Y2K worrywarts get ready

 

When bug's fixers run scared, where does that leave us?

 

Above all, don't panic. Panicking would be bad. Just because some of the very people who are working on the Year 2000 computer problem say they're worried enough about the world's financial system that they'll horde cash prior to Jan. 1, 2000, doesn't mean you should, too.

 

Just because a guy who's fixing Y2K for a state says he'll take out $40,000 to $50,000 to have on hand, plus stockpile a year's supply of his wife's heart medicine. . . .

 

Last week, the Federal Reserve announced that over the next year or so, it will print billions of dollars more in cash than it usually does. The reason centers on the Year 2000 bug, a k a Y2K, which threatens to crash computers all over the globe once the date rolls from '99 to '00. The Fed says that people might decide to hold onto cash as 2000 approaches — you know, in case either the ATMs don't work or nuclear war breaks out. The Fed calculates that families will hold an average of $450 cash for this purpose.

 

It's possible that most people never thought much about holding a wad of extra cash because of Y2K, but thanks to the Fed, they will now.

 

In a story on the Fed's plan, banking scholar Martin Mayer was quoted saying: ''I do know a lot of people working on Y2K who expect to go into the year 2000 with a lot of cash under the mattress.''

 

Explosive if true. There's a lot of confusion over whether Y2K is going to be a small disruption or a disaster that will test the girders of civilization. If the people who are working on Y2K — the people who know — feel threatened enough to horde cash, it's like a pilot strapping on a parachute while telling the passengers, ''Don't worry, we'll be on the ground shortly. Oh, and the cocktails are complimentary.''

 

So I tested the premise. I did an e-mail survey of a handful of Y2K programmers and consultants, asking whether they plan to withdraw a lot of cash before 2000. Of nine who responded, five plan to hold extra cash. The degree of concern varies greatly.

 

Let's start with the most out-there response. I had to promise not to use the guy's name because he would no doubt get fired faster than you could say ''bunker mentality.'' But as mentioned above, he is running a state government's effort to deal with Y2K. He wrote that he'll withdraw $40,000 to $50,000 from his accounts to hold in case banks are frozen and cannot dispense cash for long periods. In a subsequent e-mail, he wrote that his wife would die without certain prescription medicines, so he's stocking a year's supply in case drug companies are disrupted by Y2K.

 

Several rungs lower on the ladder of dread is John Scott, a Y2K specialist at IBM. ''With a family of five, an emergency power generator and our own water well, I expect to keep 2-4K in cash,'' he writes. ''The biggie is to move my 401(k) to U.S. Treasuries prior to 10/99 as I think the stock market will have a big problem.''

 

Three respondents are taking the natural-disaster approach, which seems to be quite widely accepted in the Y2K community. ''I'm preparing as I would for a hurricane: a little extra food, water and a small amount of pocket cash,'' writes Phil Murphy, a senior Y2K adviser for Giga Information Group. Even if ATMs go out, he writes, ''There is no reason to believe that the merchants that we normally do business with will no longer accept checks from us.''

 

No respondent said everything will be perfectly normal come Jan. 1, 2000. ''Everyone is going to be at least inconvenienced,'' says Corinne Gregory, a vice president at Data Dimensions. The others in my survey — the calm ones — suggest basic, smart contingency planning.

 

''If it looks like it makes sense to put some money under the mattress, I will do so,'' says Alan Schutte, an independent Y2K consultant. ''It is too early to say that this will be necessary, but I urge anyone I talk with to at least have a plan, just in case.''

 

There is an interesting string running through many of the responses. Many worry that the fear of Y2K might end up being worse than Y2K itself. Most financial institutions are likely to be Y2K OK, writes consultant Jack Webb. But a few will have problems that will be publicized. ''Bad publicity begets consumer worry,'' he writes. ''Consumer angst generates the run on cash.''

 

So after learning all this, what are my plans? For better or worse, probably about the same as when the pizza delivery person shows up at the house and our wallets are drained: We'll ask our 7-year-old if we can borrow from her impressive stash of birthday money.

 

I'll have to go on faith that her blue plastic treasure chest is Y2K compliant.

 

By Kevin Maney