By Frank Gardner BBC security correspondent

Nine months into the war on terror, the threat from al-Qaeda is still real. The organisation is down but not out.

The trouble with the threat from al-Qaeda is that it's unseen and undefined.

Western intelligence believes that it could come from any one of several directions:

• Weapons of mass destruction: it could be used in a nuclear, chemical or biological attack on the West - Osama Bin Laden is known to have tried to get his hands on nuclear weapons.
• Cyber terrorism, meaning an attack on a country's infrastructure by hacking into its computer systems
• Conventional attack, such as blowing up a government building, hijacking planes or trying to assassinate a Western leader

So, if all these threats are still out there, then what progress has been made in America's War on Terror?

Military front

Nearly 10 months into the campaign, George Bush chose this Independence Day to give his audience an update.

"In Afghanistan we defeated the Taleban regime. That was just the first step," he said.

Al-Qaeda leaders... are reported to have told their followers: go back to where you came from, lie low, and strike when you can

"The liberation of that country begin of long and unrelenting struggle America's a patient and determined country. We're working with our allies every tool of law enforcement.. And we will take the battle to the enemy wherever he hides, wherever he dwells."

There is no question that the West's war in Afghanistan has been a military success.

Al-Qaeda has largely been driven from its caves, its members are on the run, and their training camps destroyed. But Western forces never found their key target.

Osama Bin Laden and most al-Qaeda leaders are still at large.

They are reported to have told their followers: go back to where you came from, lie low, and strike when you can.

Already this year, there have been deadly bombings in Pakistan and Tunisia.

They are being blamed on al-Qaeda sympathisers - proof that militant Islamists still have the motivation and the means to strike at the West.

Financial front

Cut off al-Qaeda's money and its attacks will dry up. At least, that was the thinking last year.

But it hasn't been as simple as that.

US Treasury officials told me they had identified five sources of al-Qaeda's funding.

First, there are rich donors from the Middle East.

Then there are certain Islamic charities, often where the donors do not even know who they are funding.

Then there are the legitimate businesses.

And also smuggling, especially of guns and drugs.

Finally, there is Osama Bin Laden's own wealth. Not huge, but still estimated at millions of dollars.