March 29, 2024

Gas Rationing Is New Burden After Hurricane Sandy

“Can you believe this? This is crazy,” Mr. Kurasz, a Bayonne resident, said from the front seat of his silver Envoy. “I remember the last time we went through this, in the ’70s. It’s strange to be back here again.”

His plight mirrored that of thousands of others in New York and New Jersey, who, despite the best efforts of the government, were left without gas. Epic lines, frustration, disappointment and some confusion were the order of the day.

Gov. Chris Christie of New Jersey, Gov. Andrew M. Cuomo of New York, and the Pentagon made an all-out effort to speed gas to the troubled region. Mr. Christie ordered odd- and even-day gas rationing. Mr. Cuomo waved a tax for fuel barges, and told New Yorkers they could get 10 gallons of gas without charge from fuel trucks across the region provided by the federal government. Mayor Michael R. Bloomberg said police officers had to be sent to service stations to keep order.

But little seemed to work.

After swarms of drivers in New York descended to fill their tanks at fuel trucks stationed around the city — a line in the Bronx was three miles long, a National Guard spokesman said — emergency management officials decided to reserve the fuel for emergency vehicles and first responders because there was not enough to go around.

As part of expanding efforts to help the region, the Defense Department said Saturday that plans had been put into motion to provide fuel directly to gas stations in New York and New Jersey that have run dry. The department will send generators — along with National Guard troops to operate and secure them — to gas stations unable to pump fuel because they are in areas still blacked out by the storm, officials said.

But on Saturday drivers across the New York region were bundled in their cars, many boiling with frustration. Delmy Zelaya, 61, from Astoria, Queens, heard there was more gas in Brooklyn, so she drove there Friday night. She ran out of gas before finding a station — then abandoned her car. It took her two buses to get back home. The next day she was able to get gas at a Sunoco in Astoria, so she filled up a container and was on her way to return to Brooklyn via subway to retrieve her car. “I’m frustrated,” she said.

At the same station, Peter Cabot, who also lives in Astoria, said that people who were waiting in line had been getting into one another’s faces. “Every time that happens, they threaten to close down the gas station,” he said, adding that only angered people who had been waiting in line. “So it’s a Catch-22.”

Just before 7 p.m., the Astoria Sunoco station ran out of gas. Police officers arrived, cordoned off the area with caution tape and urged drivers to leave and find other stations. At least one driver could be heard cursing.

Few drivers in the region had a longer wait than Renee Blakely, 43, who was bundled up against the cold in the driver’s seat of her Saab on Saturday evening at a Mobil station in Bedford-Stuyvesant, Brooklyn. She said she arrived there at 4 p.m. Friday, left at 8 p.m. — leaving the car at the empty pump — walked to her home in Crown Heights, took a shower, made some soup, then returned at 4 a.m. She said she planned to remain in her car until gas arrived — whenever that might be.

“I got my iPod and my cellphone fully charged,” said Ms. Blakely, a bus driver for the Metropolitan Transportation Authority. “I’m just going to sit it out.”

She explained she did not want to risk running out of the little remaining gas in her tank while waiting in line at another station that had gas.

“I’ve been through worse,” she added, explaining that she had lived through three hurricanes while living in North Carolina and had also successfully battled cancer. “I’m a trooper. I can beat this.”

The various efforts from all levels of government also created some confusion. At a news conference late Saturday afternoon, Mr. Bloomberg said New Yorkers could take their cars to be refueled at federal trucks. But by that point, the decision had already been made that the fuel would be available only for emergency vehicles and first responders.

Outside the city, suburban residents also faced challenges. Mr. Christie’s plan for odd- and even-day rationing left some motorists confused — and frustrated.

“I mean, rationing? Really?” said Lucy Patrick, 51, from an Exxon station line in Bayonne. “I think I’m about to give up on the whole tristate area,” she said. “I’m thinking about moving to Miami. I know they have more hurricanes, but they seem better prepared than we are here. This is crazy.”

Reporting was contributed by Thomas Kaplan, Christopher Maag, Sarah Maslin Nir, Marc Santora, Kirk Semple, Thomas Shanker and Bernard Vaughan.

Article source: http://www.nytimes.com/2012/11/04/nyregion/gas-rationing-is-new-burden-after-hurricane-sandy.html?partner=rss&emc=rss

Strategies: In Economic Forecast Season, It’s Wise to Slow Down

That was essentially the outlook presented by Federal Reserve policy makers last week when they ratcheted up their assessment of the nation’s economic condition. They concluded that the economy is on a path of moderate recovery, so the Fed needn’t take further action right now.

