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(BusinessWeek)   New tougher, stronger, more competent SEC still has no idea what caused the "Flash Crash" in May. Invest with confidence   (businessweek.com) divider line 29
    More: Fail, U.S. Securities and Exchange Commission, Commodity Futures Trading Commission, circuit breakers, Full Sail University, pay per clicks, mutual funds, online degrees, volatility  
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693 clicks; posted to Business » on 02 Sep 2010 at 5:45 PM (3 years ago)   |  Favorite    |   share:  Share on Twitter share via Email Share on Facebook   more»



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Archived thread
 
2010-09-02 03:22:00 PM
Regulators: People who enrich the political entrepnures while working to cripple the market entrepreneurs.

Bernanke: "There is no housing bubble." "Lending standards are better than ever." etc.

www.dodoskido.com

/Governments create central banks, union security, and regulators to enrich their supporters. Not to protect the consumer.
//Interesting to watch this reverse Darwinism.
 
2010-09-02 03:52:02 PM
Without seeing everyone's computer transactions there's no way to no what caused the Flash Crash. And good luck getting everyone to turn over their computer records, since it would mean showing the world how their systems are set up.
 
2010-09-02 04:05:14 PM
That's what happens when you play weak OoC teams. The Borsa Italiana? The SIX Swiss Exchange? Creampuffs. Play against the Tōshō or Euronext at their home fields and then we'll talk about superiority.
 
2010-09-02 05:18:25 PM
WhyteRaven74: Without seeing everyone's computer transactions there's no way to no what caused the Flash Crash. And good luck getting everyone to turn over their computer records, since it would mean showing the world how their systems are set up.

" examining whether high-speed traders helped trigger a 700-point drop in the Dow Jones Industrial Average on May 6 by repeatedly placing and immediately canceling orders in an attempt to manipulate share prices"

so you are saying that those orders didnt get to the NYSE? how could they have influenced the price without acutally leaving the traders computer? are you saying that the NYSE doesnt track every trade and cant find out where those trade originated from?
LOL

the NYSE knows exactly where those trades came from and the SEC is trying to figure out WTF to do now.
one option would be to put the traders/owners of the trading accounts/firms in jail until they decide what to do.
call them eco-terrorists and hold them without trial/charges/lawyers under the patriot act.

surrrrrrrrrrrrrrre it wasnt against the law (which it might have been) but so what ... we arent charging them for what they did, we are charging them for being terrorists.

/bwhahahahahahaah imagine the look on their faces.
/hell, I think they MIGHT actually be funding terrorists. lockem up!!
 
2010-09-02 05:29:20 PM
I don't know what it is, but it just asked me to play a game of chess.
 
2010-09-02 05:31:47 PM
New tougher, stronger, more competent SEC still has no idea what caused the "Flash Crash" in May.

I have a hunch that Ray Stevens was behind this.
 
2010-09-02 05:33:07 PM
Hmm.could it possibly be a mix of consumer thriftiness, overreactivity in the markets, and running like a bunch of sheep from the wolf that is hard times?
 
2010-09-02 05:38:31 PM
Somaticasual: Hmm.could it possibly be a mix of consumer thriftiness, overreactivity in the markets, and running like a bunch of sheep from the wolf that is hard times?

whoops. forgot to add "no confidence in the markets"..
 
2010-09-02 05:54:08 PM
Somaticasual: Hmm.could it possibly be a mix of consumer thriftiness, overreactivity in the markets, and running like a bunch of sheep from the wolf that is hard times?

you mean a run on the market?

Who woulda thunk!?

/Bonus points for the Do Over!
//wrong ppl lost money, so we're giving it back. Sorry pleb!
 
2010-09-02 05:55:27 PM
What an SEC "Flash Crash" might look like

www.frumpzilla.com
 
2010-09-02 06:33:11 PM
I don't know what caused it but I'll bet goldman sachs had something to do with it.
 
