,” SWP! (hat tip to Gerry Rafferty – )
    You are a national treasure! Looking forward to your posts.

    Best regards,

    P.S. Not a big REO fan either, but they have a place in the soundtrack of my youth.
    As do these German fellows –

    Comment by Mudak — August 27, 2017 @ 11:20 am

  2. Prof,
    In your upcoming post(s) about Pres Trump’s pardon of Sheriff Joe Arpaio,
    please be sure to cover the “cui bono” angle of the person who was pardoned
    and also, please compare & contrast to Bill Clinton’s pardon of Marc Rich,
    which was handled by Eric Holder. Might there have been a Russian connection?

    Comment by Mudak — August 27, 2017 @ 1:36 pm

  3. Best wishes, prof.
    No doubt you have put any stuff you value in the basement on old tables and chairs.
    Once the waters have receded and your dove has come back to the ark you can write a post about this.
    Why do infrequent but predictable events get insured in a rich country, but frequent and predictable events in poor countries (e.g. Indian villages in the monsoon) don’t.
    As far as I can guage Houston drainage water co was not insured for cataclysm.
    A fair amount of moral hazard around this.

    Comment by james — August 27, 2017 @ 2:17 pm

  4. Hang in there, Professor.

    Comment by aaa — August 27, 2017 @ 3:20 pm

  5. @aaa-Thanks. It’s what I do best 😛 The storm has constrained my mobility, but hasn’t affected me directly yet. High, dry, and supplied.

    The ProfessorComment by The Professor — August 27, 2017 @ 3:37 pm

  6. @james-Thanks. No basements in Houston! My storage facility is on the 2d floor too.

    The probability of say a hurricane can be estimated (I imagine that’s what you mean by predictable). But considering that say everywhere on the Gulf coast has the same probability, but there is no dependence between Pensacola or Mobile or Houston or Corpus getting hit, then diversification works. You can write policies in all these locations, and the independence reduces the variability of your claims. The more risks you can put in the pool, the more effective this diversification is.

    A village getting hit by the Monsoon every year isn’t a risk, really. Moreover, I am guessing that there is a considerable amount of dependence. But I would add that even if the independence/low dependence criteria is met, that transactions costs (or market failures, if you like) impede the development of insurance markets in someplace like India. One problem with insurance is the insurer absconding with premiums, and not paying off when claims come in. This is more likely in countries with a weak legal system. There’s an interesting book by Henry Hansmann titled “The Ownership of Enterprise” that discusses the evolution of insurance markets from a transactions cost perspective.

    The ProfessorComment by The Professor — August 27, 2017 @ 3:45 pm

  7. In Ertford, Ereford and Ampshire, and no doubt Ouston, Urricanes ardly hever appen.
    (My update of My Fair Lady)

    Good luck to you,maybe you should delete the info that Ouston don’t have no basements, just in case the NorKs are watching.

    Yes I get your notion of estimate, but estimable seems to this Brit so ambiguous. I meant probability per x year + or – property or life loss. A while back the weather was unpredictable, then some chap from Lloyds insurance markets did the research and came up with Pluvius. Now used even for church and school fetes.

    Thanks for the heads up on The Ownership of Enterprise, but at more than 30 quid on amazon (as a paperback!) I’ll wait till I buy my yacht.

    Comment by james — August 27, 2017 @ 5:33 pm

  8. SWP — looks to me like you may not have to start classes on time this academic year.

    Comment by Sam — August 27, 2017 @ 8:46 pm

  9. @Sam-Classes started on the 21st . . . but there will be a hiatus from at least last Friday through Wednesday. So there was a start, but a false start.

    The ProfessorComment by The Professor — August 28, 2017 @ 5:27 am

  10. Craig, Hope you and yours are safe and dry!. Is that an REO or Spinal Tap, sometimes its hard to tell…..

    Comment by J Conolly — August 28, 2017 @ 5:57 am

  11. Here’s to TX turning down any and all offers of federal assistance, so they can show the world what it means to be self-sufficient instead of living in serfdom. That would be a sight to behold.

    Comment by Job — August 28, 2017 @ 4:04 pm

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