This Gallup poll was paid for by the U.S. government's banking regulatory agencies. Link: http://www.fdic.gov/banknews/fils/1999/Y2Ksurveyreport.... (PDF required)
Gary North ( you know, the one with an axe to grind) summarizes the results below. I see the logic of this view. Gary, as well as most y2k realists and the author of this site have been routinely scorned and targeted for "causing a bank run." Those making this assertion vastly over-estimate the exposure and influence we have on the general public at large. There are perhaps only 1 or 2% of the population who have a clue of how serious y2k really is. This is because the vast, VAST majority gets its y2k information NOT from the internet, but television, newspapers, radio and magazines--the mainstream.
As shown below, 47% polled in March 1999 expect bank runs due to y2k, yet only 7% have actually used the internet to get their information on y2k. Of that 7%, perhaps 25% (that's just a guess--probably overstated) have actually read Gary North's site (or sites like this--similar to Gary North) to any degree. Of that 25% of 7% of 47%, perhaps 20% have actually been concerned enough and taken meaningful steps to prepare and withdraw currency from the bank.
After calculating the above numbers I come up with a total of 0.00165 of the population will have withdrawn their cash out of the bank directly due to Gary North, Ed Yourdon or this web site. That is less than a fifth of one percent of the population, or 430,000 of the American population. Now if we consider that anyone under thirty years of age would not have anything meaningful in the bank, (Gen X is very poor) that number drops by probably more than half to 200,000--again, this is still most likely overstated.
Yet, as I repeat, a full 47% of the American population expects their neighbors to withdraw ALL their cash. They heard this from Gary North? No. From the mainstream media. As he points out, if y2k is a self-fulfilling prophecy (which requires the assumption that y2k has been solved or is not serious), then the blame should go to the mainstream media not internet doomsayers.
Indeed, it may be those who suggest "That public panic behavior about Y2K problems is a considerably greater threat to social and economic systems than the actual computer failures" WHO WILL PSYCOLOGICALLY CREATE A SITUATION OF PANIC. (read below to see why.)
After Gary's comments are graphs and charts showing the responses to the poll.
This was March, 1999, before things really get rolling, before the bankers run out of compliance deadlines that are just around the corner, Real Soon Now, before TV clips show a million Japanese housewives standing in lines in front of their banks. Half the U.S. public thought that there will probably be bank runs by December: withdrawal of all of people's money -- not 72-hour weekend party money. I would call this a well-primed audience: 47 million households think their next door neighbors will go down and get 100% of their money out of the banks.
If this statistic does not produce damp shorts in the boardrooms of the New York banks, then the board members are brain-dead. But it gets worse:
"Barely one respondent in five believes that the entire banking system will be forced to shut down by computer problems" (p. 16).
I love that: "barely one respondent in five." Let that one sink in, folks. 20% of Americans say that they think the entire banking system will be shut down in January. Barely? BARELY??? If 20% of the public thinks this in March, we are going to have an interesting Christmas.
The spinmasters have their work cut out for them. I think Koskinen will let this one pass. "It's in Greenspan's end of the court."
The poll was 2,600+ people -- a large poll, at least 1,100 over the industry standard of 1,500, thereby lowering error rates to below 3%. There are about 100 million households in the United States. These 2,600+ represent their opinions statistically.
Important findings on the media: 80% of those polled had heard of y2k, but only half had heard a great deal about it. About 46% had heard something about banking and y2k. (And 47% thought there will be runs -- an interesting correlation that the Gallup folks did not mention.) Of these 46%, 36% got their news from TV, 32% from newspapers, and 7% from the Internet. Thus, the mainstream media have provided two-thirds of the better-informed public that knows about y2k and banking with whatever these people know about the topic. The Internet was not a factor, and newsletters were not on the public's radar. Thus, if bank runs are a self-fulfilling prophecy -- and bad code is nothing crucial -- then the mainstream media should be blamed if the runs happen.
I blame bad code and fractional reserves, but I'm on the Internet. What can you expect?
The public has heard almost nothing about y2k from their banks. This means that the banking industry is dependent on outside information sources for the opinion of its depositors. This is bad news for banks if the media ever discover that y2k bank run stories gain big audiences. (If!!!)
Now, I don't want you to imagine that there was any bias in the Gallup Organization's reporting. I can't imagine that the following use of adjectives in any way reflects bias:
"In addition, survey data suggests that those with more exposure to Y2K issues (more information) are more likely to be planning to take rational and prudent precautions and less likely to be planning to take drastic steps to prepare for Y2K."
Rational and prudent precautions vs. drastic steps: yes, that's certainly neutrality in action.
Most people think the problems will last only briefly. Most people also haven't a clue about fractional reserve banking. If today's scared ones -- 47% -- take all their money out for the weekend -- which is what they think everyone else will be doing -- then the banks will be in bankruptcy by January 1. This is irrespective of foreign bank runs and cascading cross-defaults among banks.
