Can the government "freeze" the stock market? What would happen? Would peoples earnings just remain static? What would happen to the companies? What if we didnt shut down the banks, but only limited the amount of cash people could take out of the bank? I mean, most transactions are done by check, credit card and debit card, arent they? What if there was a massive effort to distribute debit cards to everyone? Then we could finally speak freely and honestly about Y2K status and preparations. Is this idea way off base? I know going cashless now doesnt solve any potential problems after Jan. 1, 2000, but by God, at least we could discuss everything openly without this crushing fear of panic thats going on now.

-- Just Wondering (justwondering@thispoint.com), May 11, 1999

Answers

I don't think you can just kiss off all of the all cash operations like convenience stores, fast food places, coin vending sites, etc.,etc.

-- dave (wootendave@hotmail.com), May 11, 1999.

>Can the government "freeze" the stock market?

AFAIK the U.S. stock markets (plural) are all private enterprises, but there are federally-controlled institutions on which they depend for operation, so could effectively be shut down various ways.

Don't know how parallel the stock markets in other countries are.

>Would peoples earnings just remain static?

You mean wages? No direct effect (except for exchange employees, floor trading specialists, and such), I think.

Now, _in_directly, the implications of shutting down stock markets would cause all sorts of changes in the decisions and actions of people, which would affect all sorts of things in the economy.

>What would happen to the companies?

Well, they could just continue operating as usual. Anyone who wanted to buy or sell their stock would have to do so off-market. If a company had to purchase stock for an employee stock purchase plan, for instance, it would be very inconvenient -- probably, practically impossible on short notice -- to have to do it off-market.

But, again, the implications and side effects of a market "freeze" would far exceed the direct effects.

>What if we didnt shut down the banks, but only limited the amount of cash people could take out of the bank?

A moderate number of people would be directly affected by being unable to obtain currency immediately, but a far larger number would be frightened by the implication that there wasn't enough currency to go around.

>What if there was a massive effort to distribute debit cards to everyone?

This wouldn't solve any problem, if that's what you mean. Debit cards are basically just electronic versions of paper checks for most purposes, and we already have paper checks for accounts.

>Then we could finally speak freely and honestly about Y2K status and preparations.

That's a nice goal, but I don't see how any of the measures listed here would accomplish that. The inhibitions to speaking freely and honestly about Y2K status and preparations are far more psychological or legal than they are fiscal.

>I know going cashless now doesnt solve any potential problems after Jan. 1, 2000, but by God, at least we could discuss everything openly without this crushing fear of panic thats going on now.

Not really. All the cashless transactions are processed by computers, the very machines that are subject to the Y2k problems.

-- No Spam Please (No_Spam_Please@anon_ymous.com), May 11, 1999.