LJ
Posts: 16,351
May 6, 2010 5:22pm
http://online.wsj.com/article/SB10001424052748704370704575227754131412596.html?mod=WSJ_hpp_LEADNewsCollection
More proof that something fucked up went on
http://blogs.wsj.com/marketbeat/2010/05/06/accenture-went-to-a-penny-at-248-pm/?mod=e2tw
At its afternoon low the Dow Jones Industrial Average was down almost 1,000 points, hurt by sharp drops in Procter & Gamble, 3M and other companies that traders said were subject to heavy selling by so-called black boxes, or automated trading systems.
So someone made an errant trade, the rumor being putting in a sell order for 1,000,000,000 shares rather than 1,000,000, then having the automated trading computers kick in and start liquidating shares of other stocks. Something seriously fucked up happened on wall street today. When are there going to be regulations on the automated trading? We have seen them manipulate the market before. Now, I am all for hedge funds and everything, but that is because there is an actual art to it when it is run by actual portfolio managers doing their due diligence and making plays that carry human emotion. When you get these computers that can make plays faster than a human can, you get things like this.Shares of Procter & Gamble plunged to $39.37 from around $60. The New York Stock Exchange said each stock has its own circuit breaker level. When these stocks fall below their levels, then they can be traded on any other exchange or platform at any price. When P&G fell below its circuit breaker, a bid came in for the stock at $39.37 from the Nasdaq, the NYSE said.
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"You don't see a blue-chip stock like this go down 20 points with no news," said Frank Ingarra, co-portfolio manager at Hennessy Funds, a quantitative firm that deals with program traders. "All of the algorithms kicked in from this errant thing."
More proof that something fucked up went on
http://blogs.wsj.com/marketbeat/2010/05/06/accenture-went-to-a-penny-at-248-pm/?mod=e2tw
You think the action in Procter & Gamble was weird, check out the nosedive on Accenture, which plummeted from above $40 at 2:47 p.m. to $0.01 at 2:48 p.m. Had demand for consulting services declined so sharply in that one minute?
LJ
Posts: 16,351
May 6, 2010 5:25pm
Sorry, the fund meant to sell "$16 million" worth and typed "$16 billion" worth instead.
Regardless, pundits are now out saying "but the market STILL crashed". I'm sorry, but while 350 points is bad, it's not quite the fear mandate that 1,000+ is.
Regardless, pundits are now out saying "but the market STILL crashed". I'm sorry, but while 350 points is bad, it's not quite the fear mandate that 1,000+ is.
I
I Wear Pants
Posts: 16,223
May 6, 2010 5:26pm
Computers should not be allowed to make investment decisions.
ptown_trojans_1
Posts: 7,632
May 6, 2010 5:26pm
I'm no expert on the stock market, but the fact that little error like this caused so much confusion and panic is a little unsettling to me.
LJ
Posts: 16,351
May 6, 2010 5:27pm
I agree to a point. I mean, a lot of the selling would be automatic stops put into place and margin calls, which I feel SHOULD and CAN be computerized, but when they are merely running algorithms, that's pretty messed up.I Wear Pants wrote: Computers should not be allowed to make investment decisions.
derek bomar
Posts: 3,722
May 6, 2010 5:29pm
would have liked to have gotten accenture at $0.01
LJ
Posts: 16,351
May 6, 2010 5:30pm
How many people are getting home to see that their TD account stopped them out of a bunch of stocks that were caught in this "flash dance"derek bomar wrote: would have liked to have gotten accenture at $0.01
derek bomar
Posts: 3,722
May 6, 2010 5:40pm
I'd Hulk Smash my comp if I saw thatLJ wrote:How many people are getting home to see that their TD account stopped them out of a bunch of stocks that were caught in this "flash dance"derek bomar wrote: would have liked to have gotten accenture at $0.01
majorspark
Posts: 5,122
May 6, 2010 5:42pm
It was funny watching the commentators on CNBC confused over this.
I
I Wear Pants
Posts: 16,223
May 6, 2010 5:48pm
Well yeah but the stops and margin calls originated from a person. Like, I say sell it when it gets below 5 bucks. The computer does that. I'm cool with that.LJ wrote:I agree to a point. I mean, a lot of the selling would be automatic stops put into place and margin calls, which I feel SHOULD and CAN be computerized, but when they are merely running algorithms, that's pretty messed up.I Wear Pants wrote: Computers should not be allowed to make investment decisions.
