Grey Davis can't win if the problem is or is not Y2k related : LUSENET : Grassroots Information Coordination Center (GICC) : One Thread

Grey Davis can't win. If he knows the power crisis in California is caused by Y2k breakdowns, he can't admit it and if he doesn't know, he is either being misled by his staff or is too dense to understand the implications of the Y2k problems. If he doesn't know the true causes of the problems, he can't do a good job fixing them. He wants to be elected to higher office and he looks like an idiot as the problems spiral out of control and he flounders from one ill conceived fix to another. If the power companies did not upgrade their equipment to solve the Y2k issues, and the generating capacity of the entire system has been reduced 20 or 30 per cent because of the failure to fix these systems, the capacity is not there to solve the problem and the governor gets bad press no matter what he does. He should be able to figure this out. A good politician is an expert at shifting the blame or at least generating enough confusion so the voters do not know who to blame. He has not even done a good job on this effort as the people blame him. Governor, if you are reading this think about it. Y2K was real and the problems are not yet fixed.

The amazing part is that the Legal profession appears to be suffering from a high level of gross incompetence. I have heard about very few cases where a company was required to pay damages for y2k losses considering that there are probably 10s of millions of cases where y2k issues have caused major losses and bankruptcies. Were they all an act of God beyond the control of people and companies? Look at the stock of IBM. As a company with a primary impact in the Y2k arena its stock is up almost 50 % in the last few months. Microsoft, the other major player took a big hit last year. Was this really Y2k related or due to other reasons? There is an interesting thread today on the Timebomb 2000 site by Paula Gordon where she demonstrates convincingly that the embedded systems problems are a major contributor to the problems in California yet you hear nothing about it in the press. There is also a discussion in that thread that the old mainframe computers that IBM said could not not be made compliant (7020 series?) for air traffic control purposes were finally put out of service at the rollover and those had 9 times the capacity of the replacement equipment where the controllers now have to keep contacting the planes to show the present position on yellow stickem tabs instead of automatically being shown on the screen under the old water cooled (vacumn tube?) system. This is incredible. There is not a sudden increase in the number of flights. The problem is the lack of ATC control capacity. Flights are delayed and cancelled and the true cause is hidden.

It turns out that Cory H, Ed Yourdan, Gary North, Bruce Beach and the other people ringing the alarm bells were correct and the pollys who said the problems were overblown were dead wrong. We are all fortunate that they were able to fix most of it so there were no catastropic failures such as week long power blackouts. The problems were more in the nature of system breakdowns of billing and accounting systems that bankrupted some companies that are still surfacing and are very difficult to fix. There is a mass gag order not to talk about it and this gag effort is very successful as noted in the scarcity of lawsuits on these issues.

We live in interesting times. Sometimes the powers that be do tell the truth but usually there is more hidden than reported. So sad.

-- Tom Smith (tom@quack.gom), May 01, 2001


The thread that "Tom" mentions is at TY2K (now under new "management) at topicID=245.topic

Here a cross-post I just added to that thread from Cory H's list:

Cory H.'s list 5/1/2001: Y2K, JAE & Yr End Audits ----------------------------------------------------------------------

The following is from Cory H's List:

From Sent: Tuesday, May 01, 2001 2:46 PM Subject: [dc-y2k-WRP] Digest Number 1133

Message: 4 Date: Mon, 30 Apr 2001 23:58:28 EST From: Cory Hamasaki

Subject: Y2K, you decide.

Some of you may recall that I expected that large companies would lose sight of their bottom line, have problems with back-room batch systems, inventory, and such. I also expected that the problems would take 6 to 9 months to surface.

A couple pollies in c.s.y2k used to hoot at my theory that a large company could possibly forget and natter about it's revenues, "are we making money, I sure don't know, do you?"

Well, guess what. I was wrong. It didn't take 6 to 9 months. It turns out that it can take a year or longer. Here's the story from Reuters. I've clipped in the whole thing rather than just including the link because this is big breaking story and not a manifesto. Please keep using links for the various manifestos.

========= Start Clip ===

[Fair Use: Educational & Research Purposes]

Dollar General probing accounting irregularities (UPDATE: adds closing share price) By Anna Driver

CHICAGO, April 30 (Reuters) - Dollar General Corp. (NYSE G - news) on Monday said it is investigating accounting irregularities and possibly fraudulent behavior and will need to delay its fiscal first- quarter earnings report and restate prior results, which sent the discount retailer's shares down 31 percent.

Dollar General said it expects to restate financial statements for fiscal years 1998 and 1999 as well as unaudited financial data for the fiscal year 2000. The company has also postponed the publication of its annual report and its annual meeting.

Shares of Goodlettsville, Tennessee-based Dollar General ended off $7.38 at $16.50, a decline that shaved about $2.5 billion off its market capitalization. The stock was the second most actively traded on the New York Stock Exchange with volume of more than 19 million shares.

