We've gone through 6 days since the roll-over. Yardeni's last report (approx. Dec. 20) stated how a slow degradation of Just In Time inventories would lead to a recession. How & why does he change his tune after 4 business days? He appeared on CNN's Moneyline after the NASDAQ took a s**t kicking on Tuesday saying he was wrong (no mention of a 30% cahnce of a recession - I guess that's not for the day-traders watching CNN - only serious NY Times readers). Methinks he doth protest too much!

-- Think It (Through@Pollies.Duh), January 07, 2000

Answers

It is a bit odd.

-- Mara (MaraWayne@aol.com), January 07, 2000.

It's really very simple. Assume that, say 5% of Y2K problems manifest themselves during the rollover.

Assume that--and we're being _very_ cautious here--only another 5% of Y2K problems were found BEFORE the rollover. And I remind you that all those accounting packages, management packages, etc., have been rolling into FY 2000 since April. The US Governemnt, who owns more old, fragile code than anyone else, has been in the year 2000 since October. (I know. I remediated one of their systems.)

So, only a small fraction--10%--of Y2K problems have been seen by 01/01/00. Fine.

Multiply every problem to date by ten.

Hell, don't even spread that out over the course of the year. Multiply all the problems seen to date by ten, and assume they all hit us in January.

That won't disrupt supply chains. That won't bring down power, or telcom, or banking.

It won't do much besides drive up sales of Advil to corporate IT staff.

That's why Yardeni could say what he said.

It is over, folks. I don't mean that there will never, ever be another Y2K bug. I don't mean that there won't be some headaches. But bugs and headaches--I challenge any professional programmer to refute me--are just business as usual. There is no more threat to our way of life, our grocery store shelves, or our economy from Y2K.

(And I certainly don't poo-poo the idea of a recession in 2000. We're in a terribly overheated economy, with a stock market bubble ripe to pop. I'm just saying that Y2K isn't the needle that's going to pop it. Predicting a recession can be like predicting rain: if you just wait long enough, it will happen, sooner or later. But the grounds for a causal relationship with Y2K have all but evaporated.)

Craig

-- Craig Kenneth Bryant (ckbryant@mindspring.com), January 07, 2000.

Big banks and brokerages don't like their well know employees to have a negative outlook on the economy or market. Many well known bears have lost their jobs during recent months. I'm amazed that Yardeni stuck with his forecast as long as he did. As first, he said he would not change anything until hte end of the month, but he couldn't hold out. it's obvious that there was a lot of pressure on him to change his forecast.

-- Dave (dannco@hotmail.com), January 07, 2000.

Yep. Forget the analysis I just posted. Must be that the man has no integrity. Nothing else could explain him abandoning his old theory in the face of new evidence.

-- Craig Kenneth Bryant (ckbryant@mindspring.com), January 07, 2000.

Woner if that guy will ever work again?

-- (I'm@po.ly), January 07, 2000.