The thing with the flash crash is this: the market dropped 1K points immediately because the computers and their operators refused to provide liquidity when th

The thing with the flash crash is this: the market dropped 1K points immediately because the computers and their operators refused to provide liquidity when the initial suspicious trades hit the wire. While the event may have been caused by a computer, the extent of the drop was more because computers pulled themselves from the market than because high-frequency trading is somehow financially evil. I think people need to understand that a lot of the high-frequency trading actually helps to stabilize the market. What you saw during the flash crash is what happens when liquidity dries up because the computers are not trading.