A company spokesman would not comment further on the investigation and said the company has not scheduled a conference call with investors and analysts. The lack of details from Dollar General contributed to the stock's weakness, analysts said.

``These things never have a good impact on the stock,'' said Mark Mandel, retail analyst with Robinson-Humphrey. ``How severe an impact it has depends on the nature and the severity of these issues, and most of us don't know what they are right now.''

Based on the company's preliminary investigation, management estimates a reduction in aggregate earnings of about 7 cents per share over the three-year period, from the previously reported three- year total of $1.81 per share.

One fund manager characterized the stock's decline as an overreaction.

``I think the punishment far exceeds the mistake,'' said Frederic Russell, chief executive and president of Frederic E. Russell Investment Management Co. ``Sure there may be other revelations that may not be savory or appealing, but I believe the chance of that is small.''

Russell, whose fund has a Dollar General stake valued at about $2.3 million, said he bought an additional 15,000 shares after news of the investigation was released.

Dollar General said the restatements are not expected to have a material effect on future earnings. It said it still backs its previous forecast for operating earnings per share of 71 to 73 cents for the current fiscal year. Analysts on average had expected a full- year 2000 profit of 73 cents a share, from a range of 70 to 75 cents a share, according to Thomson Financial/First Call.

The company's audit committee hired the law firm of Dechert Price & Rhoads to assist with its investigation and accounting firm Arthur Andersen LLP was retained as well, Dollar General said.

Dollar General and the audit committee are reviewing allegations of fraudulent behavior in connection with certain of the accounting irregularities and are reviewing the company's internal accounting controls and financial reporting processes.

Analysts speculated that the irregularity may have something to do with the way Dollar General accounts for its inventory.

``This action is unprecedented in the history of our company and is certainly regrettable,'' Cal Turner, Dollar General chairman and chief executive, said in a statement.

``I am confident that our investigation of these matters will result in a thorough review of our previously released financial statements for each period and will also establish the leadership and processes that will prevent these accounting irregularities from recurring,'' he said.

After the announcement, Moody's Investor Service said it may cut Dollar General's debt rating, affecting about $200 million in debt securities. S&P then said it may also cut the company's debt rating.

In February, Brian Burr, the company's chief financial officer, resigned and was replaced by parking industry executive James Hagan. At that time, the company described Burr as a ``management generalist'' who took on financial responsibilities.

Dollar General's annual meeting was originally scheduled for June 4, and its first-quarter earnings report was slated for May 14. Neither event has been rescheduled.

Dollar General operates more than 5,000 stores in 25 states.

============ End clip ==

This one is fascinating for several reasons. These problems happened so early that it could be a Jo Anne Effect. The JAE was the idea developed by Jo Anne Slaven, an accountant and not a programmer, who speculated that there would be accounting errors pre-Y2K as the code attempted to slot Fiscal Year 1998 or 1999 transactions by comparing the transaction date against the end bound of either the calender year or the fiscal year.

If you had an inventory transaction for March 1999, which might be Fiscal Year 1998 (it's just a name and not a real year), the code has to compare March 1999, 9903 against the end bounds, one of which might be January 1, 2000, 0001.

Is 9903 less than 0001? No, it's not. So that inventory transaction is "lost". The pollies didn't believe that this would happen, and if it did, they thought that these problems would be uncovered in a few hours.

Even if this isn't Y2K, tell me again why it happened and why it took so long to uncover.

Dang pollies. Some kind of obscure, can't possibly happen, accounting problem just shaved 2.5 billion dollars off the value of one company. Somewhere out there, there are a bunch of poor old geezers and geezettes who just dropped from the canned tuna to the canned cat- food diet.

Dang pollies. A few more companies have problems like this and pretty soon, we'll be talking some real market losses.

When only a few JAE's surfaced, the nasty stinging pollies called Jo Anne names. Little did any of us realize that it can take years for accounting discrepancies to surface.

Why am I going on about this? Isn't Y2K over? Didn't the market keep going up, up, up? Isn't gas $.879?

Lock down time, gang. Toss a twenty into a coffee can. Roll your change. When you have 50-60 bucks, slam that into a savings account. When you get up to a grand or so, buy a six month CD. Every now and then, take the 50-60 bucks and buy some silver rounds.

Make a nice meal of pasta and that beef with red wine and cilantro recipe, I make it a buck a person for a passing-out size serving. That'd be 6 oz of meat, carrots, and a heaping plate of pasta.

We're gonna get through this. No matter how it plays out, we'll do fine and will be in a stronger position.

Take care.

Cory Hamasaki __________________________________________________________________

Message: 7 Date: Tue, 1 May 2001 00:40:52 EDT From: Subject: Re: Y2K, you decide.


Sounds like the same problem with the construction companies I told you about yesterday if ya ask me.... Nothing noticed until end of year audits.......

