I am currently way down in New Orleans where the Mardi Gras celebration is underway. And for right now, today, there is no recession. Thousands are gathering here for this, the last day before the Lenten season. Mardi Gras means Fat Tuesday: you eat and enjoy and party till you drop.

There will be parades, with many hundreds in costumes. One convention organizer said: " We've delivered more beer in the last couple of weeks than ever before" and "the bigger bars here, they're getting 100, 200 cases at a time."

The losses from Gustav are significant, but not nearly as bad as they could have been.

That's the early read regarding onshore / offshore property and infrastructure damaged caused by Hurricane Gustav, with losses pegged at $4 billion to $10 billion, according to estimates by Risk Management Solutions. In contrast, Hurricane Katrina in 2005 caused about $50 billion in damages.

Risk Management said losses from Gustav were lessened by the fact that the storm weakened, and hit the coastline as a Category 2 hurricane, and the fact that it came ashore about 70 miles southwest of New Orleans. Those factors, combined with better preparation by companies with vulnerable property in the area, will result in lower damages totals, Risk Management said.

However, RMS was quick to point out that the $4-10 billion damage total does not include loses from flooding in New Orleans that could occur in the days ahead.

Gustav: Little U.S. GDP impact

Economist David H. Wang, who runs U.S. GDP models each quarter, said Tuesday he expects "only a minimal U.S. GDP impact from Gustav."

"Of course human safety is the primary concern. But regarding regional GDP, the Southeast U.S. will incur a 0.1-0.3% GDP reduction in the third quarter from the hurricane, but the overall impact on U.S. GDP will be minimal," Wang said.

Grocery store chain Winn Dixie Stores Inc. (NASDAQ: WINN) is emerging from bankruptcy with remodeled stores, better shopping conditions and product mix, improved customer service, and strict attention to cost management. Same store sales for 1Q 2008 are essentially flat, but the company posted a huge reduction in net loss, $800,000, down from $24.6 million net loss one year ago, a $23.8 million improvement. Net income for 1Q 2008 was $1.6 billion, up $11 million. Gross profits increased $22 million to $446.4 million, and the 30 remodeled stores have registered increased foot traffic. Winn Dixie plans to remodel a total of 75 stores in 2008.

Winn Dixie is also focusing on cost control as it emerges from Chapter 11. Administrative and promotional expenses have been slashed, as have costs at the company's distribution facilities. Winn Dixie still faces significant capital expenditures for store remodeling, at least $140 million. Legal costs to emerge from bankruptcy will run in the $5 million to $7 million range.

Even in the midst of a difficult and complex multi-year turnaround, Winn Dixie has acted to gain the goodwill of consumers and investors. Winn Dixie remodeled and reopened one of the first full-service grocery stores in lower east side New Orleans to help the city rebuild. The company is on the front lines in the fight against breast cancer, providing educational materials in its stores and sponsoring free mammograms for women without access to health care services.

The stock currently trades around $19. Given the success of the company's turnaround thus far, this is a stock for bargain hunters to investigate.

Nearly two years ago - August 29, 2005, to be precise - Hurricane Katrina made landfall in southeast Louisiana. The subsequent breach of the New Orleans levees left about 80% of the Crescent City flooded and caused tragic loss of life.

100 weeks later, New Orleans and the surrounding areas are slowly but surely rebuilding. The site of Zapp's potato chips in specialty grocery stores across the country is certainly a good sign for me personally. Tourism remains a critical element to the venerable city's recovery so please remember to spend money if you happen to be in the region ... and buy locally.

Time Inc. - the magazine publishing arm of Time Warner (NYSE: TWX) - is paying tribute to New Orleans this month, with 10 of its magazines featuring articles about New Orleans. A Time cover story argues that the same bureaucratic mistakes are being made to shield the city against future storms. Essence follows up with 3 New Orleans families interviewed in 2005. Fortune looks at the economic state of the city and the impact of two years' worth of relief funds. Even Entertainment Weekly features a look at the Big Easy, featuring personal photos from R.E.M. lead singer MIchael Stipe, whose band recently released the song "New Orleans Instrumental No. 1."

Miles of New Orleans remain pretty much the way Katrina left it two years ago -- with 123,000 owner-occupied homes and 80,000 rental units damaged or destroyed. And as one of the poorest regions of the U.S., it should come as no surprise that subprime mortgages have deeply penetrated its mortgage market.

How bad are subprime woes in New Orleans? According to Bloomberg News, about 21% of Louisiana's 60,000 subprime mortgages were at least 30 days past due in last year's fourth quarter, up from 15% in 2004, the year before Katrina. Only Mississippi and Michigan had higher subprime delinquency rates.

And the subprime woes are a great example of the widening income disparity in the U.S.. That's because subprime mortgage originators are transferring these bad mortgages at a deep discount to hedge funds -- whose wealthiest owner, James Simons, took home $1.7 billion last year. For example, H&R Block, Inc. (NYSE: HRB) agreed April 20 to sell its subprime mortgage lender, Option One, to Cerberus Capital Management LP, a New York private-equity and hedge-fund manager.

Visiting Blogging New Orleans earlier today (the Crescent City is home to much of my extended family ... specifically, 25 aunts/uncles/cousins), I came across a rant about Starbucks' (NASDAQ: SBUX) rumored plan to open a shop on storied Jackson Square, home to the St. Louis Cathedral and a famous equestrian statue of our seventh president.

Author Jennifer Jordan calls the mere thought of the corporate descent upon the French Quarter's centerpoint as "totally UNACCEPTABLE" and vows to "get signatures or signs or whatever it takes to keep Starbucks out of the French Quarter." She goes on to say that while SBUX is a fine organization in principle, there is a place for chains, and the 289-year-old French Quarter is not such a place.

Another issue, other than the dichotomy of seeing the ubiquitous green logo sprout up among the old-worldliness of the Vieux Carré, is the inevitable competition that will arise with Café du Monde, a French-Quarter based landmark for café au lait and beignets (French-style doughnuts). Always a stop for me on my frequent visits to my Southern family, Café du Monde is an absolute institution, founded in 1862 and open 24 hours a day.

It will be interesting to see how the plucky folk of New Orleans respond to the threatened encroachment from the Seattle superpower. Petitions are being attached to clipboards as I write this, I am sure, and locals are reportedly beseeching local restaurateurs to snap up the real estate SBUX may currently be eying.

Ms. Jordan closes her plea with the notion that SBUX must be stopped if "we're going to preserve what makes the French Quarter, and the rest of New Orleans, as individual as it is."

Beth Gaston Moon is an analyst at Schaeffer's Investment Research.

While residential real estate languishes, commercial real estate has been particularly strong. In fact, there have been a variety of major deals lately, such as Blackstone's $36 billion purchase of Equity Office Properties (NYSE:EOP).

But, as prices rise, investors are looking for value plays. So, why not New Orleans?

That's the thinking of Equastone. Actually, this real estate firm specializes in tough situations and calls its approach "value-add" commercial real estate.

Its latest deal is for the Pan-American Life building, which is based in downtown and is 28 stories. The price tag is rumored to be about $50 million. The building is at 75% capacity and did not suffer much damage from Katrina.

The deal is certainly a positive sign for New Orleans. Actually, this may alert other funds to the opportunities in the city.

Interestingly enough, Equastone is not finished. The fund is in the process of buying another property in New Orleans.

Tom Taulli is the author of various books, including the Complete M&A Handbook and operates DealProfiles.com.