Test Pushes Wall Street's Computers Into 2000 Without Mishaps
By BARNABY J. FEDER
Wall Street's 10-day-old project to test how its computers will cope with the transition to the new millennium moved forward yesterday to Jan. 3, 2000, the first trading day of the next century, with no major glitches.
The carefully scripted project, which began July 16, covers stocks, options, corporate and municipal bonds and securities known as unit investment trusts. Although the simulation is no more than a low-volume rehearsal for a much broader trading test next spring, computer experts around the world are scrutinizing the test because it involves 29 brokerage firms, all major stock exchanges and the corporations that clear and process trades for them. The $270 billion securities industry is the first to move beyond individual companies testing their own computers and programs toward testing conditions where computers link many different businesses.
The participants have been looking for signs of electronic foul-ups that could occur if computers or programs running on them fail to recognize that the first days of the year 2000 come after the last days of 1999. The problem is a vestige of the once-common programming technique of using just two digits to refer to the year in dates -- 98 for this year, for example. Many programs do not recognize that 00, for the year 2000, or 01, for 2001, represent valid, later dates than the 99 they see for 1999.
Year 2000 problems can result in inaccurately generated data, faulty calculations and computer shutdowns. In some cases, computers may function normally when confronted with a date in 2000 but fail to restart after being shut down.
The testing is scheduled to continue with a simulation of Jan. 4, 2000, for mutual funds and Jan. 22, 2000, an options expiration date, but the test yesterday was considered the last big question mark by many of the participants in this preliminary round. Not only did it simulate the first day when trades will be entered in the new century, but it also covered the final step of the three-day clearing and settlement process for many trades initiated on the first day of testing.
"People are feeling good," said Leslie Tortora, chief information officer and managing director at Goldman, Sachs & Company. "An enormous amount of energy and preparation has gone into making this successful."
The trading systems tested this month are only some of many that will have to function well for Wall Street to sail smoothly into the new century, including those of businesses outside the industry that supply electricity, telecommunications and other essential services. Ms. Tortora said she hoped one of the benefits of the project would be to encourage a similar effort by telephone companies.
Thursday, July 23, 1998
Copyright 1998 The New York Times |
