Why should it be a suprise, that "public panic" is a very good
potential, when all the public has heard, from those who have the
capability to profit from one's ignorance, by agitating the public into
buying their services, and others who also have their own agendas,
is that DISASTER lies ahead. Recommendations to have enough
money to last a couiple of weeks, stocking up on food to last a
month, stocking up on gas for autos ... no wonder the "public
panic" is highly probable!
Wednesday March 10 5:24 PM ET
Public Panic Seen A Top Y2K Risk -U.S. Experts
NEW YORK (Reuters) - Two of Washington's top trouble-shooters
for the year 2000 computer bug said Wednesday they are now
more concerned about the risk of a public panic than a collapse of
the national infrastructure.
John Koskinen, chair of the President Clinton's Council on Year
2000 Conversion, and Federal Reserve Board Governor Edward
Kelley said they were confident the country's power, transportation,
communications and health care systems were not in danger.
Both experts said one of their top priorities is averting a ''public
overreaction'' that could prompt a massive run on banks, gas
stations and mutual funds ahead of the turn of the century.
``Actions that individually look logical like filling up your gas tank
on December 31, taking $1000 out of the bank, buying twice as
many prescription drugs as you usually do, taking 20-30 percent of
your IRA money out of the market -- a couple hundred million
Americans all do that at one time you've got yourself a major
problem,'' Koskinen said.
The chief ``real risks'', in their assessment, are that foreign
countries, local U.S. authorities and small businesses here are ill
prepared for computer failures, they told a panel discussion on the
press and Y2K sponsored by the Media Studies Center in New
York.
``Our risk for the country is less likely to be a national
infrastructure failure and it's more likely to be a failure either of will
or information or reporting,'' Koskinen said.
The so-called Y2K problem arises because many older computers
were programmed to recognize only the final two digits of a year.
That has fanned concern that computer-controlled power,
communications, transportation and financial systems, among
others, may fail or malfunction in 2000 if they do not recognize
``00'' as a new year.
Kelley said the Fed did not foresee any reason for a surge in
demand in cash around year-end but plans to have $50 billion of
cash ready to meet any consumer withdrawals spurred by fear of
bank computer failures.
``Probably the most important single element that is going to tell
the tale here in our being able to successfully navigate through this
Y2K millennium bug challenge is going to be how the public reacts
to it,'' the Fed policymaker said.
The public could become ``so overly worried about what might
happen that there could be created the very type of problem
we are working so hard to prevent,'' he cautioned.
Koskinen said he does not foresee a widespread collapse of the
country's power grids, financial system, telecommunications or
transportation systems.
``It's important to understand that planes aren't going to fall from
the sky. The elevators aren't going to the basement and the
pacemakers aren't going to stop,'' he said.
He said he was confident the government's computers would also
not pose major problems. But he was less sanguine about local
authorities and small businesses who have, in some cases,
devoted far fewer resources to testing and contingency plans.
``There is a huge problem in healthcare because there are a large
number of institutions and organizations which are free standing,
100-bed local community hospitals that are hard to get information
on,'' he said.
In Koskinen's view, the banking industry is the most well-prepared.
Kelley said he was confident banks will be prepared and there is
little likelihood the financial system will seize up or crash.
``We can handle any (liquidity) need that might emerge and still not
have it affect monetary policy,'' he said.
Liquidity concerns related to Y2K problems would not stop the Fed
from raising interest rates later this year, if needed to head off
inflation, Kelley said in an interview with Reuters Television ahead
of the panel discussion.
Though some foreign countries have been slow to address the
issue, the Fed does not expect this to seriously affect worldwide
financial activity which he said is dominated by a relatively small
number of institutions, many of which are based in the U.S. and
well prepared.
Sandy Perle
E-Mail: sandyfl@earthlink.net
Personal Website: http://www.geocities.com/capecanaveral/1205
"The object of opening the mind, as of opening
the mouth, is to close it again on something solid"
- G. K. Chesterton -
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