In Bastiat´s day it was about “Broken Windows”. The modern equivalent is “Broken Cars”

Fallacies are only fallacies because they are durable

The auto industry could see a boost from consumers who delayed purchases or need to replace vehicles once life returns to normal for those affected by Hurricane Sandy, according to a recent report from car-shopping website Edmunds.com.

Edmunds Chief Economist Lacey Plache noted that there were about a half-million damaged vehicles during Hurricane Katrina in 2005, which affected a much less populated area than New York and New Jersey which were hit by Hurricane Sandy.

“Sandy’s impact may well be higher, but even if 100,000 damaged vehicles are replaced by the end of the year it could boost auto sales three to four percent for the quarter, and that has a positive effect on the economy overall,” Dr. Plache said.

What Mr. Lacey Plache left unsaid is that deep down he prays for Sandy´s “sisters” to pay a visit every couple of years. Why wait for seven long ones?

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3 thoughts on “In Bastiat´s day it was about “Broken Windows”. The modern equivalent is “Broken Cars”

  1. What if the economy operates under its potential and there is (hoarded) money available? Then buying a new car with such money could indeed boost the RGDP. What do you say?

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