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Technology Stocks : Discuss Year 2000 Issues -- Ignore unavailable to you. Want to Upgrade?

To: C.K. Houston who wrote (5841)	5/25/1999 9:46:00 PM
From: C.K. Houston	Read Replies (3) \| Respond to of 9818

CREDIT UNIONS TO ACCESS FED DISCOUNT WINDOW FOR Y2K CASH Dow Jones Newswires WASHINGTON -- Congress and the Federal Reserve are giving credit unions unfettered access to cash in preparation for public paranoia surrounding the Year 2000 computer glitch. The Fed and the National Credit Union Administration announced Tuesday an agreement that gives the credit union industry access to the Fed discount window in the event that the public panics and withdraws huge sums of money from credit unions in the weeks before the turn of the century ... Not expecting Congress to pass something this year, the credit union agency worked out a backup plan with the Fed. But Congress took action last week to allow credit unions to borrow from their own Central Liquidity Facility above its current $600 million cap. The facility will give credit unions access to up to $20.7 billion for one year surrounding Jan. 1, 2000, according to the credit union agency. That means credit unions won't have to rely just on the Fed for their cash needs. The nonprofit lenders will only use the central bank as a last resort, credit union officials said. "Credit unions can rest assured that if there is an unlikely problem in the system, NCUA and the CLF are well prepared to deal with it through these expanded avenues," NCUA Chairman Norman D'Amours said in a statement. The Central Liquidity Facility provides short-term, emergency loans to credit unions. Already, the Red Cross is advising people to withdraw extra money before New Year's Day weekend in case banks can't operate. Some consumer groups are specifically recommending households take out an additional $500 before that weekend. With 15 million households with credit union accounts, that would come out to $7.5 billion. D'Amours said his agency doesn't yet know exactly how much extra cash it will need, estimating the demand at between $2 billion and $20 billion. -By Dawn Kopecki; 202-862-6637; dawn.kopecki@dowjones.com interactive.wsj.com Pretty big increase ... from $600 million to more than $20 billion. Cheryl