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  3. Economy Terrorized From Wall Street to Main Street, Layoffs, Losses, and Little Hope The popular word in business befo

Economy Terrorized From Wall Street to Main Street, Layoffs, Losses, and Little Hope The popular word in business befo

admin2010-03-26  39
问题                           Economy Terrorized
    From Wall Street to Main Street, Layoffs, Losses, and Little Hope
    The popular word in business before September 11 was "visibility." Company after company complained about their gloomy future because of the worsening economy. Now, though, corporate America has a clear vision of the immediate future--and it’s not a good one. "The attack has turned the business world upside down," says Diane Swonk, chief economist at Bank One in Chicago.
    Companies have been aware of the possible loss due to the terror attacks. Firms directly affected by the horror, such as Boeing and Marriott, warned of lower profits. Airline layoffs alone will top 100,000, pushing some analysts to say as many as one million workers may lose their jobs because of the post-attack repercussions (反应). On Capitol Hill, lawmakers and the Bush administration began preparing an economic emergency response. "The foundations of our free society remain sound, and I am confident that we will recover and prosper as we have in the past," Federal Reserve Chairman Alan Greenspan told Congress.
    A chief executive of Frontier Airlines in Denver last week announced a 20 percent flight reduction and large scale layoffs.
    On Wall Street, markets tumbled (TM) amid the likelihood of recession and war: The Dow Jones industrial average fell nearly 700 points Monday. "It’s no longer about earnings or the economy or interest rates anymore," says Morgan Stanley market strategist Peter Canelo. "It’s about fear."
    Some observers believe Washington’s response could be effective to prevent further economy deterioration. "The recovery could be much smoother than expected due to the fiscal and monetary stimulus we’re in store for," says Richard Weiss, chief investment officer for City National Bank.
    Restoring consumer confidence is a top priority for Greenspan and Congress, given that consumer spending accounts for about two thirds of the nation’s total output. To that end, the Fed has been flooding the markets with cash. Congress, meanwhile, is awash in plans to spend money, drawing down the $153 billion Social Security surplus. There’s even talk of further tax cuts.
    The economic devastation of the worst disaster on American soil is far and wide. Last week, individual industries began to estimate the loss.
    Airlines
    While "recessions are bad for the airline industry, terrorism is worse," says a senior vice president at aviation consultants Avitas. Now both are serious problems for airliners, as heavily indebted and cash-poor companies are seeing a drastic reduction in bookings. Some planes are flying less than half full. Experts predict that this will put some airliners out of business and the total industry losses will amount to ＄10 billion by the end of next year.
    When--and if--the industry recovers, it will have been fundamentally changed. Passengers might find fewer flights overall and limited service to smaller airports, as airlines focus on large, profitable hubs (交通枢纽).
    Oil
    As U.S. naval forces headed out from Norfolk (美国一个重要的海军基地) toward the Middle East, the oil market was nervous but focused as much on recession as on the threat of war. Crude prices slid downward due to the predicted economic slowdown and a drop in air travel which would reduce demand. Still, with the prospect of armed conflict very real, analysts see considerable risk of higher energy prices, especially when the war might involve Iraq, an oil-producing country.
    But Michael Lynch of the research firm DRI-WEFA said that despite decreasing demand, the terror attack had produced an "uncertainty effect" that would possibly drive oil prices higher in the weeks ahead. Lynch said that oil companies and large industrial users of oil very likely would attempt to build their inventories amid uncertainty.
    Retailing
    Many shoppers stayed home during the week of the attack. Federated Department Stores, which owns Bloomingdale’s and Macy’s, said sales during the week were ＄65 million, or about 20 percent, below its forecasts. Other retailers, including Wal-Mart Stores and bookstore chains Borders Group and Barnes ＆ Noble, as well as teen apparel retailer American Eagle Outfitters, reported a fast decrease in sales but some rebound by last weekend. "For the most part, sales are starting to come back, but they’re not where we want them to be," says Tracy Mullin, president of the National Retail Federation.
    Consumers already planning the purchase of a new car, appliance, or other big-ticket item may go ahead, but forget those who had only begun to think about buying, says Marian Friestad, president of the Society for Consumer Psychology. "This would be a time when people would not be particularly open to changing their purchase behavior or trying new things," she says. Frivolous purchases, like perfume and fashion, will probably decline.
    Media
    On Madison Avenue, advertising industry executives estimated their losses after nearly a week without network TV ads. But that is not all. Many companies felt it inappropriate to advertise during such a time of tragedy and canceled their commercials on TV.
This trend is likely to mean further losses for an industry already suffering from a sharp cutback in spending.
    Already, the six TV networks report an estimated $320 million in lost ad revenues due to the attack. And four of the country’s newspaper groups warned of a shortfall in third-quarter earnings because of canceled ads.
   Entertainment
    The most pressing question right now is what will happen in TV, already suffering from a big drop in advertising. Although the new season has been pretty well purged of any references that might be deemed offensive in the wake of the attack, there is serious doubt about viewers’ tastes in the future.
    Two big-budget films--Big Trouble and Collateral Damage--were shelved indefinitely last week. Other movies with New York themes were pushed back. Still more were simply scrubbed clean of their references to terrorism and the World Trade Center.
However, the entertainment industry may not suffer long-term damage, with losses expected to level off by the first quarter of next year, according to analysts.
    Insurance
    Already stunned by a plunge in profits and losses from storms in the first half of the year, property and casualty insurers now face even worse. "All profits will be wiped out," says an analyst. Despite some loss, analysts are confident that the industry will be able to meet the estimated ＄30 billion in projected claims, a loss that could escalate if costly business-interruption and personal injury claims accelerate.
    One thing is certain: There will be higher rates and more limited coverage for terrorist or war-related events, especially for airlines.
One certain effect of the attack on the insurance industry is the increased rates and ______ for terrorist or war-related events, especially for airlines.
选项
答案more limited coverage
解析 这个题目涉及恐怖袭击对保险行业的影响。根据题目中the insurance industry和certain effect可将相关信息定位于Insurance部分的最后一句话，“One thing is certain： ...”。答案就在其中。
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