Greenspan Says Hype Is Biggest Y2K Risk : LUSENET : TimeBomb 2000 (Y2000) : One Thread

look for the Markets to bounce back on "good news"... he's spewing bile right now...

Greenspan Says Hype Is Biggest Y2K Risk

Updated 1:02 PM ET

October 15, 1999

WASHINGTON (Reuters) - Federal Reserve Chairman Alan Greenspan said Friday the biggest potential danger from the Year 2000 date-change was the "uncertain response" of the U.S. consumer rather than any large-scale computer failures.

Addressing the National Italian American Foundation, the head of the U.S. central bank reiterated that the so-called Y2K computer problem was unlikely to cause any major disruptions as long as both consumers and businesses avoided hype and panic.

"Let us not lose sight of the fact that the overwhelming majority of us are not only prepared but have contingency plans to deal with breakdown," Greenspan said in remarks prepared for delivery to the group.

"The potentially most important piece in the Y2K puzzle for the rest of the year is the uncertain response of the American consumer as the year-end approaches," he added.

The so-called millennium bug could prevent some computers from distinguishing 2000 from 1900 because of an old programming shortcut, which could cause them to malfunction.

But Greenspan said the vast majority of banks and businesses -- and the Fed itself -- had done all they could to reduce the danger of wide-spread technical failures. "The probability of a cascading of computer failures in mission-critical systems is now negligible," he noted.

With that, the focus had shifted squarely to consumers' and businesses' attempts to prepare for the year change, he said. "If we avoid fear-induced, significant economic responses in the months ahead, the Century Date Change will hopefully replicate the saga of 'the dog that did not bark,"' Greenspan said.

His remarks did not address the outlook for U.S. interest rates or the stock market. Greenspan Thursday rattled investors by suggesting banks should make better preparations for the possibility of a sharp contraction in financial markets, suggesting he is still worried about a potential bubble in U.S. equity prices.


please note that he is speaking live yet this story has already appeared...



-- Michael Taylor (, October 15, 1999



please note that he is speaking live yet this story has already appeared...

That's because they released the text of the speech before he delivered it.


-- TECH32 (TECH32@NOMAIL.COM), October 15, 1999.

If this was ment to reassure the markets, I don't think so.

Greeni is not concened with the drop, maybe he likes it?

-- Helium (, October 15, 1999.

This is an old speech, why did he give it all over again ?

-- hamster (, October 15, 1999.


Thanks, that finally dawned on me. I'm still impressed with the fact that the article appeared even before the speach was over : )



-- Michael Taylor (, October 15, 1999.

Helium, yeah, I don't think it was a speach meant to reassure the market. I meant that if the market was looking for a reason to bounce back then this might give it one...lots of bulls grasping for any good news.

But, in retrospect, I can't imagine that his talking about hype, hoarding and build ups in inventory would reassure the markets either.



-- Michael Taylor (, October 15, 1999.

The real news, if any, will be substantive off the cuff remarks. I'm not holding my breath.

-- Rob Michaels (sonofdust@watching.too), October 15, 1999.

Its old, about a month old, here is the link.

-- hamster (, October 15, 1999.

hamster, it was pretty much the same exact speech that Ed wrote his Open Letter in response to.

Rob, no off the cuff remarks that related to Y2k...only at the beginning which, paraphrased, went something to the effect of, "I was hoping you'd run out of time and I wouldn't have to speak." Yes, that is true.



-- Michael Taylor (, October 15, 1999.

Anyone see the post speech interview of Paul Mitchell (hair salon guy) by Maria Bartiromo (sp?). Stupidest thing I ever heard, he said nothing is going to happen and everyone in the Hair care industry is keeping a very positive outlook and thats all you had to do. If everyone is positive we will have no problems and Alan Greenspan the most powerful man in the world said so and thats enough for him.

Maria brought up the fact that Al said some negative stuff last night and Mr. Mitchell said that we have new information today and all is going to be fine. Idiot. Moron. Why was this jerk interviewed.

-- hamster (, October 15, 1999.

"Let us not lose sight of the fact that the overwhelming majority of us are not only prepared but have contingency plans to deal with breakdown," Greenspan said in remarks prepared for delivery to the group.

bReAkDOWn?! What!? Who said there was going to be a Y2K breakdown?! um... Greenspan just did!

Sincerely, Stan Faryna

-- Stan Faryna (, October 15, 1999.

