Fed Official Discounts Forecast of Y2K Recession..........Pass the Xanaxgreenspun.com : LUSENET : TimeBomb 2000 (Y2000) : One Thread
Has anyone else seen the story, carried in Cleveland as a Boston Globe piece about Cathy Minehan and her take on Y2K? She is disputing Ed Yardeni's 70% deep recession prediction and indicatesd that she believes the DRI/McGraw Hill report which suggests a 20% recession possibility probably offset by a 10% ramp up in inventories and computer equipment in the last quarter of 1999. This report indicates an expected drop of 0.2% in GDP in 2000 (yes, I quoted it correctly from the CPD- two tenths of a percent drop in GDP) with "a 20% probability that reality will be this bad or worse."
Referring to Y2K, Minehan "has a lot of respect for Yardeni. It just doesn't seem frealistic to say it would produce a recession, all by itself."
Quoting the PD==>
Minehan's comments were part of a broad push by the Fed to bolster public confidence inthe ability of large financial institutions and the central bank system - the lifeblod of the economy - to cope with the date change.
Without naming specific economists, Fed Governor Edwad Kelly told a Senate committee last April that fortecasts of a Y2K-induced recession were "probably a stretch." Kelly and Minehan are among four co-chairs of a Fed committee preparing the US central bank for 2000 and assessing the potential impact on the economy.
Her comments take on added significance because she is also chairwoman of a separate Fed committee that has been working for more than two years with the 12 regional banks and their member financial institutions to prepare for 2000.
On that point, Minehan said; "Everything at the Fed that is mission critical is Y2K ready."
"It's not realistic to think that there will be no glitches either. There will be glitches," she said. "But, as far as we can see, at this point, a reasonable scenario is that most important things will work, at least from the perspective of the financial services arena."
(Excerpts provided due to unavailability at either www.clevelandlive.com or www.bostonglobe.com).
If I missed this earlier, I am sorry about double posting. Beyond that, I am totally, for the first time in a long time (and my spouse knows how long) at a complete loss for words..........
Chuck, hunting for his Xanax.
-- Chuck, night driver (firstname.lastname@example.org), January 25, 1999
Now Chuck, relax. She may be correct. I think she is talking about the first few hours of next year. By the way, I'm still looking for the facts. Must have missed them....
-- Mike Lang (email@example.com), January 25, 1999.
Pendulum swings, Chuck.
Many people only "see" their corner of the world. She did say ...
"There will be glitches," she said. "But, as far as we can see, at this point, a reasonable scenario is that most important things will work, at least from the perspective of the financial services arena."
I'd like to know her definition of the "most important things."
-- Diane J. Squire (firstname.lastname@example.org), January 25, 1999.