That relatively sanguine appraisal also appears to be the consensus of most private economists and Wall Street strategists. “The best case appears to be a ‘muddle through’ outcome in which the U.S. maintains its current growth rate,” as Barclays Capital put it recently in its annual report on the global outlook.

Such views represent economists’ best efforts to predict the future. But how much credence should they be given? After all, a vast majority of economists, including those at the Fed and in the White House, didn’t foresee some of the most crucial developments of recent years, like the severity of the subprime mortgage crisis and the housing market’s decline, the onset of the financial crisis and the Great Recession, and the weakness of the subsequent recovery.

In this season of forecasts and predictions, it’s certainly worth remembering that navigating the economy of late has been like driving in a dense fog. In such conditions, when you don’t really know what lies ahead, it’s wise to proceed with utmost caution.

Let’s look at a few reasons to be skeptical about the “consensus” forecast:

First, not everyone subscribes to it. As I wrote in a recent column, the Economic Cycle Research Institute, an organization with an excellent track record, says the United States is actually heading into another recession, if it isn’t in one already. The institute was founded by Geoffrey H. Moore, an economist who helped originate the practice of using leading indicators to predict business cycles. It bases its conclusion on a series of proprietary indexes.

In an interview in the institute’s office in Midtown Manhattan, Lakshman Achuthan, its chief operations officer, acknowledged that recent data, like the drop in the unemployment rate from 9.0 percent to 8.6 percent, have been positive. But this doesn’t alter his view. He said the institute’s leading indicators — which incorporate data on purchases, inventories, credit, business and consumer confidence, housing, real estate, global trade and profitability — unfortunately continue to signal recession.

“It’s normal to see data that seems reasonably strong even when a recession is just getting under way,” he said.

Next, examine the Fed’s own projections. In a statement at the end of the Federal Open Markets Committee meeting last week, it said the housing market — usually an important component of a recovery — remains moribund. Moreover, it said, economic growth will be too anemic to have a low unemployment rate anytime soon. In this vulnerable time, “strains in global financial markets” — read, turbulence in the euro zone — pose a serious threat, it added. A financial shock could darken the outlook immediately.

Then consider the private consensus. Economists polled in December in the Livingston Survey of the Federal Reserve Bank of Philadelphia downgraded projections made only six months earlier, by estimating that real G.D.P. in the second half of this year would rise at an annual rate of only 2.5 percent, not 3.2 percent. For the first half of 2012, they project an increase of only 2.1 percent, down from 3.0 percent. These forecasts could rise again, of course — but could also easily fall again.

More troubling, the forecasts of both the Fed and private economists have been way off the mark in recent years. For example, in December 2007 — when the Great Recession started, as we now know — most economists inside and outside the Fed believed the economy was still growing. Livingston Survey economists at the time predicted growth in real G.D.P. of 1.9 percent in the first half of 2008, with a jump to 2.8 percent in the second half. Fed staff economists made a similar forecasting error, as Simon Potter, director of economic research at the New York Fed, documented in a recent blog post.

Perhaps even more disturbing is that on June 9, 2008 — in the middle of what would be the longest and deepest recession since World War II, Ben S. Bernanke, the Fed chairman, said he thought conditions were improving. Remember that Mr. Bernanke is a distinguished economist with a vast array of information at his disposal. Yet he said in Boston, “The risk that the economy has entered a substantial downturn appears to have diminished over the past month or so.” In fact, the housing crisis was deepening, and the financial system and the economy would soon go into a tailspin.

Some of this is entirely understandable. After all, even predicting tomorrow’s weather is risky. Will it rain? Will it sleet? Will it snow? Often, we don’t know until the last second. Why should policy makers be expected to accurately predict the combined behavior of millions of people and enterprises in a complex and global economy, months in advance? Try they must, but perhaps it shouldn’t be surprising if the effort often seems little more than highly educated guesswork.

WHAT may be less obvious is that it’s not only predicting the future that’s difficult; measuring economic activity that has already happened is a Sisyphean task. A seemingly simple benchmark like the quarterly G.D.P. growth rate is published and revised seven times by the Bureau of Economic Analysis. Those revisions are sometimes significant, particularly at turning points in economic growth.

