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I know people in the financial industry, and a HFT "blip" is not the cause of this.

by alttab 17y ago

kyro 17y ago
So what is it then?
- jsm386 17y ago
  per mschwar99 below CNBC: Trading Error at Major Firm Blamed for Market Plunge: Sources (Story Developing)
  - joe-mccann 17y ago
    Honestly, if you don't know that CNBC is to the financial markets as what the Hee Haw is to the news, then I can't help you. CNBC does NOT know what the cause of this was. The exchanges will come out with some "computer glitch" story or the "fat finger" excuse, but neither of those are true. FWIW, the fat finger excuse is, in a nutshell, some trader accidentally pressing the wrong button on the trading desk. The market was at a technical support level with various moving averages, timelines, etc. all coming into play. Many people had/have stop losses because the market was/is looking due for a correction. Algo/HFT pounced on this, collectively, and thus the massive drop. Trust me, if you are buying into what CNBC tells you, you are really missing the truth...
- krschultz 17y ago
  "A possible culprit for the drop was a trader error in which someone entered a "b" for billion instead of an "m" for million in a trade. Multiple sources confirmed the report to CNBC and CNBC.com" http://www.cnbc.com/id/36998463 http://www.cnbc.com/id/36998463 That sounds hard for me to believe, but thats one rumor. That wouldn't account for the 10% drop but it might have put initiated the drop and then caused other people (and computers) to panic and sell.
  - InclinedPlane 17y ago
    Considering that the volume on Proctor & Gamble trading today not only does not include a spike of a billion shares sold but does not look different from relatively recent trading days, I'd chalk this one up to just a rumor and nothing else.
    - fauigerzigerk 17y ago
      Today's chart does show a spike down to $50 or so, maybe even lower. Go to finance.google.com and look at the intraday chart. It also shows a volume spike, but curiously that's later. [Edit] Actually the stock was down at $39.37 from $61. On normal days PG barely moves at all.
      - mbrubeck 17y ago
        There's undoubtedly a price spike. But to confirm or deny the s/million/billion/ explanation we are looking for a volume spike at the same time.
        fauigerzigerk 17y ago
        Don't forget all the derivatives linked to the price. You don't see that volume or the losses caused by that.
      - rdtsc 17y ago
        It depend on the resolution of the chart. If the resolution is minute-based, then it could have hit $0 then come back up to $39 within a minute. You wouldn't know. You'd have to have a special high-resolution stock feed.
        fauigerzigerk 17y ago
        Yes, but I would expect that the low and high for the day shown on the finance websites does show everything down to tick level. Not real time of course.
- gorm 17y ago
  DON'T PANIC
- Keyframe 17y ago
  Of course HFT is not the root cause, it might have burned the fuel(stops) when acceleration approached terminal speed. However last tuesday and even before that VIX was on record heights and it pushed even higher today. No fat fingers then. Market is trying to tell us something, obviously. Cumulation was there, this was just a first in a series of explosions triggered by one reason or the other (greece/eu/trichet inaction today).
joe-mccann 17y ago
I never said anything about a "blip" and it is far from it. The equities markets are easy to manipulate; all you need is more $$ than the other guy and if all your friends are on board, that's a lot of $$ to move the market in the direction of your favor. One of the reasons the forex markets are MUCH more difficult to manipulate is that you have $3.5 trillion traded daily. Not sure who can simply move that market. Equities on the other hand, much easier....

I know people in the financial industry, and a HFT "blip" is not the cause of this.

by alttab 17y ago

I know people in the financial industry, and a HFT "blip" is not the cause of this.

kyro 17y ago

So what is it then?

jsm386 17y ago
per mschwar99 below CNBC: Trading Error at Major Firm Blamed for Market Plunge: Sources (Story Developing)
- joe-mccann 17y ago
  Honestly, if you don't know that CNBC is to the financial markets as what the Hee Haw is to the news, then I can't help you. CNBC does NOT know what the cause of this was. The exchanges will come out with some "computer glitch" story or the "fat finger" excuse, but neither of those are true. FWIW, the fat finger excuse is, in a nutshell, some trader accidentally pressing the wrong button on the trading desk. The market was at a technical support level with various moving averages, timelines, etc. all coming into play. Many people had/have stop losses because the market was/is looking due for a correction. Algo/HFT pounced on this, collectively, and thus the massive drop. Trust me, if you are buying into what CNBC tells you, you are really missing the truth...
krschultz 17y ago
"A possible culprit for the drop was a trader error in which someone entered a "b" for billion instead of an "m" for million in a trade. Multiple sources confirmed the report to CNBC and CNBC.com" http://www.cnbc.com/id/36998463 http://www.cnbc.com/id/36998463 That sounds hard for me to believe, but thats one rumor. That wouldn't account for the 10% drop but it might have put initiated the drop and then caused other people (and computers) to panic and sell.
- InclinedPlane 17y ago
  Considering that the volume on Proctor & Gamble trading today not only does not include a spike of a billion shares sold but does not look different from relatively recent trading days, I'd chalk this one up to just a rumor and nothing else.
  - fauigerzigerk 17y ago
    Today's chart does show a spike down to $50 or so, maybe even lower. Go to finance.google.com and look at the intraday chart. It also shows a volume spike, but curiously that's later. [Edit] Actually the stock was down at $39.37 from $61. On normal days PG barely moves at all.
    - mbrubeck 17y ago
      There's undoubtedly a price spike. But to confirm or deny the s/million/billion/ explanation we are looking for a volume spike at the same time.
      - fauigerzigerk 17y ago
        Don't forget all the derivatives linked to the price. You don't see that volume or the losses caused by that.
    - rdtsc 17y ago
      It depend on the resolution of the chart. If the resolution is minute-based, then it could have hit $0 then come back up to $39 within a minute. You wouldn't know. You'd have to have a special high-resolution stock feed.
      - fauigerzigerk 17y ago
        Yes, but I would expect that the low and high for the day shown on the finance websites does show everything down to tick level. Not real time of course.
gorm 17y ago
DON'T PANIC
Keyframe 17y ago
Of course HFT is not the root cause, it might have burned the fuel(stops) when acceleration approached terminal speed. However last tuesday and even before that VIX was on record heights and it pushed even higher today. No fat fingers then. Market is trying to tell us something, obviously. Cumulation was there, this was just a first in a series of explosions triggered by one reason or the other (greece/eu/trichet inaction today).

joe-mccann 17y ago

I never said anything about a "blip" and it is far from it. The equities markets are easy to manipulate; all you need is more $$ than the other guy and if all your friends are on board, that's a lot of $$ to move the market in the direction of your favor. One of the reasons the forex markets are MUCH more difficult to manipulate is that you have $3.5 trillion traded daily. Not sure who can simply move that market. Equities on the other hand, much easier....