Many of the people we work with were located in the World Trade Center, and we have friends at the Pentagon. Some we now know are lost. For the others, we can only hope for their safety. We, also, hope that the financial markets will remain closed until the scope of the situation is assessed. What we do know is that financial markets do not like uncertainty and risk.
Investors recoil from risk quickly and in many cases, blindly.
In the bond market, for example, investors will tend to avoid lower-credit bonds and buy U.S. Treasuries. Under such conditions, prices of corporate bonds, especially lower-quality bonds, would fall, and Treasuries would rise. On the plus side, our nation is intact. Communications lines remain open, and, despite the loss of countless lives, our infrastructure and leadership remain in place. Such actions help create a sense of calm and assurance to the nation's financial markets.