2010-09-02 06:40:47 PM
"Andrei Kirilenko, a senior financial economist at the Commodity Futures Trading Commission, said July 14 his agency is taking Nanex's research "very, very seriously.""

t2.gstatic.com

Don't mess with the AK-47
 
2010-09-02 06:48:12 PM
I blame Nick Saban
 
2010-09-02 07:00:10 PM
Meanwhile in the bond, futures, and foreign currency markets, ALL trades were upheld during the flash crash.

But of course, every stock broker will tell you that the futures and forex markets are "risky".

Seems to me the market that has 30-minute 12% drops and then cancels legitimate trades without an accurate explanation (4 months later) is the risky market.
 
2010-09-02 07:08:07 PM
berniex: Meanwhile in the bond, futures, and foreign currency markets, ALL trades were upheld during the flash crash.

But of course, every stock broker will tell you that the futures and forex markets are "risky".

Seems to me the market that has 30-minute 12% drops and then cancels legitimate trades without an accurate explanation (4 months later) is the risky market.


You can also add in the fact that if a company gets in trouble, the stock is wiped out and the bond holders get paid. the futures contracts still get delivered. Another, stocks are the hot potato senario.
 
2010-09-02 07:27:25 PM
Did the new SEC get boats?
 
2010-09-02 07:40:40 PM
Crosshair: /Governments create ...union security...to enrich their supporters.

You should wait until you are done high school, and get involved with a union. Then you will discover what unions are about. they are normally anti-government, or at least governments are normally anti-union. Political parties that are struggling, normally 3rd parties, cater to unions because unions have fantastic networks for mobilizing people at the polls. However unions are constantly using that power to fight governments.
 
2010-09-02 08:05:20 PM
Here's the thing....

If someone had actually thought through a plan in which they were able to manipulate the *entire* market, don't you think they would have made sure to cover their tracks well enough as to not get caught?
 
2010-09-02 08:45:28 PM
Quote stuffing.
 
2010-09-02 11:24:13 PM
Invest with your eyes open. Read the fine print. Past performance is no guarantee of future results and all the rest of it.
 
2010-09-03 08:24:23 AM
Soros probably made a lot of money that day. If you don't believe this was orchestrated, than you deserve the 'hope and change' coming to this country in the next decade.
 
2010-09-03 08:27:52 AM
Crosshair: Regulators: People who enrich the political entrepnures while working to cripple the market entrepreneurs.

/Governments create central banks, union security, and regulators to enrich their supporters. Not to protect the consumer.
//Interesting to watch this reverse Darwinism.


Right: because in the 18th and 19th century, laissez faire capitalism, unencumbered by unions, anti-trust laws, or any type of regulation gave us a society where consumers were completely protected, banks were totally stable, and life was some much better for the average American than it is now...
 
2010-09-03 09:23:20 AM
Ya, this crosshair guy is an idiot.
 
2010-09-03 09:50:05 AM
I'd like to know why Flash crashes all the time too.

/wait, what tab was this again?
//oh shiiiii-
 
2010-09-03 10:13:56 AM
dforkus: Right: because in the 18th and 19th century, laissez faire capitalism, unencumbered by unions, anti-trust laws, or any type of regulation gave us a society where consumers were completely protected, banks were totally stable, and life was some much better for the average American than it is now...

Such little history and economic knowledge you have.

People endured a low standard of living in the 19th century because the economy was not sufficiently industrialized. Production per person was much lower than it is today, thus the standard of living was lower. They also lacked the technological advances we take for granted today.

Compared to the past, people in the latter 19th century in the US were enjoying a quite high standard of living. The work day was reduced from the 12-15 hours one had to work on a farm, to 10 hours in the factories, and then finally to 8 hours. As workers became more wealthy they could afford to work less and have more leisure time. Thanks to capitalism, for the first time in history, we see child labor be phased out. The parents could earn enough so that their children did not have to work.

Child labor persists in many parts of the world today for that reason. The society is so under-capitalized and productivity per worker is so low that the children either work or starve. That has been the case for all of human history except for very recently.

