Boxing Day seems not a lucky day in recent years. While the painful experience of Tsunami in 2004 has not been forgotten, this year the world encounter the internet disaster caused by the Taiwan earthquake on 26 Dec.
It was hardly believed that the earthquake could lead to such a serious disruption of communication and business. Even worse, the problem may last for a few days. Many securities firms using Bloomberg for trading had to resume the "manual mode", i.e. filling in deal tickets! Without the real-time updating of positions, the risk of trading and operational errors would be much higher.
Then we must return to the fundamental problem: contingency planning. Since the 911 incident and SARS outbreak, SFC has paid more attention to contingency measures in disastrous events. Under Section 12.5 of the Code of Conduct, licensed firms should notify SFC "any material failure, error or defect in the operation or functioning of its trading, accounting, clearing or settlement systems or equipment". Since this time the problem is so widespread, SFC had already taken the initiative to contact certain large firms to understand the problem.
Once again I would imagine the terrorists can create an economic disaster by attacking the optical fiber cables under the sea...
Best wish for a more peaceful 2007!
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