“The conventional wisdom held that an incorrectly typed sell order – one that confused ‘billions’ for ‘millions,’ for example – was the likely culprit,” Mackenzie and Sender report. “‘The trigger for the sell-off was most likely some kind of errant order, a fat-finger typo, which set off a chain reaction of selling,’ said Sang Lee, managing principal at Aite Group. ‘I would be shocked if that was not the case as the fall in stocks was so sudden and extreme.'”
MacDailyNews Take: A typo? Really? Might we be so bold as to wonder why this never happened before? Everyone’s been typing just perfectly for years? Puleeze. And, if true, any system that can fail so spectacularly due to a single typo doesn’t deserve to be called a “system.”
Mackenzie and Sender report, “However, despite the persistence of this story, officials were struggling to idenfity a specific cause. ‘We still don’t know what was the initiating signal for the trading activity we saw on Thursday,’ said Jeff Wecker, chief executive officer at Lime Brokerage. ‘The verdict is still out.'”
“What was clear was the ferocity of the fall. Just before 2.40pm on Thursday, the S&P 500 index, the US equity market’s benchmark, fell from 1,120. Inside six minutes, it bottomed at 1,065.79, a slide of nearly 5 per cent,” Mackenzie and Sender report. “By 3.00pm, the index was moving above 1,120, although still down 4 per cent on the day before, settling 3.2 per cent lower by the close.”
Mackenzie and Sender report, “One government official said the activity reinforced worries that ‘the market has outpaced the ability of the infrastructure to handle it. We have detached finance from the real economy and created a monster.'”
“The Securities and Exchange Commission and the Commodities Futures Trading Commission said they would ‘review the unusual trading,'” Mackenzie and Sender report. “Hearings have been scheduled for Tuesday before the House financial services subcommittee on capital markets.”
Full article here.
MacDailyNews Take: Oh, goodie. Congressional subcommittee hearings are always so productive.
Sounds like we need a new commercial with a stock trader: “Windows7 was my idea.”
Someone wanted all gains this year to be erased….?
Lets see now, politically would anyone benefit from trying to portray things as glum and disastrous? Is this a diversion? Is this a last run at everyones money? Is this the dress rehearsal?
Apple is solid. Know your company.
Not a mystery to me… Bwa ha ha ha ha!
Perhaps the rigid automatic trading systems have had an element of chaos introduced. The market is a dynamic system if ever there was one and the “typo” from yesterday certainly qualifies as one big nasty butterfly. More like fricking mothman.
Whoever he/she was, doubt they were on a Mac.
Obama and his bunch may have mistaken trillions for billions, and didn’t really mean to bail out the planet.
If your going to give your take and speak your mind on the news tell your name half the time you make me sick with the retarted shit you say. That way if you do post who’s giveing there take I can just skip it and not wast my time…..
Imagine the disasterous effect if someone ever accidentally typed “gazillion” instead of “twelve” !
(sarcastic/sardonic comentary on the absurdity of the claim that it was a “typo”- what do they take us for, idiops?)
I don’t know what disturbs me more: the probability that the trade-typo explanation is a lie or the possibility that it’s not.
Stop loss triggers hit in retirement and investment accounts all over the world while hedge funds and investment bankers rushed in to scoop up the spoils.
In the end does it really matter if it was an intentional theft of some large fraction of $1 trillion or an unintentional theft of the same? A huge amount of wealth changed hands that should not have. It might well have been the greatest robbery in the history of the world.
Two predictions: the system will not be changed and this is not the last time this will happen.
This is the biggest BS answer I have ever heard. One mistake sends the DOW down 1000 points. Bulls$&@. Do they want investors scared of their shadow? Because crap like this will erase all of the confidence in the market.
@ Juan,
Actually, Mac and Windows keyboards are rather similar.
It was probably a BlackBerry.
As the manager of the Airline, I’d like to apologize to the families of the victims of that passenger jet that crashed.
You see, the pilot typed a “C” instead of an “F” on his keyboard.
@Brian, “If your going to give your take and speak your mind on the news tell your name half the time you make me sick with the retarted shit you say. That way if you do post who’s giveing there take I can just skip it and not wast my time…..”
When you learn to spell, I will do just that. Just love those retarts!
One word: RoveBush!
Don’t mind Ron. He’s just an astroturfer, paid by the RNC to spread slime. And this is just the beginning of a volcano of spew from his ilk.
If not, then Ron, pray tell what motivates you?
It’s ron BTW. Would like to insult the wrong Ron, now would we?
I’m right also.
SB. Wouldn’t. Love that spelling.
Is it the red chinese? Just give them Greece.
This has happened before. Check the book “Set Phasors on Stun”. It is not sci-fi but about human factors errors caused by design. It was something like an order to sell $100,000 was entered as 100,000 shares which caused a dramatic plunge in the market.
Could it have been a Windows virus toying with the trading system?
no mystery, just someone wanting to make a lot of money the old fashion way: they stole it
ron, you are not just “right”, you are far, fanatically, “right.
The initial “instance” was likely a significant error in sale of one stock by one of the bigger players. Then the automatic robo-traders kicked in, spreading the panic. Then sanity kicked in and shut down the robo-traders.
I guess I should check, but rumor has it that twenty to thirty minutes of trades – across the board – will be negated. “Didn’t happen”. Makes me feel less deprived for having been out shopping when it happened! Would have loved grabbing a “bargain”.
I blame ron.
Summary of MDN’s take:
We have no idea what happened either. We don’t know the first thing about international finance, market makers, or algorithmic trading systems. But what the hell, that won’t stop us from spewing snarky streams of vectorless vitriol with wild abandon.
Go fanboys! Give ’em hell!
Summary of MDN READERS’ comments:
It’s Obama’s Fault™!
Bush would have invaded Wall Street, armed, trained and funded a band of extremist Muslim fanatics*, and taken over control from those Manhattan Fascists. Ah, the good old days.
*Just kidding, that wasn’t the Readers’ comments. They have completely forgotten that their right-wing idol Bush Sr propped up Noriega, Hussein, and bin Laden, trained the death squads in the School of the Americas, and destroyed the Gulf with their drill-baby-drill joe-the-plumber-loving Sarah-Palin-voting pro-big-oil dumbassism. And they never even knew that Prescott Bush made his millions from cashing in Jewish gold while serving on the board of Nazi banks during WWII. I love this site.
Silly little humans, Thursday was just practice.
The sentient botnet serving MDN’s ads has figured out that it doesn’t need SkyNet to destroy humanity, it just has to screw around with the stock market.
Thursday was just practice for Judgment Day, dontcha know?