There is a major quake lurking in Silicon Valley’s Future, and when it hits, the aftershocks will be felt far beyond California. Estimates of direct damage from a Magnitude 6.7 quake along the Hayward fault top $165 billion, but add in fire, infrastructure damage and related business disruption and the total could top $1.5 trillion.
A little-known bit of history suggests a frightening scenario. A century ago, the insurance claims from the April 18, 1906 San Francisco quake rattled the English economy, leading first to a recession and then the financial Panic of 1907. This time around, if a quake should hit, the the falling economic dominoes could have an even more catastrophic effect, toppling the US Dollar from its privileged position as the World’s reference currency in favor of the Euro.
For my complete essay on ABCNews.com, go to High-Tech Quake May Shake More Than Silicon Valley.