Just saw an interview that Maria Bartiromo did with Paul Mitchell (the hair guy) He said that if Greenspan said it, it must be so. There will be no Y2K problems. This guy needs to get his head out of the sink.

-- (, October 15, 1999.

blah blah blah. Greedspin is robot-parroting his old hash, carefully coordinated Spin. He's irrelevant, passe already.

11 WEEKS !!!

-- Ashton & Leska in Cascadia (, October 15, 1999.

From CNN
Greenspan embraces Y2K 
Says U.S. is good to go for year-2000; stays mum on stocks, economy 
October 15, 1999: 1:18 p.m. ET  

NEW YORK (CNNfn) - Disruptions caused by the year-2000 computer glitch will more than likely be minor, and U.S. businesses and consumers are as prepared as they can be to deal with it, Federal Reserve Chairman Alan Greenspan said Friday.

Speaking to the National Italian American Foundation in Washington, D.C., the Fed chief focused his comments on year-2000 readiness -- not the current state of the economy and financial markets, as he did Thursday evening.

Those remarks, combined with a stronger-than-expected report on producers' costs, prompted renewed concern among investors about overvalued stock prices and rising interest rates, sending stock and bond prices sharply lower on Friday.

Instead, Greenspan talked Friday about Y2K and how businesses and consumers have come to understand and deal with the potential effects of computers malfunctioning on Jan. 1, 2000.

"The good news is that evidence is becoming more persuasive that our electronic infrastructure will be ready for the Century Date Change," which Greenspan abbreviated as CDC. "The public's understanding of the degree of our Y2K readiness also has grown, and fears of widespread disruptions around the CDC appear to be waning, though we are not as yet home free."

"As we prepare for the rollover, it is most important to keep in perspective just how far we have come in our Y2K preparations," Greenspan said. "While it is easy to obsess about the few institutions in our society that may not be ready, let us not lose sight of the fact that an overwhelming majority of us are not only prepared but have contingency plans to deal with breakdowns," he said.

The Federal Reserve has made special arrangements to have extra currency available on the off chance that consumers and businesses withdrawal a significant amount of funds from the U.S. banking system, leaving little or no cash available, Greenspan said.

However, "I trust that such withdrawals will be modest since, as I have said before, the safest thing for consumers to do with their money around year-end is to leave it where it is."

-- lisa (, October 15, 1999.


What he said was that we have contingency plans to handle breakdowns. He did NOT say there would be breakdowns. Like if you say you have fire insurance, did you actually say your house *would* burn down?

Contingency plans don't cause contingencies. They are not assurances of those contingencies. They are *in case* of contingencies.

Sheesh. If that isn't deliberate misinterpretation, I don't know what is.

-- Flint (, October 15, 1999.

Text of today's & yesterday's Greenspan speeches now up : CHES/1999/

-- restless (, October 15, 1999.

Re: the biggest potential danger from the Year 2000 date-change was the "uncertain response" of the U.S. consumer

So, if there is a problem with the Year 2000 date-change, then it is all the fault of the U.S. consumer and his/her uncertain response? Gosh. Well, I won't be part of the problem, then. This red-blooded U.S. consumer is responding with certainty to potential danger by preparing ahead of time. Okey doke. I'm off to get more canned stew and lamp oil.

-- Margaret J (, October 15, 1999.

hamster -

I thought you were kidding about that Paul Mitchell interview. She actually talked with some guy who runs a hair care company about Y2K? LOL! The guy's very successful, certainly, but gimme a break. The hair care biz is purely discretionary and extremely vulnerable to economic downturns. Did Maria B. really think ol' Paul was going to have anything but good news about the economy and Y2K and such. *sheesh*

Ooops! Dow just dropped more than 240. I thought the "collar" went on after 210, to let everyone build up a wave of sell orders, errrr, cool off a bit. hmmmmm....

-- Mac (sneak@lurk.hid), October 15, 1999.

Mr. Greenspan, by law, cannot say anything that would instigate a bank run.