The Gallup authors think the following is good news for banking:
"The first quarter of 1999 saw the publication of more and more frequent feature articles across all media (including mass communications) suggesting that public panic behavior about Y2K problems is a considerably greater threat to social and economic systems than that posed by the possibility that some systems will not be fully remediated by December 31, 1999."
So, the media are telling people that public fear is the big threat. That message will be believed. When the first signs of the bank run mania hits, millions of Americans will take action. "If people are getting scared now, then I'd better get my money out before the banks close." This message -- "the code is OK, but people are the threat" -- is perfect for creating mass panic. It sets up depositors not to pay any attention to the banks' assurances that they are compliant. "Who cares if you're compliant? My next door neighbor has pulled out his money, and I want mine. Give me my money!" These are the four most terrifying works in the bank industry.
This is more good news, Gallup style:
"Eighty-six percent of respondents expect to confirm their account balances before year’s end, with 57 percent indicating they would definitely take this step and only a combined 9 percent indicating that it was unlikely that they would do it. Seventy-eight percent said they will keep better track of bank transactions, with nearly twice as many indicating “definitely” as “probably.” Only 15 percent of depositors felt it unlikely they would take this precaution. Eighty-two percent of respondents expected to continue their usual banking routines at year end – with responses evenly split between those who reported “definite” and “probable” intentions. Fifty-nine percent thought it likely that they would discuss Y2K readiness with bank staff, again with the percentages evenly split with respect to the firmness of intent" (p. 23).
Don't these poll-takers undertand what this means? If 59% of depositors start asking questions, October-December, the banks' phone lines will jam up. That is 59 million heads of households, all calling their bankers or going down to talk with some nicely dressed, poorly paid lady at the bank.
Want to terrify bank depositors? Give them a busy signal. So, they'll go down in person. Fifty-nine million frightened account holders all trying to get straight answers from frantic tellers in the middle of media reports on foreign bank runs. They were already spooked in March. Now they all go down at once to get the facts. You know what's next. "As long as I'm here anyway, give me my money!"
Fifty-nine million people lining up to have a chat with a teller. I would call that an irresistible TV crew opportunity. "Live at 11!" All in time for Christmas. (I can see Alan Greenspan in a Santa suit, sitting at the front of the line, with a bucket of newly printed $100 bills next to him. Depositor after depositor gets to sit on his lap. "Have you been a good little entrepreneur this year? Well, Santa has some preliminary returns for you! Merry Christmas! Ho, ho, ho.")
There will be few ho, ho, ho's in the boardrooms this month.
I suggest that you think through what you are about to read: 47 million Americans think there will be bank runs. They are taking a wait-and-see attitude. But they are spooked, big-time.
Did you see "City Slickers"? Do you remember the scene when Billy Crystal turns on the battery-operated coffee bean grinder? Do you remember what happens next? I suggest that you wake up and smell the coffee. Early.
You're on the Internet. You have a head start. A word to the wise is sufficient.
I loved the lead paragraph of a brief story on this report in the WASHINGTON POST ( June 15). The Beltway spin begins:
A survey sponsored by four federal agencies found that a quarter of the people polled said they had received information on the year 2000 computer glitch from their banks or other financial institutions. Three-quarters, though, believed that their bank would "definitely" or "probably" solve the Y2K problem before year's end.
* * * * * * * * * *
The Gallup Organization (Gallup) conducted telephone interviews with a randomly selected, representative sample of 2,653 non-institutionalized adults aged 18 or older living in households with telephone service in the contiguous continental United States. The field period ran from March 1-14, 1999 (p. 1). . . .
By the first half of March 1999, most Americans were familiar with the computer systems issue known as the “Y2K problem,” the “millennium bug,” or the “century date change problem.” As shown in Figure 1, over 80 percent of US adults reported that they had seen or heard about the issue, and about one-half reported they had heard “a great deal” about it. Only 7 percent of Americans indicated they had heard nothing at all about the Y2K issue or its potential impacts on the American economy and society.
Levels of public awareness have increased somewhat since December 1998, when a national telephone survey conducted by Gallup found that 39 percent of Americans had heard “a great deal” about the Y2K problem and another 40 percent had heard something about it. The percentage of Americans who report seeing or hearing nothing about the issue has been steady at 7 to 8 percent for several months (p. 2). . . .
Although general awareness of the Y2K problem among the general public was relatively high in March 1999 (and very high among some segments), exposure to specific information about the potential impact of Y2K problems on the banking industry was significantly lower. As shown in Figure 2, only 46 percent of U.S. adults reported seeing or hearing anything specifically about the likely effects of Y2K on banking services (p. 4). . . .
Television and newspapers were by far the most commonly cited sources of information about the impact of Y2K problems on the banking industry. Taking account of multiple responses, television was mentioned by 36 percent. Newspapers were the second most commonly mentioned source, named by 32 percent.