I'm not okay with algorithm based trading that makes many many trades a day.
believer
Posts: 8,153
May 6, 2010 6:34pm
Agreed. I just checked my 401K and took a big hit today over this dumb ass mistake. WTF? :-/ptown_trojans_1 wrote: I'm no expert on the stock market, but the fact that little error like this caused so much confusion and panic is a little unsettling to me.
goosebumps
Posts: 1,058
May 6, 2010 6:50pm
I think its fair to say that this would have been much worse were it not for the stimulus bill 
LJ
Posts: 16,351
May 6, 2010 6:53pm
Your 401k took a big hit for other, actual, reasons. If you lost some shares because of the flash, then I would agree, but the flash was nothing but a blip intraday.believer wrote:Agreed. I just checked my 401K and took a big hit today over this dumb ass mistake. WTF? :-/ptown_trojans_1 wrote: I'm no expert on the stock market, but the fact that little error like this caused so much confusion and panic is a little unsettling to me.
IggyPride00
Posts: 6,482
May 6, 2010 7:07pm
This is the free market at work. High frequency trading is not a regulated activity, and is free for all to do. If people lose money because of it they should stay out of the market. 
J
jmog
Posts: 6,567
May 6, 2010 7:14pm
I'm sure somehow this is Bush's fault, we should as Obama and see what he thinks .
.
LJ
Posts: 16,351
May 6, 2010 7:16pm
I don't call being able to manipulate the market being "the free market at work". Most extreme free marketers I know are very against HFT.IggyPride00 wrote: This is the free market at work. High frequency trading is not a regulated activity, and is free for all to do. If people lose money because of it they should stay out of the market.
That is unless of course you are just being factious
IggyPride00
Posts: 6,482
May 6, 2010 7:27pm
I was being facetious, yes. Many of the HFT guys are also "get the government out of my business and leave me alone" guys as well. You will pry the ability to do that from their cold dead hands.LJ wrote:I don't call being able to manipulate the market being "the free market at work". Most extreme free marketers I know are very against HFT.IggyPride00 wrote: This is the free market at work. High frequency trading is not a regulated activity, and is free for all to do. If people lose money because of it they should stay out of the market.
That is unless of course you are just being factious
An easy way to tremendously cut down on it is a transaction tax, but that would never fly because we would hear from all the usual suspects about how all the trading will leave the U.S, and it will kill investors, and so on and so forth.
LJ
Posts: 16,351
May 6, 2010 7:34pm
wtf firefox autocorrect, lol.IggyPride00 wrote:I was being facetious, yes.LJ wrote: factious
I
I Wear Pants
Posts: 16,223
May 6, 2010 8:57pm
The free market at work...always fucking everyone over.IggyPride00 wrote: This is the free market at work. High frequency trading is not a regulated activity, and is free for all to do. If people lose money because of it they should stay out of the market.
IggyPride00
Posts: 6,482
May 6, 2010 10:06pm
Well, the banking sector got its $300 millions worth today from its lobyying efforts as the vote to break up the big banks failed in the Senate 33-61. We deserve every banking crisis we get from now on (and there will be more to come) as we have had a chance to do something about it and took a pass.
LJ
Posts: 16,351
May 6, 2010 11:56pm
A bunch of trades from today are being canceled.
F
Footwedge
Posts: 9,265
May 6, 2010 11:57pm
+ a bunch. And those that think that another crises will be magically averted here live in a dream world.IggyPride00 wrote: Well, the banking sector got its $300 millions worth today from its lobyying efforts as the vote to break up the big banks failed in the Senate 33-61. We deserve every banking crisis we get from now on (and there will be more to come) as we have had a chance to do something about it and took a pass.
As I posted above, the financial volatility in Greece is no different than the US's financial walk on egg shells. The IMF has given the US a free pass on the deficit spending craze we've been seeing since September of 08.
Denninger shares the truth in the bottom third of his piece written today.
http://market-ticker.denninger.net/
LJ
Posts: 16,351
May 6, 2010 11:59pm
Denninger is usually completely full of crap, but I agree with a good part of his last post today.Footwedge wrote:+ a bunch. And those that think that another crises will be magically averted here live in a dream world.IggyPride00 wrote: Well, the banking sector got its $300 millions worth today from its lobyying efforts as the vote to break up the big banks failed in the Senate 33-61. We deserve every banking crisis we get from now on (and there will be more to come) as we have had a chance to do something about it and took a pass.
As I posted above, the financial volatility in Greece is no different than the US's financial walk on egg shells. The IMF has given the US a free pass on the deficit spending craze we've been seeing since September of 08.
Denninger shares the truth in the bottom third of his piece written today.
http://market-ticker.denninger.net/
fish82
Posts: 4,111
May 7, 2010 8:13am
A buddy of mine stocked up on P&G @ 39. Bastard.derek bomar wrote: would have liked to have gotten accenture at $0.01
sleeper
Posts: 27,879
May 7, 2010 5:43pm
From my understanding, any trade made from 2:40p to 3p are being canceled, so he won't get to hold those shares.fish82 wrote:A buddy of mine stocked up on P&G @ 39. Bastard.derek bomar wrote: would have liked to have gotten accenture at $0.01