Kath ----------------------------------------------------------

End of quoted material from Cory H.'s list

-- Paula Gordon (, May 01, 2001.

Is there a full moon or what?? I have yet to see such a blatant case of utter stupidity on display as this poster has demonstrated to us tonight. He states first "If he knows the power crisis in California is caused by Y2k breakdowns, he can't admit it and if he doesn't know, he is either being misled by his staff or is too dense to understand the implications of the Y2k problems."

California's power crisis has been over a decade in the making. There hasn't been a power plant built in that state or major tranmission lines placed in that state in over 13 years. During those same years, California has grown beyond the capacity of its system. If you add no new capacity but are growing at an annual rate over 3%, how do you supply all those new residences and businesses? Y2k?? Hardly, try forced deregulation when the market was not ready for it under the rules California imposed upon its utilities.....

Then, he contiues with this gem, "There is an interesting thread today on the Timebomb 2000 site by Paula Gordon where she demonstrates convincingly that the embedded systems problems are a major contributor to the problems in California yet you hear nothing about it in the press. " Thud...... Paula Gordon has demonstrated convincingly that she is an utter moron without a total clue to computer systems. She will milk this for as long as there are fools out here that buy her line of bull. She cannot come up with a worthwhile project on her own, so she has hi jacked a non event to make one up. You want to talk about dishonest again? Thank God the press is smarter than you to fall for this junk science. There is and never was an embedded problem due to Y2k and it is certainly NOT the reason behind California's problem. You clearly don not have a grasp on computers, please don't try to analyze the economy. And this is my all time favorite bit, "It turns out that Cory H, Ed Yourdan, Gary North, Bruce Beach and the other people ringing the alarm bells were correct and the pollys who said the problems were overblown were dead wrong"

ROFL!!!!! They were all DEAD WRONG!!! The pollys, as it turned out, were correct in their collective derisive laughter of the doomers! Now, we can say, we pollies are the true GI's of Y2K. There is nothing more to say.

-- Rob (, May 01, 2001.

There is a "three headed" Energy Crisis (shortage and high prices) emerging, which includes liquid petroleum products (gasoline, diesel, jet fuel) and natural gas and electricity. The natural gas and electricity shortages are generally acknowledged to be at least partially due to bottlenecks in transmission, distribution, or transportation. This is very unlike past energy crises in the 1970s, which only impacted liquid petroleum products.

It is the optimists who hypothesize that these problems are, at least in the short term, at least partially Y2K Bug related. If Y2K Bug bottlenecks are not a factor in this unprecedented triple-headed energy crisis, then the conclusion is that the grim "running out of resources" scenario of the Club of Rome's "The Limits To Growth" is the immediate cause (combined with human shortsightedness to see it coming and develop alternatives in time.) This general scenario is discussed in depth on Internet sites and .

Is man now at the "leading edge" of the inevitable depletion of fossil fuels, and the end of the fossil fuel age? Or have the Y2K Bugs constricted fossil fuel use capacity earlier than the ultimate limits imposed by the ever rising difficulty of extracting more and more of an inherently nonrenewable resource?

If the former is true, then there will be NO relief from this energy crisis, it will only get steadily worse and worse; until Eiensteinian mass energy conversion technologies and/or renewable energy technologies are successfully and safely deployed, and on a truly massive scale. On the other hand, if the Y2K Bugs are a significant contributing factor to this energy scarcity, Y2K has in effect "rung the alarm bell" a bit early, giving man an "early warning" of the subsequent "running out of resource" scarcity to follow in a decade or so. As Y2K is a solvable problem, the result is that the "gross energy use curve" will exhibit a flattened top in the 1999 to 2004 time period, rather than the projected "blowoff top" from 2001 to 2005 or so. This gives man a few critical extra years of warning, with "feedback" to spur action as well, before fossil fuel resource depletion sets in.

In effect, if Y2K has indeed caused some painful constriction in fossil fuel use, it could well have the very favorable long term effect of giving man the extra time and early feedback needed to avert the worst consequences of the inevitable end of the age of fossil fuels. The short term pain may well be very much worth the long term gain.

But if Y2K is not a factor, then the prospects for modern industrial civilization look very bleak indeed. What will happen in the next decade or so will closely resemble the effects of "Y2K" as stated in 1997-1999 by the worst pessimists (InfoMagic, Milne, Gary North); but in agonizingly slow motion. (This grim "crucifixion" scenario too, is clearly textually depicted in the above referenced websites.)

-- Robert Riggs (, May 02, 2001.

The website references failed to post for unknown technical reasons. These aren't active hyperlinks, but will at least display. They are:


-- Robert Riggs (, May 02, 2001.

Very interesting post, Tom. Robert Riggs' reply is an excellant reminder to my family that the Y2K warning and the increased knowledge acquired of how our world works while prepping for Y2K will be priceless as this energy crisis unfolds. We 'Thank you'.

-- George Lyda (, May 02, 2001.

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