No Need For Y2K Panic On Wall Street, Officials Say

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Tuesday September 7 1:28 PM ET

No Need For Y2K Panic On Wall Street, Officials Say

By Peter Ramjug

WASHINGTON (Reuters) - The White House, Securities and Exchange Commission and major Wall Street players, moving to calm investors' fears from Y2K doomsayers, said Tuesday that the first trading day of 2000 will be business as usual.

``I'm very, very pleased that we're able, as an industry, to report to 70 million Americans who are owners of equities securities that the first trading day of (2000) will be business as usual,'' New York Stock Exchange Chairman Richard Grasso said at a news conference at SEC headquarters.

Grasso, seated next to Frank Zarb, chairman of the National Association of Securities Dealers, which is parent of the Nasdaq stock market, said ``the two principal markets have conducted all of the necessary tests'' so that ``investors will consider the first trading day (of 2000) to be just another trading day.''

Concerned that some investors are worried over doom and gloom predictions of computer crashes resulting from the date changeover, Grasso told investors ``Please, do not, do not, subscribe to the theories some have espoused.

``We are going to be an industry that will conduct its business in a routine fashion'' on Jan. 3, the first trading day of the new year, the chairman of the Big Board said.

Marc Lackritz, head of the Securities Industry Association, the massive Wall Street lobbying group, said at the news conference: ``We've checked and re-checked all of our computers, and we've tested and re-tested all of our systems, and we think we're very well prepared for the conversion on Jan. 1, 2000.''

Just to make sure, there will be one more industry-wide test on Jan. 1, said Zarb, explaining that it ``will give us an opportunity to reaffirm that all we think is well continues to be well.''

There are still bound to be ``some mistakes,'' SEC Chairman Levitt told reporters, but ``I am assured that those mistakes are minimal.''

PUBLIC MISCONCEPTION THE WORST FEAR

Levitt, who is Wall Street's regulatory overseer, said his worst fear is public misperception about what would happen if some computers misread the new year as 1900 instead of 2000, possibly causing major disruptions around the world.

``There are those that thrive on that kind of anxiety (who) would do a great harm in terms of public understanding of the issues,'' said Levitt, adding that his own agency is Y2K-ready.

To set the record straight, the SEC, NASD, SIA and the mutual fund industry's Investment Company Institute have banded together to create an investor kit that offers advice, such as the importance of keeping good records of bank and investment account statements.

The kit, available online, also tells investors not to drastically change their investing habits and not to worry about obtaining stock certificates.

It can be accessed through the SEC's Web site, www.sec.gov; the NASD site, www.nasd.com; the SIA site, www.sia.com; or the ICI site, www.ici.org.

The White House's Y2K chief, John Koskinen, said: ``If people have hard, real information, they'll be able to respond appropriately to the challenges as we move to the end of this year.''

======================================== End

Snip:

"Just to make sure, there will be one more industry-wide test on Jan. 1, said Zarb, explaining that it ``will give us an opportunity to reaffirm that all we think is well continues to be well.''

Don't worry, be happy!!

Ray

-- Ray (ray@totacc.com), September 07, 1999

Answers

Koskinen said, "If people have hard, real information, they'll be able to respond appropriately to the challenges as we move to the end of the year."

I don't know whether this is the height of hypocrisy or a cleverly worded statement that can absolve him and the administration of any and all responsibility.

-- Vic (Rdrunner@internetwork.net), September 07, 1999.


PUBLIC MISCONCEPTION THE WORST FEAR

Uh, yeah.. That's why I got out of the market a month ago. I went from being 100 percent in, to about 30% in.

Even though I think Y2K will be a 2 or a 3, (based on my own companies inside testing..), I've watched the lemmings jump one too many times.

Even if the market stays up without a hitch (big if).. This says nothing about the impact of Y2K on corporate profits (the thing that is SUPPOSED to drive stock prices). If corporate profits are more than marginally changed due to Y2K, PE ratios of 100+ cannot be sustained (IMO). Also, numbers aside, if the market sentiment changes for any reason, we could see big corrections.

I'm going to sit this one out.

Bryce

-- Bryce (bryce@seanet.com), September 07, 1999.


Did they mention that you can all sell your Ebay for $0.25 per share and buy a share of GE at $10?

-- Dave (aaa@aaa.com), September 07, 1999.

