A Reuters story (Nov. 19) quotes a Federal Reserve official in regard to noncompliant foreign banks. The implications of what he said are stupendous. He says that the FED may suspend all transactions with noncompliant foreign banks in 2000. This is tantamount to shutting down the international banking system.
I'm referred to as a doomsayer for saying this. Now the word is slowly getting out. We are heading for an international collapse.
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MIAMI--The Fed's central bankers fear regional economic issues may distract European and Asian banks from dealing with a "millennium time bomb" threatening the world banking system, a Federal Reserve official said yesterday.
"It's number one on my agenda every day," William Ryback, associate director for banking supervision at the Fed, said at a Latin American bankers conference. "We at the Fed are terribly worried." . . .
Ryback told reporters that European bankers were working hard on adapting their information equipment for the arrival of a common European currency and had not fully focused on the millennium bug.
Asian bankers, he said, were facing economic turmoil and were unlikely to devote much time to a computer problem, regardless of its importance. . . .
Ryback gave no details but told reporters later that the Fed might bar transactions between U.S. institutions and banks outside the United States if they had not overhauled their computers.