Robert Hunter, director of insurance at the Consumer Federation of America expects flood damage from Hurricane Harvey alone to cost at least $35 billion and estimates only 20% of 250k Houston area homes underwater actually possess flood insurance. Furthermore, Pete Mills, a senior vice president at Mortgage Bankers Association declared, “There’s going to be a huge uninsured economic loss here.” With those statistics, Mills states the obvious. For perspective, according to the Insurance Information Institute, Sandy resulted in $8.4 billion in payouts for flood damage from the federal insurance program and after Katrina in 2005, the program paid out $16 billion.
My concern relates to the Federal Emergency Management Agency (FEMA). According to a recent report by the U.S. Government Accountability Office, FEMA runs the flood program, and already owes the Treasury about $23 billion in funds borrowed to cover the cost of past disasters.
This has forced the hand of President Trump to push back the debt ceiling yet again to finance this recovery. When news of the debt ceiling being pushed dropped, the national debt soared right over 20 trillion dollars and continues to climb. To make waters muddier, there are serious talks of eliminating the debt ceiling all together. President Trump confirms he discussed the idea at an Oval Office meeting with top congressional leaders last week. There seems to be a substantial amount of support in eliminating the debt ceiling but less agreement regarding what to put in its place, if anything. Steve Bell, a senior adviser at the Bipartisan Policy Center said “The debt limit, as a legislative vehicle to slow down spending, has been an utter failure and counterproductive.” No matter what happens, Congress would need to pass legislation to make any change.
In other news, North Korea continues to reject any peaceful solution presented by the Security Council even when supported by China. They repeatedly make egregious remarks toward the United States, South Korea, and even Japan for “dancing to the tune.” They responded to the latest Security Council resolution, which was backed by China and Russia, by echoing destructive threats to the United States, Japan and South Korea. Their statement included disgusting sentiment such as, “Let’s reduce the U.S. mainland into ashes and darkness”, and threats to use their nuclear weapons to “sink” Japan.
With the U.S. seemingly under attack by weather, debt, and threats of nuclear war, gold and silver continue to show extreme upside. They both have broken through some key resistance points and stand ready to hedge if the market or dollar needs it.
I again cannot stress the need to be properly insured. Do not suffer as the unfortunate 80% without proper insurance in Houston. My heart goes out to them! But, beyond insurance for your home and life, insure your wealth as well. Contact us today to learn about “wealth insurance” and how to utilize physical gold and silver properly to help you withstand an attack your dollar.