Bryce commented:

"Also, numbers aside, if the market sentiment changes for any reason, we could see big corrections. "

You might want to make a substitution here Bryce.

Correction = Bear Market

Ray

-- Ray (ray@totacc.com), September 07, 1999.


"...the first day of trading will be business as usual."

What a wonder it must be to have such a well polished crystal ball.

Is it Mad Max today...no, light reading...

It is a pleasure to stand upon the shore, and to see ships tost upon the sea: a pleasure to stand in the window of a castle, and to see a battle and the adventures thereof below: but no pleasure is comparable to standing upon the vantage ground of truth. . . and to see the errors, and wanderings, and mists, and tempests, in the vale below.

Francis Bacon

-- no talking please (breadlines@soupkitchen.gov), September 07, 1999.



http://www.dowguru.com/99crsh.htm

The above mentioned site is interesting as it portends to see into the future and market time better than any site I have seen.

Let the buyer Beware!

-- helium (heliumavid@yahoo.com), September 07, 1999.


The White House's Y2K chief, John Koskinen, said: ``If people have hard, real information, they'll be able to respond appropriately to the challenges as we move to the end of this year.''

Dear Mr. Koskinen, We are still waiting.

-- no talking please (breadlines@soupkitchen.gov), September 07, 1999.


"Concerned that some investors are worried over doom and gloom predictions of computer crashes resulting from the date changeover, Grasso told investors ``Please, do not, do not, subscribe to the theories some have espoused."

My, yes. Let us not look at any of the risks.

It will be OK. Pretty please, just believe us and we will make it "All Better".

Am I correct in remembering that the tests ran consisted of only a few tens of thousands of transactions? Compare that to a daily trading volume of upwards of a billion transactions daily.......

Frankly, "I" don't see why *anyone* would worry.

-- Jon Williamson (jwilliamson003@sprintmail.com), September 07, 1999.


If the structure holds, I wonder how cheaply I could get back in with Intel--$5 a share? $1.50?

-- Mara Wayne (MaraWayne@aol.com), September 07, 1999.

The crash is coming closer. Within a month and a half now. Erk. Love the sick feeling.

-- Typhonblue (typhonblue@hotmail.com), September 07, 1999.


I saw this on CSPAN. What a joke.

I wonder if these folks read the Navy report about the New York City water and sewer system.

If the toilets don't flush, these guys will have to "hold it in" if they are on the trading floor in January. ;-)

-- cgbg jr (cgbgjr@webtv.net), September 07, 1999.


Gotta love it. This article is careful to say:

``the two principal markets have conducted all of the necessary tests''

AND

``We've checked and re-checked all of our computers, and we've tested and re-tested all of our systems"

Now, to any ordinary person, this is extremely good news indeed. What more could one possible ask than complete testing and re-testing. The applause is deafening ...uh...applause?

Not in the TB2000 forum, no siree. Good news? Where? Huh? You see any good news? I can't see a thing. Hey, let's talk about the toilets!

-- Flint (flintc@mindspring.com), September 07, 1999.


helium:

Thanks for the dowguru.com link. I always appreciate learning about new web sites.

This is the only year I've ever followed the stock market closely.

I was predicting a plunge this month, and the charts indicates it might happen.

My prediction for one last bull run doesn't seem to get very high.

Hope I'm wrong about my predictions and premonitions.

Maybe I'll show the charts to my coworkers tomorrow and freak them out.

Cheap entertainment.

-- Randolph (dinosaur@williams-net.com), September 07, 1999.


Flint commented:

"Not in the TB2000 forum, no siree. Good news? Where? Huh? You see any good news? I can't see a thing. Hey, let's talk about the toilets! "

Well Flint, Why do you keep coming back??

How come you accept this SELF reported info whitout your 500,000 analysis while you RIP apart other negative news??

Your Pal, Ray

-- Ray (ray@tottacc.com), September 07, 1999.


Ray:

Good question, with several good answers. First, why should I tear it apart? We have a whole forum full of people to do that. Just READ these posts, full of outright dismissal. They call it a joke. They say it's not hard information (though it's as hard as anything we have, which admittedly isn't very). They change the subject. If you're satisfied with that response, there's nothing I can add.

