Mr. Chairman, I want to commend you for holding this hearing on the Year 2000 computer
problem. The Banking Committee has taken the lead in the Senate on this matter, and this
hearing is the Subcommittee's fourth on Year 2000 issues this year. Previous testimony before
the Subcommittee has been disturbing. Several witnesses have spoken about the pervasiveness
of the problem in sectors vital to the economy, such as financial services and
telecommunications. Others have discussed the multi-billion dollar cost of fixing the millions of
lines of computer code involved. Dr. Edward Yardeni, who appears before the Subcommittee
again this morning, previously indicated to us that there is at least a one in three chance of a
major worldwide recession due to the Year 2000 problem, and I believe he has increased those
odds since he spoke to us.
I applaud you, Mr. Chairman, for bringing all of the financial regulators before the
Subcommittee to focus them on the urgency of the Y2K situation. I believe that the Banking
Committee's attention has helped to push both the regulators and the institutions they regulate to
find solutions to the problem. The century date change could cause disruptions in the financial
sector, which is heavily dependent upon computer technology. We need to protect the safety of
our financial system by making sure that such disruptions do not take place.
Today's hearing will address the adequacy of the disclosures that America's publicly traded
firms have provided on their Year 2000 progress to date. This is an important matter for U.S.
investors and the nation's economy, because the free flow of information provides a crucial
foundation for our financial markets. Armed with all of the facts, investors can make intelligent
decisions about where to put their money, balancing the returns they seek against the amount of
risk with which they feel comfortable.
The Securities and Exchange Commission took an important step earlier this year by requiring
companies to be more forthcoming about their Year 2000-related risks. Today we will hear
about the extent to which that guidance has been reflected in the reports filed this year. I
understand that according to at least one of our witnesses, Mr. Hock of Triaxsys Research, many
of these Year 2000 disclosures have been less than satisfactory, and that companies may not be
providing the information that investors need. If true, this is of considerable concern, and I urge
everyone involved to move quickly toward full disclosure.
Thank you again, Mr. Chairman, for holding this hearing today. This is a very timely topic, and I
appreciate your continued attention to this important issue. I look forward to the testimony of
our distinguished witnesses.
Home | Menu | Links | Info | Chairman's Page