Crash! Boom! Merchants Do A Brisk Trade In Crisis

Eric Ellis, San Francisco

08/14/1998 

The Earth moved for San Francisco yesterday, and it was not just because the First Philanderer, Bill Clinton, was in town.

A quake registering 5.4 on the Richter scale shook the city and neighbouring Silicon Valley from its collective bed just after 7 am, raising fears and memories of the last big tremor to rock the region, the Loma Prieta quake of 1989.

That quake, measuring 7.1, killed 67 people, caused around $US7 billion ($11 billion) in damage and was the deadliest to hit California's San Andreas Fault earthquake belt since the Big One of 1906. A quake that caused $US13 billion of damage hit Los Angeles five years later.

The damage yesterday was limited, and as of late last night, three small cracks had appeared in the 101 freeway that links San Francisco to Silicon Valley and south to Los Angeles - it collapsed in 1989 - while the biggest loss of property seemed to be $US4,000 worth of wine bottles which crashed to the floor of a market near San Juan Batista, about 130 kilometres south of San Francisco and close to the quake's epicentre.

But the quake did focus attention on California's buoyant earthquake industry. Days like yesterday are great for business.

"We've had a lot of calls today, I have to admit," said Mr Bryan Hillyard, manager of Earthquake Outlet, a San Francisco consultancy that advises on earthquake preparedness.

For fees that start at $US30 and head quickly upwards, Mr Hillyard and his team offer training classes, survival, medical and trauma kits, and site evaluations, to prepare California for the inevitable day when the Big One strikes again.

"It's not proper to say earthquakes are good for business, but what events like today do is raise awareness about earthquakes, and we can benefit from that," Mr Hillyard added. Sounding more like a notorious 900 number than a trauma specialist, Mr Hillyard told The Australian Financial Review that "we are here to fill your needs and desires".

Earthquakes have seeped into the Californian consciousness, and a large, mature industry has grown up around them. Tremors are common, occurring almost weekly in San Francisco and LA and causing no disruption to the two cities or their economies.

Bigger ones like yesterday's create a talking point in bars and shops, but the fabled Big One is another matter. At various times it has been predicted to cause massive death and destruction in two of the most populated US cities, and severe disruption to the national economy, much of which centres on booming California.

Serious doomsayers say it would 20 per cent being carved off the Dow Jones industrial average - though the Asian financial crisis seems to be doing that without any help.

The insurance industry holds that another 1906-type quake would wipe out the $US300 billion of capital held by US insurance companies, which are only now recovering after some lean, hurricane-plagued years.

California's telephone carrier, Pacific Bell, carries "what-to-do" instructions in its directories, offering information from the California Earthquake Authority, a State-run insurance agency that offers basic cover.

Policies start at about $US3,000 a year in high-risk, populated coastal regions. The high premiums are the main reason why just 25 per cent of Californians have earthquake cover.

Inside the Pacific Bell directories "earthquake" has its own reference, and the San Francisco book alone has more than a page of listings, including such firms as BeReady Disaster Preparedness Inc, Quake Kare Inc, Earth Shakes, Survivor Industries Inc, Seismic Solutions and the Golden Years Medical Supply Group.

The AFR called a few yesterday, and most lines were engaged for much of the day. They may have busier days than yesterday, and soon.

California's Office of Emergency Services said that based on typical statistics, "there is a small chance [approximately 5 to 10 per cent] of an earthquake equal to or larger than this main shock in the next seven days".