Late comedian George Carlin's classic weatherman routine stated the obvious in meteorological terms: “Tonight's forecast: Dark. Continued dark throughout most of the evening, with some widely scattered light toward morning.”
The same can be said about the economy. Some key indicators suggest scattered light: slowly rising home sales and values, increased car sales spurred by the federal “cash for clunkers” program, a slowdown in mass layoffs. On a macro scale, the Federal Reserve is slowing down its purchase of $300 billion in Treasury securities, which helped keep rates low on mortgages and other loans.
In the insurance sector, it's still continued dark. The most recent numbers show that insurance industry employment is still down, behind the economy in general (for a look at how AA&B readers are economizing, see the results of our exclusive online survey on page 40). Forget the stock market; real economic recovery is built on what employers are doing. If people are unemployed or worried about losing their jobs, the economy will remain in the doldrums.
It also has been a pretty grim year so far for insured cat losses: winter storms in Europe, earthquakes in Italy and Japan, wildfires in Australia, a typhoon in Taiwan and severe storms in the U.S.–Munich Re puts first-half cat loss numbers at $25 billion. And more wild cards could lie ahead: experts are predicting that the swine flu virus that struck globally this spring may rear its ugly head again this fall when the original H1N1 virus could transmogrify into something more severe (see our Industry IQ for more on swine flu).
Another wild card in the bid for recovery is how federal legislation, specifically health insurance reform, will affect the insurance industry and the economy at large. Although volumes have been written, blogged and spoken on the subject, one of the few points of agreement is disagreement–most of it vociferous and virulent.
During the '60s, people engaged in mass public protests to demonstrate their disapproval of government actions or inactions. Although many of these ended in violence, some of the most peaceful were also the most effective, resulting in real change. Think of Martin Luther King's March on Washington or even Woodstock.
Although the violence surrounding today's contentious issues is mostly verbal, it's just as harmful to the nation's already damaged psyche as the riots at Kent State and the 1968 Democratic National Convention in Chicago. Social media provides us with more public forums than ever before; yet when faced with a divisive issue like health insurance reform, most eventually devolve into platforms for polarization.
Even if the economy gradually heads into scattered light, we'll still be plagued with darkness until we can somehow restore some sort of reasoned form of civil discourse to our public debates on issues that affect us all.
Want to continue reading?
Become a Free PropertyCasualty360 Digital Reader
Your access to unlimited PropertyCasualty360 content isn’t changing.
Once you are an ALM digital member, you’ll receive:
- Breaking insurance news and analysis, on-site and via our newsletters and custom alerts
- Weekly Insurance Speak podcast featuring exclusive interviews with industry leaders
- Educational webcasts, white papers, and ebooks from industry thought leaders
- Critical converage of the employee benefits and financial advisory markets on our other ALM sites, BenefitsPRO and ThinkAdvisor
Already have an account? Sign In Now
© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
