PKE and WTC disaster

["Forstater, Mathew" <ForstaterM@xxxxxxxx>]

Paul - You have argued here before, I believe, that PK analysis
concludes that natural disasters can end up stimulating the economy by
giving rise to various types of emergency expenditures that then will
have multiplier effects.  I believe you made such an argument with
regard to California a few years back.  Certainly, the argument has also
been made in terms of military destruction.  I wonder if you think that
we may expect a similar effect as a result of the WTC disaster, and if
you think that these effects may more than compensate for any
destabilizing effects.

I also wonder whether there might be other relatively stabilizing
effects as well.  For example, is it possible that such a disaster gives
rise to sentiments (sense of duty, responsibility) that may curb some
excessive moves on the part of some market participants?  For example,
is it possible that a 'big player' might resist a big sell-off in the
context of this kind of disaster, where they might not under 'normal'
circumstances of markets turning sour?  Also, would certain kinds of
'coordination' be acceptable under these circumstances, where they might
not usually?  Or would certain appeals, e.g. for calm, have a greater
chance of being heeded?

Also, will the disaster be blamed for things turning economically sour,
even if it may have been the case that things were heading that way
anyway?

Thanks,

Mat