The weekend bombings on Bali have reawakened the sense of threat which had been receding since the September 11 attacks last year. In a stroke, people have been brutally reminded that there are groups in the world which are targeting them for destruction. And while a tragedy on the scale of Bali's mixes uneasily with the flow of the markets, the weekend's events were also a reminder about the risk of being long in an uncertain geopolitical climate. The Jakarta Composite Index plunged 10.35 per cent on Monday as jittery investors pulled their money out of the archipelago fearing the attack marked the start of a wider campaign. The panic extended to the currency markets where the hasty evacuation of cash drove the rupiah to 9,300 per US dollar from 9,000. Al-Qaeda has long made it clear that its plan for taking on the United States involves destabilising its economy. 'The youth should try to find the joints of the American economy and hit the enemy in these joints, with God's permission,' Osama bin Laden was quoted as saying in a video. This also applies to Indonesia. Bali is the crown jewel in the country's tourism industry. As a magnet for the world's holiday-makers, it is difficult not to surmise the bombings were intended to cause panic, a sudden withdrawal of foreign money and a terminal destabilisation of the economy. With the economy in ruins, Indonesia would fall like a ripe plum into militant hands. If that was the intention, it clearly has not worked. Perhaps the terrorists have missed something, but the past few years for Indonesia have hardly been a holiday. A collapsed economy? Imploding political system? Riots in the street? Indonesians, and investors in the country, have pretty much seen it all since the financial crisis of the late 1990s. Which is why analysts have not been calling for investors to pull out of Indonesia. If anything, the attacks have raised hopes the country might address its problems and hence become more investible. 'While previously the government seemed to have little political will to act . . . this time the government could capitalise on public support for a firmer stance,' ABN Amro's head of Indonesia research Stephan Hasjim said. Mr Hasjim noted that the Jakarta Composite Index closed at 337.475 points on Monday - a third higher than on September 21, 1998, when the events triggered by the financial crisis were reaching end-game. Suharto's 32-year rule was over, social unrest was rife, interest rates were up at about 70 per cent, the rupiah was trading at between 15,000 and 11,000 to the dollar and many were wondering if the nation could survive as a distinct political entity. Monday's close of the stock index was also only slightly higher than the 342.6 low hit at the end of April last year, when President Abdurrahman Wahid was engaged in a failed bid to remain in power against a backdrop of violent clashes between government and anti-government supporters. 'This period would make a worse but still comparable period with the present time,' Mr Hasjim said. ING Investment Management came out with a note on Tuesday, telling clients that following the hefty sell-off the day earlier, the Indonesian market was yielding 4.5 per cent and trading at only six times this year's earnings. 'We retain our overweight position in Indonesia as we believe the government will be able to handle this crisis diligently avoiding a further erosion of investor confidence,' it said. There will be more attacks on Western targets in Asia somewhere down the line, but for now it would appear the group which was responsible for Saturday night's massacre has failed. Perversely, if the attacks provoke a crackdown, the Bali bombers may end up doing the country an economic favour.