[interdoc-y2k 304] Edward Yardeni's current view

[Bob Olsen <bobolsen@tao.ca>]

From: Richard.Stapells@bmo.com
To: INTERNET-BOBOLSEN * <bobolsen@tao.ca>
Subject: Y2K: Edward Yardeni's current view
Date: Fri, 26 Mar 1999 08:39:43 -0600


LA Times story on Y2K as follows:

"Edward Yardeni, chief economist for the investment banking firm
Deutsche Bank Securities Inc. and one of the most persistent
drumbeaters on the Y2K issue, recently revised his estimate for a long
global recession due to the glitch, from a 70% chance to 45%. "I've
toned down the message partly because progress has been made," Yardeni
said. "I would be happy to back off entirely."

I still see a 70% chance of a global recession. Previously, I've
written that it could be as bad as the 1973/74 downturn. In my Feb.
22, 1999 Y2K REPORTER, I listed five possible Y2K outlooks, which
include three recession scenarios and probabilities: 25% for a mild
recession, 40% for a bad one, and 5% for a depression. The
probability-weighted average is a 3% drop in real GDP lasting about 12
months-a bad recession. Of course, I would be more than happy to turn
less pessimistic-and I will do so-if I believe the available data
warrants such a change. My aim last year was to raise awareness and
alarm to stimulate greater efforts to fix the problem.  This year my
goal is to promote contingency planning to minimize Y2K disruptions. I
tend to agree with my friend Peter de Jager, who believes that
doomsday will be avoided, and Peter deserves a great deal of credit
for his efforts. Nevertheless, I doubt a serious recession will be
avoided.
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   .............................................
   Bob Olsen, Toronto            bobolsen@tao.ca
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