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To: Bobby Yellin who wrote (31353)	4/9/1999 12:36:00 AM
From: Alex	Respond to of 116795

Fed ups available cash by $200 bln for Y2K--Moskow By Isabelle Clary NEW YORK, April 8 (Reuters) - The Federal Reserve will provide U.S. banks with an additional $200 billion in cash to cover any surge of year-end withdrawals by customers worried about the year 2000 computer problem, Chicago Fed President Michael Moskow said on Thursday. ''As a precaution, the Fed will increase the currency in circulation and in our vaults to about $700 billion by late 1999,'' Moskow said in text prepared for an economic lecture at Middlebury College, in Middlebury, Vt.. ''The Fed has acted to ensure that more than sufficient cash will be available throughout 1999 and 2000,'' Moskow added. Currency in circulation is the cash Americans carry in their wallets for daily spending and that currently amounts to about $518 billion, according to the latest Fed's data, The additional $200-billion cash will boost the volume of U.S. dollars available for or in circulation to about $700 billion. The Fed also keeps cash in its vaults in the event of a sudden demand for the U.S. currency. The Fed is increasing currency in circulation as the year 2000 nears to avoid panic runs on banks if people fear computer programs will mistake the years 1900 and 2000 -- the ''Y2K'' or ''millennium bug'' problem -- and erase existing balances on their bank accounts. ''I don't know whether people will be wondering whether their ATMs (automated teller machine) will work or not and withdraw a lot of money before December 31,'' said deputy chief economist Carol Stone at Nomura Securities International. ''But it's prudent for the Fed to prepare for this, by making available to banks extra hard cash in case people do feel that way,'' Stone added. ''After all, some people think the world will end on January 1, 2000, and others may think their money will disappear.'' The Fed is the government agency that distributes to commercial banks the dollar notes and coins they need to meet their customers' demand. Moskow stressed the importance for U.S. banks and financial markets to eliminate the millennium bug from their computer programs and said the Fed's own ''most important internal systems are ready for Y2K.'' ''The Federal Reserve has a vast experience in handling disruptions such as national disasters,'' Moskow added while pointing out that the vast majority of U.S. banks and thrifts or 7,600 institutions are also in compliance with the program. biz.yahoo.com