Fortunately, economic reality is usually much less exciting than hot media stories. The economy should be able to withstand the next disaster du jour, the Y2K bug. Let's put this into perspective. So Y2K conversion works out at less than half a cent for each dollar of income, a sizable but not dramatic amount. An intuitive way to think about the economic effects of the Y2K problem is to compare it to a natural disaster.
Earthquakes destroy bridges.
Y2K destroys computer systems and, therefore, hurts productivity, with all the expenses being incurred to maintain current productive capacity rather than augment it. Some companies will try to pass the conversion costs to consumers, in the form of higher prices. Those who lack pricing power will see their profits drop as a result. The overall effect will be inflationary, not deflationary. After all, the bug is likely to spawn employment, not destroy it.