Second, as you yourself point out, the only thing you can honestly say against it is that it's self reported. It's entirely possible that these tests never happened or were all bogus somehow, and everyone involved is in on it, we read their story and they're all sticking with it, right? They're ALL lying, whereas WE, who have absolutely no information to the contrary, are wise enough to disbelieve it on general principles because it makes us happy, right?

I'm inclined to believe that their code coverage wasn't quite as complete as they imply, but I'll believe that some pretty damn extensive testing has gone on. It's in everyone's interest to do this testing, why would they skip it and just lie and say they did it? To save money in the VERY short term, or what?

-- Flint (flintc@mindspring.com), September 07, 1999.



It's in everyone's interest to do this testing, why would they skip it and just lie and say they did it?

FAA, SSA, DOD. All have lied. Independant verification on all systems, interconnections, suppliers etc. would alleviate the worry.

What is the big deal? Prove it.

-- Mike Lang (webflier@erols.com), September 07, 1999.


Mike:

There's nothing I'd like better than competent, qualified verification of everyone's work. But who is qualified and competent? And how should the verification be done?

In reality, nobody understands the systems better than those working on them. In reality, anyone combing through the code would only get in the way in slow things down. In reality, there is no "validation industry" and never has been, except in isolated and limited ways like FDIC examinations, nuclear safety inspections, etc. In reality, the only practically feasible validation method (running code through automated bug-search software) was used by SAIC on the FAA code, and nobody here felt it was worth a damn anyway.

I won't go so far as to claim you are asking for what you know is unobtainable, so that you can turn around and pompously proclaim yourself unsatisfied with anything less. You know better than this, I suspect. But that just begs the real question: What *feasible* level of assurance would you find sufficient, short of waiting till next year and watching what happens?

-- Flint (flintc@mindspring.com), September 07, 1999.


Yeah right,

Here's what Grasso is saying now:

Concerned that some investors are worried over doom and gloom predictions of computer crashes resulting from the date changeover, Grasso told investors ``Please, do not, do not, subscribe to the theories some have espoused.

And here is what he said last year:

"We view the dimensions of the year 2000 issue as enormous, with potentially disastrous global consequences to both business and government."

I had clipped this quote from an article last year but am not having any luck at locating the full article. In my search, however, I did find a good website on which someone else mentions the very same quote (paragraph 6):

http://www.wild2k.com/database/vanityfair.html

This guy is just another waffling bureaucrat now apparently more concerned about his own investments than anyone else. If anyone knows when the stock market is going to crash it's this guy because he is sitting right on top of it. He is one of the few who will be able to milk it to the max, skim off the cream, and leave the majority of investors with sour milk.

-- @ (@@@.@), September 07, 1999.


Flint,

I saw part of the show and when asked about interdependence and the fact that testing between different systems is not taking place, the panel about sh*t themselves looking for someone to answer the question. If I remember correctly, these are just TESTS in a test environment and besides the panel sidestepped the question beautifully.

-- y2k dave (xsdaa111@hotmail.com), September 08, 1999.


helium:

Today at work some DGIs laughed at the dowguru.com graphs while some didn't want to see them at all.

Yes, Pollyannopolis has a large ostrich population.

-- Randolph (dinosaur@williams-net.com), September 08, 1999.


y2k Dave:

I already said the tests were probably limited, because they'd have to be. But otherwise, I'm just quoting what was actually written. You write like someone holding up a cross and brandishing a wooden stake when faced with such information. Like you're saying, these guys looked panicked, honest. And they sidestepped the question, honest. Trust me. And the tests must have been unrealistic somehow, honest. Please don't bite me, Mr. remediation vampire!

All in all, I'd say these are good signs here. Not great signs, not unimpeachable proof of excellence. But nothing to be frightened of either. It appears the markets will work.

-- Flint (flintc@mindspring.com), September 08, 1999.


Keep your eye on this one:

Dollar Plunges Against Yen

Ray

-- Ray (ray@totacc.com), September 08, 1999.


All of this reminds me of recent comments by the banking industry about ATMs. Just because ATMs will most likely be compliant does not necesarily mean that there will be enough cash available to fill ATM's. Just because the stock exchanges will most likely be compliant does not necessarily mean that stock prices will remain high in December or January when investors begin to understand the worldwide status of Y2K repairs.

-- Linkmeister (link@librarian.edu), September 08, 1999.

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