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Summary and Comments

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Category: 

Banking

Date: 

1998-04-11 08:44:06

Subject: 

De Jager's Speech to the BIS: "We Can Fix It, Guys, If We Try!"

  Link:

http://www.year2000.com/y2kbasle.html

Comment: 

Peter de Jager delivered a speech to the Bank for International Settlements on April 8. It reinforced the warning by Ed Yardeni. He did not depart from his familiar theme since 1993: we can fix this if we get started now. He ended his speech withe his familiar cheerleading:

"Despite my 'gloomy' message, I remain determinedly optimistic we can solve this man made problem. I believe we have enough people to solve this problem. That we have the tools necessary to solve the problem. That we have the skills required to solve the problem.

"I hope however we can find leaders with sufficient courage and will to solve the problem."

I have no doubt that he will still be delivering this cheery speech in December, 1999.

The problem with this theme in 1998 is that it makes a mockery of all his previous efforts to alert people to the threat. If there never is an inescapable deadline to get started on the fix, short of December 31, 1999, then y2k really isn't much of a problem. Businessmen and governments are wise to delay getting started. After all, think of all the money they save betwen now and, say, December 15, 1999.

I honestly believe that the groups that invite him in to speak do it to justify their decision not to get started just yet. He never gives a deadline for getting started. He never announces a fail-safe date beyond which the system can't be repaired. He is like an amusement park thrill ride. It's scary and fun. Everyone knows no one will get hurt. You can even invite him back next year to give the same speech. "Thrills, chills, but no spills!"

Until Jan. 1, 2000.

He identified the three systems that I have warned since late 1996 are uniquely at risk, thereby placing society at risk: finance, public utilities, and telecommunications. Some other y2k doomsayer has called these three the iron triangle. I think "digital triangle" is a better description. If they go down and stay down, Western civilization will go down and stay down. (If electrical power goes down, they all go down.)

Here is my position. The y2k problem is systemic. It cannot be fixed. The computerized interconnections are too complex. The Dominoes are too tall. This, de Jager won't say. He says he is called a doomsayer. Nonsense. He's a pussycat. I'm the doomsayer.

To put it in the words of Adam Fegurson, the mid-18th century Scottish social theorist, y2k is "the result of human action, not of human design." He based his evolutionary, optimistic, free market social theory on this premise. It works just as well to describe a social collapse.

* * * * * * *

Greetings Ladies, Gentlemen, members of the press,

For the past 7 years I have devoted my life to the communication of a single, simple message.

The computer systems upon which we depend are broken. They must be fixed by Jan 1st 2000 at the very latest. We are not very good at delivering projects of this type on time. . . .

Are the systems broken?

All you need do is look at our systems and you'll see they are. . . .

Must they be fixed by Jan 1st 2000?

Speak to the Year 2000 manager at any multinational who has taken the time to look at their systems and you'll hear the evidence.

Ask them what would happen if they ignored the problem and you'll hear from them, albeit reluctantly, that if they ignored the problem they would lose the ability to do business in the 20th or 21st century. . . .

How good are we at delivering IT projects on time?

Microsoft is one of the best software companies on earth. I recognize we could debate this, but the facts speak for themselves, they have sold more software than any other company in the history of computers.

Here is a question. Listen to your answer carefully, How often has Microsoft delivered any version of Windows on time? Never? . . .

We need only look at our systems, listen to those who have looked, and think about the consequences of a late delivery.

But it would appear most human beings have ears, but cannot listen, have eyes, but cannot see, have minds, but cannot think. . . .

Whether or not we like it or have the courage to admit it, we do have a crisis on our hands.

One additional piece of information for you to consider.

Organizations who have not yet started this project in earnest will tell you not to worry... everything will be delivered on time.

Yet, companies who have been working on this problem since 1994, mostly financial institutions, will tell you, again albeit reluctantly, they will not, cannot, finish everything on time.

They have too much to do, too little time, too few resources, to fix everything they've found to be broken.

BUT they also no longer have any intention of finishing everything. These companies have finally accepted they are faced with a crisis and like in any crisis are now prepared to make strong, difficult decisions. They are deciding to leave unessential systems by the wayside in order to deliver what they must deliver to stay in business. . . .

Without hesitation I can tell you this. After seven years of working on this issue, I know of no companies who will complete Year 2000 effortlessly, without risk of failure. . . .

By itself the Year 2000 is a threat to any and all organizations, and hence to society.

To reduce that threat we need take action. To do that we need leadership, because the actions will involve both courage and sacrifice. To recognize the necessity to act, we must understand the unavoidable consequences of "The code is broken. The deadline is fixed. We're not good at meeting deadlines."

There are three pillars to a modern society we cannot allow to fall.

Finance. That's your job. The money must be accessible. It must be transferable, and people must have confidence in our ability to deliver both of these.

Utilities. Power, water, sewage, all of these must continue to flow... no humour intended. If government does not take immediate, real, action to ensure these services then angry citizens will demand answers as to why, when government was informed of the nature of the problem, they 'let' it happen.

Telecommunications. The phone lines are as important to our society as the roads were important to the Holy Roman Empire. Without reliable communications there are no global or even national economic empires. . . .

My advice regarding the Euro?

Postpone it. . . .

Even as I plead with you, and others, to realize both projects cannot, should not, be attempted at the same time. I know I'm wasting my breath, but I have no choice but to continue.

After any major failure there is always one great defense against blame and responsibility, 'nobody told me!'

I have removed 'Nobody told me!' as a valid defense from the future sessions of appointing blame. The Euro must be postponed in lieu of the Year 2000. Attempting both projects at the same time is dangerous in the extreme. . . .

I have been labeled a doomsayer and yet those who label me as such have never made any attempt to invalidate my basic statements. The code is broken. The deadline is fixed. We're not good at meeting deadlines. . . .

Despite my 'gloomy' message, I remain determinedly optimistic we can solve this man made problem. I believe we have enough people to solve this problem. That we have the tools necessary to solve the problem. That we have the skills required to solve the problem.

I hope however we can find leaders with sufficient courage and will to solve the problem.

Link: 

http://www.year2000.com/y2kbasle.html

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