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Summary and Comments

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Category: 

Stock_Market

Date: 

1998-02-10 11:12:47

Subject: 

No Second Chance in 2000, Warns Securities Spokesman

  Link:

http://www2.computerworld.com/home/print9497.nsf/All/SL6pacific17ECA

Comment: 

The need for the securities industry to get its systems repaired, and then get all systems to coordinate with each other ("interoperability"), is crucial. Public confidence depends on this.

The industry will run a prerliminary test in March, 1999, on interoperability. What if it fails the test? They will try again in October.

Then there is the question of public utilities. Programmer Ed Yourdon warns that they are not compliant and nowhere near compliance. Yourdon is wrong, says a securities industry spokesman from Merrill Lunch. It will all be fine this summer. (Don't worry. Be happy.)

This story is from COMPUTERWORLD (Feb. 9).

* * * * * * * *

The financial sector, one of the most proactive industries in preparing for the year 2000, will kick off limited interoperability testing in July a good 18 months before the millennium strikes.

The pilot, to be conducted by the Securities Industry Association, will involve about 30 institutions, including top stock exchanges, brokerages and banks. It will be the first indication of how well those companies can transmit data among their respective networks, said Art Thomas, chairman of the SIA's Year 2000 Steering Committee and senior vice president of global operations services at Merrill Lynch & Co. in Jersey City, N.J.

Testing will take place on four consecutive Saturdays beginning March 6, 1999. . . .

``Depending on how that goes, we may conduct one more interoperability exam in September or October,'' said John Fitzgerald, vice president of marketing at National Securities Clearinghouse Corp. (NSCC). . . .

``We had to get the bulk of our year 2000 upgrade done by this point or risk losing business and our customers' trust because we didn't have accurate financial reports and records,'' said Dave Eisenlohr, vice president of data center operations at the Pacific Stock Exchange in San Francisco. ``Come Jan. 1, 2000, we don't have a second chance to get it right.'' . . .

Another hurdle confronting the exchanges is contingency and disaster-recovery planning. Many exchanges have barely begun to address the issue [CW, Jan. 19]. . . .

Lagging year 2000 upgrade initiatives in the utilities and telecommunications industries could have a severe, adverse impact on Wall Street's ability to conduct business, said Edward Yourdon, author of Time Bomb 2000.

``The securities industry won't be able to do any trading if the power is off and the phones aren't working,'' he observed.

Very few U.S. utilities are year 2000-compliant, Yourdon said. ``One-third of the utilities are on schedule for their year 2000 upgrades, one-third are behind schedule and roughly one-third haven't even begun to address the issue. And yet this tardiness [on the part of the carriers and utilities] doesn't seem to register with the financial community,'' he said.

Not so, said Art Thomas, a senior vice president at Merrill Lynch & Co. in Jersey City, N.J., who leads the Securities Industry Association's Year 2000 Steering Committee.

``We will conduct bilateral tests with various telecommunications and utilities companies across the country this summer,'' he said.

Link: 

http://www2.computerworld.com/home/print9497.nsf/All/SL6pacific17ECA

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