SEATTLE/ Conservative Monitor -- Analyzing the economic data seems irrelevant in light of the events of Tuesday September 11. The impact of the terrorist attacks on the New York World Trade Center and the Pentagon limits the usefulness of last week's economic data in analyzing where the economy may be heading. The disruption of economic activity and the response of markets around the world would suggest that the US economy and stock markets are in for a rough time.

Oil prices jumped on concern of the potential of an attack on oil facilities around the world. With the supply of oil concentrated in the Middle East and the US's dependence on imported oil any disruption in supply could wreck havoc on the developed economies around the world. If the terrorist wanted to cause large-scale economic hardship on the US economy they could have done it with less loss of civilian lives by attacking the oil facilities in Saudi Arabia. It would have been easier to place a bomb or instigate a rocket attack at the Saudi facilities in Ras Tanura or in Yanbu to disrupt world oil supplies.

The sophisticated planning and coordination of the attacks suggest foreign government involvement. Terrorists have only been successful in the past with governments that offered logistic and financial assistance and a safe haven for training and escape. The US response to these events will also impact the economy in the future.

While the attacks were a horrible event its important to keep put the event in prospective as regards the economy. The US economy has weathered natural calamities that were as disruptive and has rebounded quickly. A disruption of this magnitude will impact the economy negatively as well as well as many companies. The measure of the impact will not be known for months as we try to separate the impact of this event from the usual economic problems the economy was facing. In any case, the rebound will be less quick largely because the economy was already in trouble.

Certainly such an event will impact the way we live and as a result certain industries. The insurance industry will be faced with huge losses and air travel will suffer, at least in the near-term. Other industries may benefit from this disaster. Funding for the security and defense industries will likely increase and the telecommunications industry may benefit.

The technology has existed for some time to telecommunicate. As air travel becomes more risky or at a minimum more inconvenient companies will increasingly adopt this option over face-to-face meetings. It may also spur a decentralization of company activities. For many companies and industries there is little need to be located in large metropolitan areas. Insurance for example could locate their offices in smaller communities where there are adequate skilled employees for their needs.

Major stock market moves usually occur after major catastrophic events. Closing the stock markets is an effort to bring calm and allow investors time to consider the impact of Tuesday attacks on their personal stock holdings. How the public reacts to the events of Tuesday will impact how the economy performs over both the near-term and in the future.