Houston

Five days after it first plowed into southwest Texas as a category 4 hurricane, Tropical Storm Harvey has made second landfall west of Cameron on the border between Texas and Louisiana, early Wednesday according to the National Hurricane Center. The storm, which has already pummeled the city of Houston with more than 50 inches of rain – a new record for the contiguous US, according to the Wall Street Journal – has left at least 18 dead, including two Houston police officers, and forced tens of thousands of people from their homes.

As Tropical Storm Harvey heads back inland, slamming southwest Texas with another 15-25 inches of rain, Housting officials are reporting that the city's critical infrastructure is starting to fail under the weight of the floodwaters, and may soon collapse.

According to Reuters, roads and bridges in Houston have started to buckle under the impact of the catastrophic flooding in parts of the city. According to Jeff Linder of the Harris County Flood Control District, one bridge had collapsed and some roads had been damaged by the torrential rains.

Hurricane Harvey's historic flooding in Texas is set to wreak havoc on the auto industry and its insurers with analysts now predicting the storm could damage more vehicles than Hurricane Katrina.  In August 2005, Katrina wiped out some 500,000-600,000 vehicles but William Armstrong of CL King warns that Houston has about 5x more people than New Orleans did at the time.

There are still two to three days before the peak flooding - and damage - in Houston arrives, yet already Wall Street is trying to calculate how much the worst natural disaster in decades befalling the 4th largest American city will impact US GDP. Or rather boost it, because in two notes out late in the day Monday, one from Goldman and one from JPM, the authors come to two polar opposite conclusions: Goldman claims that the Houston natural disaster will reduce Q3 GDP by as much as 0.2%, while JPMorgan predicts that the "net impact on Q3 and Q4 GDP should be positive."

Hurricane Harvey has unleashed unparalleled devastation on southwest Texas, flooding Houston, the fourth largest city in the US, and many towns along the Gulf coast from Galveston, to Port Lavaca and beyond. But even Harvey’s 130 mph winds aren’t strong enough to threaten the ironclad balance sheets of America’s largest insurers, which have amassed a “fatter-than-ever” capital cushion capable of absorbing any payouts related to what looks to be, by several measures, one of the worst hurricane in US history, according to the Wall Street Journal.