Computer trading be damned!

Discussion in 'Economy' started by loosecannon, Oct 1, 2010.

  1. loosecannon
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    loosecannon Senior Member

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    economic weapons of mass destruction?

    The Associated Press: One large trader led to May 6 stock market plunge
     
  2. william the wie
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    william the wie Gold Member

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    Thus the alibis continue. A 1% drop added to an existing 2.5% drop cannot cause a 10% overall drop without a lot of other things happening.
     
  3. Neubarth
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    Neubarth At the Ballpark July 30th

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    The Fact Remains that it is extremely easy for one corrupt banking entity like Goldman Sachs to move the market up or down at will. On light to moderate trading days, Goldman Sachs can move the market up or down by forty points with ease. Almost every body has seen them do it during the last ten minutes of the trading day. It is their "signature" move to let everybody know they are in control.

    I have written Congress for years now, but nobody has the balls to go up against Goldman Sachs. Most of Congress is on the Goldman Sachs tit.
     
  4. Dick Tuck
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    Dick Tuck Board Troll

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    You mean like margin calls, triggering stop lose orders, and triggering other algorithmic trading systems? I suggest you read about the crash of 1987 to see how computer trading can effect the market.
     
    Last edited: Oct 2, 2010
  5. loosecannon
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    loosecannon Senior Member

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    like more auto trade programs responding in kind to a 1000 pt sudden freefall....
     
  6. william the wie
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    william the wie Gold Member

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    Yeah but where did the original 2.5% drop come from? That is 1/6th of average annual range of returns for the stock market and yeah I know about 87. I was hanging with a buddy at Kavanaugh Investing while the crash was happening.
     
  7. Dick Tuck
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    Dick Tuck Board Troll

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    Stop loss orders, margin calls, day traders bailing, short selling into the dive, and triggering of other computer trading systems. The 2.5% annual range means nothing in a daily market. A huge enough trade in a day could easily trade the market down that range, especially if was in a DOW stock. That huge trade might look like chump change on an annual picture, but destroy the short term market.
     
    Last edited: Oct 2, 2010
  8. loosecannon
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    loosecannon Senior Member

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    What I read is that autotrading programs responded to one massive sell order (already posted) and interpreted that data as a cataclysmic event and nobody overrode the trading programs for half an hour while they went crazy because they didn't trust their data and info.

    Within about 90 minutes the crash had almost corrected to within it's intraday range.

    But there may have been huge winners and huge losers some of whom made money each way.

    Computer trading should be illegal anyway, esp since 1/3 of Americans have their pensions riding on stocks via government sponsored programs.
     
  9. loosecannon
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    loosecannon Senior Member

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    That sounds like what the investigation concluded.
     

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