This appeared in the TIMES OF INDIA (June 2).
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``No one really has a clue just how big this problem will be,'' said Don Smith, international economist at HSBC Midland. ``We have never experienced anything like it before. There's a huge interdependency between systems which makes predicting the results of computer failure an impossible task really.''
JAPAN COULD PRECIPITATE BANKING CRISIS: Smith was concerned about the impact on the financial system outside the US and Britain, particularly Japan.
``I worry about Japan because the financial system is so very weak. Many banks are close to insolvency at the moment. If there is a major crisis of confidence in the banking sector which this kind of phenomenon could prompt, Japan is vulnerable.
``The risks of contagion are more in the financial sector than any other. The Japan banking system threatens the whole global banking system,'' according to Smith.
Deutsche Morgan Grenfell's Yardeni shares this fear about Japan in particular and Asia generally.
``Asian countries have a Year 98 problem; they are just trying to survive this year. I'm becoming increasingly convinced that Asia is toast in the Year 2000,'' Yardeni said.