WEATHER

New Orleans Goes Dark

Hurricane Ida slammed into Louisiana on exactly the same date, Aug. 29, as Katrina did in 2005. Ida made landfall as a Category 4 hurricane with 150 mph sustained winds, slightly more powerful than Katrina’s Category 3. 

The entire city of New Orleans was left without power, according to the regional energy provider Entergy. As of late last night, the only power to the city was coming from generators.

Quick rewind: In addition to killing more than 1,800 people, Katrina caused more than $100 billion in property damage, mainly due to the storm surge overwhelming the levees that were built to hold it back. A $14.6 billion risk-reduction plan was put in place after Katrina in order to contain those surges.

The economic impact

While we don’t know how the new flood prevention measures held up as of this morning, we do know that Ida struck a crucial energy infrastructure hub along the New Orleans-Baton Rouge corridor. 

• Louisiana’s refineries make up almost 20% of the country’s total refining capacity.
• And 60% of gasoline used on the East Coast comes from Gulf Coast refineries.

So basically where Ida is striking is “the just absolute worst place for a hurricane,” Weather Underground founder Jeff Masters told the AP. If refineries suffer a direct hit, gas prices could rise by about 10 cents in many East Coast markets.

Along with its threat to energy infrastructure, Ida also presents a logistical challenge for the Louisiana hospitals treating more than 2,400 Covid-19 patients statewide. Without electricity, hospitals will need to rely on generators to keep life-saving ventilators running. 

Looking ahead...this is the beginning, not the end, of the Ida story. “There is no doubt that the coming days and weeks are going to be extremely difficult for our state and many, many people are going to be tested in ways that we can only imagine,” LA Gov. John Bel Edwards said yesterday.

HEALTHCARE

Got Oxygen?

As if the Southeast US didn’t have enough to deal with already, hospitals are running low on oxygen for treating Covid-19 patients, and it’s causing ripple effects for other industries that use the stuff for their daily operations.

Big picture: The number of people hospitalized in the US with Covid-19 has exceeded 100,000 for only the second time in the pandemic. Because Covid attacks the respiratory system, patients with severe cases often require highly concentrated oxygen to help them breathe.  

But diverting oxygen to hospitals to treat Covid-19 patients means it can’t be deployed for other uses. Uses like...

Water treatment: Earlier this month, Orlando Mayor Buddy Dyer asked residents to hold off on activities like power washing the deck in order to conserve water. Liquid oxygen is used to treat the water supply, but the city is running low because of the crush of Covid hospitalizations.

• Florida’s Hillsborough County (home to Tampa) said last week that residents might notice a change in the smell or taste of their drinking water, since the water utility needed to switch up its treatment process due to the lack of oxygen.

Space: Turns out, to get to a place where there’s very little oxygen, you need a lot of it as a propellant for rockets. On Friday, NASA delayed the September launch of an earth-surveillance satellite because of the Covid-induced oxygen shortage. Other launches across the industry may be pushed back, too. 

• At a space conference last week, SpaceX President and COO Gwynne Shotwell said, “We certainly are going to make sure the hospitals are going to have the oxygen that they need” for Covid patients. But if anyone has some liquid oxygen lying around their basement, “Send me an email."

Zoom out: It wouldn’t be a 2021 business story without a supply chain angle. Health officials say a shortage of truck drivers with the specialized skills to transport oxygen is compounding the problem. 

HOUSING

High Rents Are Back

The No. 1 comeback story of the year isn’t jeans—it’s rental prices.

In the first half of the year prices have increased more than 11%, well above the broader inflation rate. Now, rent prices in 87 of the country’s 100 largest cities have fully returned to pre-pandemic levels. 

The website Apartment List explained some of the trends behind the trend.

• Moving out: During the beginning of the pandemic, young renters left the big city to hole up with their parents. Now, after one too many times being asked to empty the dishwasher, they're looking for their own places.
• Buying a house is too expensive: Skyrocketing housing prices are causing some would-be homeowners to choose renting instead.
• A sense of urgency: People aren’t browsing Zillow to pass a slow day at work—they want to rent right now, crowding the market with high-intent customers.
• There isn’t enough housing available, which, of course, drives up prices.

Bottom line: “When it’s all said and done, 2021 will go down as a year when housing affordability went from bad to really bad, especially in mid-sized markets,” per Apartment List’s Rob Warnock. 

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This steal of a deal ends tomorrow, so the time to act is right now. 

GRAB BAG

Key Performance Indicators

Stat: The only thing worse than LA road traffic is LA marine traffic. 44 container ships were waiting for a berth at the twin ports of Los Angeles and Long Beach on Friday—the highest number since the pandemic began. Supply chains remain discombobulated as US retailers rush to bring in goods from Asia ahead of the holiday shopping season. 

Quote: “You’re going to see [marketing] to the scale of what we’ve seen in the past with Viagra and Humira.”

Be prepared to get slammed with Covid-19 vaccine commercials while watching football this season, UNC marketing professor Markus Saba told the Financial Times. Pfizer is hiring a new salesforce to push its vaccine, which accounted for about a quarter of the company’s total revenue in Q1.

Read: The economic case for bringing in as many refugees as possible. (Vox)

CALENDAR

The Week Ahead

Holmes trial: With all due respect to the ISM manufacturing report, the business story everyone will be talking about this week is the criminal fraud trial of Elizabeth Holmes, the founder of disgraced blood-testing startup Theranos. Jury selection begins tomorrow.

Jobs report: A strong August jobs report on Friday (>850,000 jobs added) could perhaps spur the Fed to begin tapering its bond purchases sooner than planned. Economists polled by Dow Jones think we’ll come in just under that, at 750,000.

Earnings: There are fewer stars reporting this week than competing at the US Open, but we should mention several nonetheless: Zoom, Chewy, DocuSign, and...yeah that’s it.

Everything else:

• September begins on Wednesday
• Bonnaroo is on Thursday
• Get pumped for the long Labor Day weekend

WHAT ELSE IS BREWING

• The Taliban are telling some farmers to stop cultivating opium poppies as the group tries to gain wider international acceptance, per the WSJ. 
• Tesla has filed to sell electricity on the retail market in Texas. 
• TikTok is banning the “milk crate challenge” due to safety concerns.
• Astra’s first rocket launch since it went public failed to reach orbit.
• ICYMI: Our interview with Yale professor and happiness expert Dr. Laurie Santos.

BREW'S BETS

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Dive back into the week:

• Shallow dive: Atlanta vs. Florence
• Medium dive: Random earth images
• Deep dive: The most translated book from every country
• Cannonball: No one can explain why planes stay in the air

GAMES

The Puzzle Section

Kriss Kross: How well do you know your app icons? Try our latest Kriss Kross to find out.

Nutritional Facts

Can you name the popular food product from the ingredient list? 

Unbleached Enriched Flour (Wheat Flour, Niacin, Reduced Iron, Thiamine Mononitrate {Vitamin B1}, Riboflavin {Vitamin B2}, Folic Acid), Canola Oil, Palm Oil, Sugar, Salt, Leavening (Calcium Phosphate, Baking Soda), High Fructose Corn Syrup, Soy Lecithin, Natural Flavor

ANSWER

Ritz crackers

✤ A Note From Masterworks

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