In two days time, we will enter a new decade. Many people have forgotten what was the big issue at the end of the last decade. It was the so called Y2K bug that never occurred. During the last two years of that decade, management consultants went round to spread the panic that if the Y2K bug was not fixed, computer systems around the world would collapse. This would happen not only to commercial systems but to military systems as well.
Several hundred millions, perhaps more, were paid in consultancy fees to fix the perceived Y2K problem. It frightened top management of big organisations, financial regulators and political leaders. It was a boom time for management and I.T. consultants who had the expertise to fix this imaginary problem. It reminded me of the fairy tale by Hans Christian Anderson told to children, about the emperor's imaginary new clothes.
I was one of very few who dared to argued that nothing would possibly happen and that the Y2K panic was exaggerated. I reasoned with I.T. experts and top accountants, but they argued back more strongly about the potential disasters that could happen. I concluded that they were extremely stupid or dishonest. As they were talented people, I concluded that it must be dishonesty, as they had pocketed large profits from providing the consultancy to fix the problem.
There were hundreds of millions of computers, big or small, around the world that needed to be fixed. Not all of them could be fixed in time and to the specification required by the consultants. It would be reasonable to expect several millions of them, which were not properly fixed, to fail with disastrous consequences. None of the failures occurred. All the computers continued to work fine on the turn of the century.
Companies that spent tens of millions to fix the Y2K problem gave a collective sigh of relief and congratulated their people for averting the disaster. Those who realised that they were conned by the scam of the century were too embarrassed to bring up the issue. This matter was best forgotten, which was what happened quickly.
The following decade brought about its own scams, in the form of the technology bubble, corporate scandals, housing bubble, financial innovation, derivatives, CDOs, CDS and the like. They made super wealth to the "talented" people but the rest of the world that much poorer.
What scams will the next decade bring?
Tan Kin Lian
- ► 2013 (306)
- ► 2012 (1270)
- ► 2011 (1873)
- ► 2010 (2369)
12/27 - 01/03
- Risk and how to manage them
- A more caring community
- Singaporeans are able to see beyond racial lines
- Apply foreign worker levy to other jobs
- Treat immigrants fairly and well
- Community based loans
- Impact of December holidays
- Blind trust - there must be a reason?
- Pushing the buck around
- Morgan Stanley sued over failed $1.2 billion CDO
- Top priorities for the next decade
- Investment return, adjusted for inflation
- Financial institutions bet against their clients
- H1N1 - is it a scam?
- Y2K scam
- Approaching a new decade
- Affordable HDB flats
- Over production
- Expressing my views
- Loan shark menace
- Need for a minimum wage
- Hassle given to travellers
- Alternative to Travel Insurance
- A more responsive Government
- Bad experience with land banking plot
- The Talent Myth
- Talent and fat bonuses
- A good settlement mediated by FIDREC
- Financial sector is too big and unproductive
- ▼ 12/27 - 01/03 (30)
- ► 2008 (2105)
- ► 2007 (1803)
- ► 2006 (696)
- ► 2005 (159)