Posted on 05/11/2010 8:42:00 AM PDT by conservativefunhouse
Are we really supposed to believe that “fat fingers” are what caused the stock market to crash last week? And, what is Obama going to do about it...
(Excerpt) Read more at conservativefunhouse.com ...
M and B aren’t near each other on any regular keyboard I know. On a regular keyboard N is in between. Is there some other kind of tool they use for trading where they are next to each other? It is the only way anything like this makes sense.
If Obama finds medical or scientific evidence that Fatfingers caused the problem. Think of the disaster that could happen to him if Michelle ever has to help him with hemorrhoid ointment.
The “Fat Finger” was just a rumor that the MSM ran with. The actual cause has not yet been determined.
It is now well known to anyone familiar with Wall Street that the problem last Thursday was the halting of trading on the NYSE (where under half of stocks are now being traded) in conjunction with continuing trading stocks on other venues.
This disparity led to a very rapid and huge mismatch of buy and sell orders, and linked computers interpreting “no stock for sale” as a price for many stocks to be very low - in some cases Zero Cents. They then engineered buys for one cent above these very low prices.
When these automated trading systems are making literally tens of thousands of trades a second, it doesn’t take long for things to go crazy as they did on Thursday. Trades that occurred between 2:40 and 3:00 in 296 stocks have been summarily cancelled. More probably should be, but they put the “cut off” at stocks which had changes of more than 60% of their value.
The several trading venues are going to try to fix this by coordinating trading halts. I do not think this fix will prove sufficient.
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