A rend in the equity money continuum…

It was a sleepy afternoon here in Cali until I glanced at the Google News headlines and saw what appeared to be signs of sudden freefall in key equity markets — and some pretty amazing futures activity, not surprisingly.

The post-morta are flying back and forth, worries about the Greek bail-out, spiraling international debt, the tendency for computerized “algorithmic” trading nodes to act like a covey of quail with a rock thrown in their midst… but one item that stood out starkly was what should have been a wee typo from a trader who was trying to put in an order for 19 odd million bucks worth of futures but slipped three extra zeros in, putting in an order for 19 billion worth of what were, in essence, bets against the future of the target company.

Other traders — and their cybernetic robo-trading sidekicks — apparently figured that the presumably newly jobless trader must have known something they didn’t know and the rest is Chicken Little and the “wisdom of the crowd” crushing each other in a rush to sell, sell, sell that would make a South American soccer riot look tame.


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