1. Report Completed: 01/10/2008
In the Name of Allah, the Beneficent the Merciful
Topic: New Orleans' Artificial Inflation
New Orleans is in peril. Why? How is it that the housing market all over the US is going
down? Prices going down? Yet, New Orleans housing prices are skyrocketing? Before Hurricane
Katrina, you could rent a house for $500 a month. After Hurricane Katrina, it’s about $1500 a
month. It’s called “artificial inflation”. This is when prices are raised up in a micro-economy due
to a sense of scarcity. True. Land is scarce in New Orleans. However, due to the scarcity of
“homes”, home prices, land value, and rental property prices are skyrocketing to phenomenal
heights! The cost of living has also went up. This explains why there is little effort to rebuild New
Orleans. It allows those that are rich to buy up those properties, or live there, while disallowing
those who are not so rich to come back and re-establish themselves back in their hometown. Now
billions of dollars have been sent to New Orleans in order to rebuild. Why is the rebuilding
process so slow? That’s because those billions went straight to the contractors’ hands and not the
local government’s, where the contractors would have to abide by the municipal, or city
regulations and mandates in order to receive those funds. In other words, those contractors
received free money from the federal government with no obligation to expedite, or speed up, the
rebuilding process. The biggest contractor in New Orleans being-- That’s right, you guessed it…
Halliburton. That’s so happens to be the biggest contractor in Iraq, and y’all see how fast Iraq is
being rebuilt.