FED Board member Edward Kelley, Jr., testified that the Federal Reserve System will spend $100 million to get compliant.
There is another problem: the threat of noncompliant data sent in by corresponding institutions.
It's a really big problem -- a lot bigger than Mr. Kelley indicates. If noncompliant bank A sends bad data to the FED, this will corrupt the FED's computers. Then the FED sends out this bad data to compliant bank (if one exists) B, which sends it out to Bank C, etc.
The FED can't tell the banks in any other countries what to do. It can't close all the noncompliant banks in this country.
Once again, I'll say it. I'm still the only one saying it. So, I'll keep saying it. This is a systemic problem. It cannot be fixed.
This is from FEDERAL COMPUTER WEEK (April 28).
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The Federal Reserve will spend about $100 million to fix its computer systems for the Year 2000, a Federal Reserve official told Congress today.
Edward Kelley, a member of the Board of Governors of the Federal Reserve System, told the Senate Committee on Commerce, Science and Transportation that the Federal Reserve, like many federal agencies, is having difficulty with the private organizations that are linked by computer directly to its operations. In the Federal Reserve's case, its "data partners" are banks and other financial institutions.
"We do not have very much information at all about exactly what they are doing [to solve their Year 2000 problem] or what state of preparation they are in," he said. "They have been very tight with providing information, and we would like very much to have more technical information."