I do think in reading many of his speeches, he like many others, is personally dreading The Stupid People exhibited in areas such as Florida, who race down the Day Before in a Panic, wreck havoc, cause civil unrest, and obliterate the stores to say the least. Most people have lost their tolerance for those Day Before Folk. Society has been very polite and tolerant of the Day Before People but the evidence is overwhelming they are low animals who have not made it up the evolution ladder. I do not think he in any way means those who purchased some eagle gold coins, bought a swell deal on meals, and a wood burning stove earlier, because all those items are in the economic fold that Mr. Greenspan is supposed to oversee. If Mr. Greenspan did not want to see gold coins, swell meal deals and stoves sell as much as Sony boom boxes he would be fired from that job. He is picturing the Day Before Panic in Florida. He knows the lower breed is going to race down hysterically to the banks, have lines out into the bank parking lots, get into some shopping cart riots, tear through the stores obliterating them having more fights, and on their way home they will suck up all the gas there is be to had with even more fights between themselves.

This is too late for people to prepare for a long winter. They were to have done so, if they chose to do so, in 1997, 1998, and early 1999 which included movement in the stock market. He was ideally at this time period supposed to be managing the "aftermath" in all respects, stabilizing it, and leading it towards an appropriate solidity.

It is inappropriate professional behavior for Mr. Greenspan to shake his fist and yell, "You clueless low life animals and your Day Before Behavior, you're destructive, a burden, and no nation on earth would want you!" What can he say?

-- Paula (, October 15, 1999.

I think there is going to be more and more folks who are willing to make statements, in the lime light, that everything is well. As we get closer to the event these Polys on one side, and the doomers on the other will be quite well known. We now however live in a day and age of list and little black books. If I was a doomer and in the lime light, next year I would be laught at only for a short time, then all would be back to normal, up up and away. BUT if I was a Poly making statements in the lime light, that everything is well, dont store food, water, etc.etc. and it turned out to be everything the doomers talked about, then know-one forgets. Out comes the black books...---...

-- Les (, October 15, 1999.

Greenspan's old speech may have been used at the last minute, rather than for him to have to say ..........."its over folks"............... Just before the crash of '29, they used a lot of ploys to try to hold it together for one more day or one more hour, just trying to hold off the inevitable. Perhaps Greenspan just didn't want to come right out and say it. Maybe from where he sits "Y2K really isn't anything," that is compared to market crashes and bank runs, and the following economic situation. Just a thought.

-- Nancy (, October 15, 1999.

Ditto here...

Fed chief says buying patterns could rile millennium bug
JEANNINE AVERSA, Associated Press Writer
Friday, October 15, 1999 article.cgi?file=/news/archive/1999/10/15/national1654EDT0738.DTL

[Fair Use: For Educational/Research Purposes Only]

(10-15) 13:54 PDT WASHINGTON (AP) -- The millennium computer bug should not disrupt the nation's economy unless consumers and businesses significantly change their buying patterns, Federal Reserve Chairman Alan Greenspan said Friday.

In remarks to the National Italian American Foundation, Greenspan expressed confidence that American business will be ready for the Year 2000 date change given the intensive preparations they have made to prepare their computers.

``The probability of a cascading of computer failures in mission- critical systems is now negligible,'' Greenspan said.

Nevertheless, Greenspan said, even though the public's understanding of the matter has grown and fears of widespread disruptions waned, ``We are not as yet home free.''

Greenspan said he still is apprehensive over the potential for economic impact of hoarding or other significant changes in traditional spending patterns.

That's why it is crucial for authorities to get out the most up- to-date and reliable information to ensure that businesses and consumers make economic judgments based on facts and not rumors, he said.

``Accurate, credible and timely information on the general state of readiness will be essential to reducing uncertainties in the months ahead,'' Greenspan said. This way, businesses will be able to base their decisions on inventory stockpiling on accurate information and not overstock out of unfounded fears.

Consumer reactions also will be critical to determining whether the computer change will have a major impact on economic activity, he said.

To this end, Greenspan repeated his warning that banks will remain safe for people to keep their cash. ``The safest thing for consumers to do with their money around year-end is to leave it where it is,'' he said.

So far, only a ``small number of households, driven by fear of the unknown, tell pollsters that they are planning to build large stockpiles of food, water, fuel and cash as the millennium approaches,'' Greenspan said. But he expressed anxiety about a rising level of consumer worries as the news media focus more attention on the question.

``It is too compelling a story for audiences that thrive on countdowns to the unknown,'' Greenspan said.

``As attention heightens and rumors inevitably mushroom, it is important that what is known and what is not known be clearly articulated by those of us in both public and private leadership positions,'' he said. In the end, he said, ``facts are the only antidote for rumors.''

The so-called Y2K problem exists because many older computers and software programs recognize only the last two digits of the year and could mistakenly interpret ``00'' as 1900.

-- Diane J. Squire (, October 16, 1999.

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