The economic impact of the attack on the World Trade Center and the PentagonThe effects of the attacks on the World Trade Center and the Pentagon are spreading around the world , thank you sector, by region and by market. Bond markets inside and outside the United States, already nervous about the deceleration of global economic activity, are struggling to find direction in the aftermath of the attack. There now seems little doubt that the US and global economies will slide into recession. The aerospace, insurance and banking sectors, directly linked to the attack, will suffer the most. The airline industry had already slowed due to lower economic growth and cuts in business travel. Then, the moment the first plane hit the first tower, the U.S. airline industry suffered an even bigger blow. Over the next ten days, nine US airlines were downgraded or placed on credit watch with negative implications. Airports and the aerospace sector have also felt the impact of credit. In New York, the Port Authority of New York and New Jersey, headquartered in the World Trade Center, was placed on credit watch with negative implications, and in the days that followed, every North American airport and its associated special facilities and 13 companies commercial aerospace: airplane manufacturers; engine manufacturers; suppliers of aircraft systems, components and materials; and suppliers providing support to aviation were placed under credit control with negative implications. The effect of the attack on the World Trade Center, due to the decrease in air travel, goes further to affect the hotel industry and tourism. Now, as the death toll rises and as property damage begins to be assessed, it seems quite likely that th......half of the paper......counting credit problems some banks may have. Investment banks could be particularly vulnerable to business disruption and the potential impact of a further slowdown in already weak capital markets. Any aggressive share buybacks will further reduce the tolerance threshold for earnings pressure. Outside the United States, the attacks are likely to increase pressure on banks, as investment volatility becomes a threat to banks' already precarious financial positions. Although the economic effects of the attack on the World Trade Center and the Pentagon have raised different opinions from financial analysts, none of them have the ability to fully understand how the tragedy of September 11 will develop. But in the coming weeks, as the shock wears off, they should be able to better assess how the ongoing dynamics of these events are shaping the immediate economic outlook..