“When you’re building forecasts on a baseline that’s shifting, it can be very, very difficult,” said Steve Landefeld, the bureau’s director, in a phone interview last week. Brent Moulton, an associate director, explained that G.D.P. is a statistical compilation of data from about 200 surveys from 38 federal agencies, plus myriad private reports. The numbers are changeable.

And following them too closely can be misleading. On Aug. 28, 2008, for example — now known to have been the eighth month of the Great Recession — the stock market rallied on an upward revision of the G.D.P. from April to June, perhaps feeding into a false sense of security. As it turned out, that number was later revised downward, as was the G.D.P. for the previous quarter.

Research by Jeremy J. Nalewaik, a Fed economist, suggests that another measure — gross domestic income — has provided a better indication of where the economy has been heading in recent periods. Right now, it may be signaling trouble ahead — though the research so far is inconclusive.

It’s possible the fog will lift and we’ll find ourselves in a splendid period for the United States economy, which has lately seemed stronger and more resilient than those of many other parts of the world. But we don’t really know.

Article source: http://feeds.nytimes.com/click.phdo?i=ac39bb13c55213f65ac40302c84cb191

Wealth Matters: Using an Inheritance to Teach Your Problem Child a Lesson

But it’s sometimes difficult for parents to find the right balance between making financial and professional resources available and encouraging their children to grow into independent adults. I have written a lot over the years about the counsel that parents seek to help them do this. A whole industry now exists around “next generation” advice and about how to “launch” children into adulthood.

And let’s be honest: if affluent parents were not anxious that their children could end up as alcoholics, say, or plagued by bad decision-making, this industry would not exist.

But what the industry doesn’t play up is what happens when the best efforts fail and the children end up troubled. At some point, those parents will have to decide what to do about leaving money to their problem children. And if they do not come up with a plan first, that money could make a bad situation worse.

“Everyone today is worried about their children even though their children are wonderful right now,” said Jerry Hersch, of counsel at the law firm Carlton Fields and an adjunct professor at the University of Miami School of Law. “They worry, ‘My child is going to marry someone who is going to take him for a loop. Or what happens if my child is in an auto accident and someone sues him?’ ”

So what should parents do? Advisers say this is among the toughest conversations to have.

“Some couples, it comes out pretty quickly, but for most people it’s not a conversation they’re willing to have,” said Jean A. Dorrell, president of Senior Financial Security in Summerfield, Fla., a town next to The Villages, a large retirement community. “Then I say, ‘Which one of your children do you trust the most to handle your financial affairs.’ People will say, ‘This one isn’t good with money’, or ‘This one is, but we don’t trust her husband.’ That’s how I open the conversation.”

If ever there was a Pandora’s box for parents, this is it. Do parents leave more money to the good children and less to the bad ones, or vice versa, since the bad ones will presumably need more help? Is there a way to use an inheritance, regardless of the size, to give incentives for better behavior? What do you do if a child has turned out fine but has married someone you think will take your money and run?

There are many options to protect your children from themselves but the options are the epitome of tough love. Still, they could help your child in the end.

RESTRICT ACCESS Money does not cause problems, but it can sure accelerate them. The simplest strategy is to choke off that fuel.

Trusts are a popular way, but for they can seem complicated and expensive to set up. Ms. Dorrell said she often recommended simple annuities for clients who had life savings in the hundreds of thousands, not millions, to restrict how the money was passed to heirs.

By titling the assets precisely through a beneficiary designation form, the money can be distributed as the parent wants. If the problem child dies before the term of the annuity, whatever is left can stay in the family line.

For those who worry about how their child will feel about their decision to, for example, restrict the money in the inheritance because of a spouse, Ms. Dorrell offers solace. “I tell them, ‘Your child knows how you feel about their spouse.’ ”

Plus, cutting someone out of your will may feel satisfying at the moment, but if the goal is to get a child to change, it rarely accomplishes that. Anne Marie Levin, vice president at PNC Wealth Management, recalled a client who came into her office seven years ago with the intention of cutting off her daughter, a drug addict.

The client had a net worth about $10 million. “She said, ‘The last thing I want to do is leave her an inheritance,’ ” Ms. Levin said. “I said: ‘The last thing you want to do is abandon her. What if she needs rehab? Or help paying her rent?’ ”

INFLUENCE BEHAVIOR Other strategies seek to use a carrot-and-stick approach to encourage children to act in a desired way.

Article source: http://feeds.nytimes.com/click.phdo?i=41d7e4f12c330a0441e55bdd55784e3e