Considerably fewer respondents mentioned other types of information sources. Magazines provided information about Y2K and banking for less than half the percentage that mentioned television or newspapers. Family members, friends, and coworkers were mentioned by only 12 percent. Web pages on the Internet were mentioned by only 7 percent of respondents to this item (p. 6). . . .
Exaggerated fears of losing access to funds for a prolonged time period could lead depositors to withdraw substantial funds from banks during the final days of 1999. To encourage prudent behavior, federal financial regulatory agencies recommend that each regulated bank plan and implement a broad consumer awareness program about the bank’s readiness for the century date change. The March 1999 survey attempted to assess how well bank customers are being kept apprised of Y2K readiness by the banks where they keep deposits and obtain other services.
Respondents were asked the general question, “Have you received any information about the Y2K computer problem from your bank?” As shown in Figure 6, only about one-quarter of survey respondents recalled receiving information about Y2K directly from their own banks, a level considerably below what would be expected based on data from banks who have already begun implementing customer awareness communications efforts (p. 8).
General Concerns about the Banking Industry Reasoning that respondents’ actions to protect themselves from the consequences of Y2K banking problems would be driven by both their knowledge of and their levels of concern about the impact of banking service disruptions, the March 1999 survey investigated respondents’ state of concern about the problem on several levels. First, respondents were asked the general question, “Overall, how concerned are you about the Y2K computer issue? Would you say you are very concerned, somewhat concerned, not too concerned, or not at all concerned?”
In general, the U.S. population is evenly divided in their levels of concern. Figure 9 indicates that a total of 51 percent are either “very concerned” (11 percent) or “somewhat concerned” (40 percent), and that 49 percent are either “not too concerned” (32 percent) or “not at all concerned (17 percent).
In addition, survey data suggests that those with more exposure to Y2K issues (more information) are more likely to be planning to take rational and prudent precautions and less likely to be planning to take drastic steps to prepare for Y2K. By providing more of the right kinds of information to depositors, it appears that banks and federal financial regulatory agencies can increase informed decision making, without simultaneously causing higher levels of concern, and, as a consequence, higher rates of more drastic steps to protect access to their money (p. 12).
With respect to public response to Y2K threats, nearly half (47 percent) consider it likely that people will panic and withdraw all their funds prior to year’s end, compared to 37 percent who consider it unlikely (p. 14).
More than 40 percent consider it somewhat likely that ATMs will fail and that people will temporarily lose access to their deposits. Some 38 percent consider it likely that check processing will be affected by Y2K problems, leading some checks to bounce against account balances that are not accurately updated.
Fewer than 30 percent of respondents consider it at least probable that banks will lose track of people’s money, although over half of respondents (52 percent) consider this to be unlikely. Barely one respondent in five believes that the entire banking system will be forced to shut down by computer problems, while 61 percent of the public considers this to be unlikely, and 20 percent are quite certain that it will not happen. Seventeen percent believe it likely that security and control over account access will be compromised by the Y2K problem, but 64 percent of respondents hold the opposite view.
In summary, as has been shown in other surveys, it appears that the public is more inclined to expect particular types of disruption of bank services to occur (ATM problems, temporary inaccessibility of cash accounts), but are not much inclined to expect major problems (the collapse of the entire system, or failure of access security over individual accounts). Moreover, these data, together with statements made by a number of focus group participants, suggest that the public may believe that the most likely cause of banking disruption may be the behavior of depositors who attempt to withdraw all their funds from banks prior to January 1, 2000. This concern may be among the most important public perceptions that may be addressed by a public information campaign during 1999 (p. 16). . . .
Figure 12 shows that half of respondents expected that, if Y2K problems occur, they will last for only a few days at the beginning of the year. An additional 31 percent of respondents indicated their belief that the problems could continue for a few weeks. Only 10 percent of respondents believed that any Y2K problems would extend for several months to a year, and a scant 2 percent responded that the problems would endure for more than one year. (The 5 percent of respondents who did not know how to answer the question are not shown in Figure 15.) At least at their own banks, respondents are not bracing themselves for a long ordeal of disruptions to banking services (p. 18). . . .
As shown in Figure 14, over three-fourths of the sample (76 percent) indicated some level of confidence that their bank would solve the Y2K problem before the end of the year. Over one-third of respondents (35 percent) believe that their banks will definitely meet the deadline for system correction, and an additional 41 percent indicated that it was probable that their bank would finish work in time (p. 20). . . .
Eighty-six percent of respondents expect to confirm their account balances before year’s end, with 57 percent indicating they would definitely take this step and only a combined 9 percent indicating that it was unlikely that they would do it. Seventy-eight percent said they will keep better track of bank transactions, with nearly twice as many indicating “definitely” as “probably.” Only 15 percent of depositors felt it unlikely they would take this precaution. Eighty-two percent of respondents expected to continue their usual banking routines at year end – with responses evenly split between those who reported “definite” and “probable” intentions. Fifty-nine percent thought it likely that they would discuss Y2K readiness with bank staff, again with the percentages evenly split with respect to the firmness of intent (p. 23).
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