Unions, by 1900, represented a whopping 3% of workers. Workers earned more because capital equipment made them more productive. Someone cutting down trees is much more productive with a chainsaw than he is with an Ax. Thus that worker can be paid more, but only because of the capital equipment, the chainsaw. If the chainsaw were removed, the workers wage would have to fall because of reduced productivity.

Unions did nothing to increase workers pay on a whole. All Unions do is make society poorer because by raising the wages of some above the market rate, they lower wages for everyone else because of the lower demand for labor and more workers competing for the remaining jobs. Workers in Europe were far more heavily unionized, yet it was in the US with little unionisism where you saw wages rising the fastest. Workers in the US got the 8 hour day far sooner than workers in Europe.

Workers by themselves do not suffer from a lack of bargaining power. If 3 firms are looking for workers, the individual worker has quite strong bargaining power. If one wants to pay $9 an hour, the workers will go to the company that pays $12 an hour. Henry Ford did more to improve the lives of workers than any Union because it gave workers more options for employment by making them more mobile and thus gave them more options for employment.

You will note that Anti-Trust suits are never brought on by consumers, they are brought on by competitors who cannot compete and wish to cripple their more efficient competitor. Standard Oil took Kerosene from one dollar a gallon to ten cents a gallon. What consumer would not like that? Such legislation is incredibly vague and meant to cripple successful market entrepreneurs to preserve political entrepreneurs. When you go look at the numbers, the supposed "monopolies" were the companies that were increasing their production the most and where prices were falling the fastest.

Bank stability was an issue in the 19th century precisely because of regulations in place by government. Branch banking was outlawed in most states. A run on one bank would easily cause it to fail. With branch banking one branch that had a run could rely on other branches to see it through. In Canada, where branch banking was allowed and flourished, banks were stable and few, if any bank failures occurred. The gold standard put an upper limit on the amount of inflation that banks were able to create.

As productivity rose, prices fell. While your dollar wage may have increased very little, as would be the largely the case under a gold standard, your purchasing power rose dramatically as prices for consumer goods fell.

The WORST Panic during the 19th century was the Panic of 1893. That one saw an average of 12% unemployment for about 5 years, including underemployed workers. So the "unstable" 19th century really was not that bad, especially when compared with the 20th century. The only reason for the lower standard of living was a society that was still industrializing and with a low production per capita.

As for environmental regulation. That was a problem created by government because it refused to enforce private property rights. In the early 19th century, if someone put their wash out to dry and soot from a nearby factory came over and made the laundry dirty they would sue for, and be awarded, damages and get an injunction issued against the offending party. The smoke was considered to be trespassing on that person property. If sparks from a train set a farmers stacks of hay on fire, the farmer would be awarded damages. Again, the sparks were considered to be trespassers onto the farmers property. Thus industry had an incentive to watch themselves because nearby property owners would sue and they would have to pay damages.

As the century went on, the US government wanted to be an empire like Britain. You do that by industrializing. So the government stopped enforcing private property rights under the guise of "the common good". Thus industry had no incentive to watch themselves because the courts would no longer award damages against them. Any industry that did want to be a good environmental steward found themselves at a competitive disadvantage and forced into bankruptcy.
 
2010-09-03 02:12:18 PM
Well, the market is efficient, so stock prices always represent the true value of a company.

Therefore, the explanation is simple. All of the companies involved lost a shiatload of value, very quickly, and simultaneously. Then they gained most of it back over the next few hours.

If that's not the correct explanation, then the market was not efficient. Since market inefficiencies can only arise from government intervention, government intervention MUST have been the cause, in that case.
 
2010-09-03 02:15:26 PM
Crosshair: As for environmental regulation. That was a problem created by government because it refused to enforce private property rights. In the early 19th century, if someone put their wash out to dry and soot from a nearby factory came over and made the laundry dirty they would sue for, and be awarded, damages and get an injunction issued against the offending party. The smoke was considered to be trespassing on that person property. If sparks from a train set a farmers stacks of hay on fire, the farmer would be awarded damages. Again, the sparks were considered to be trespassers onto the farmers property. Thus industry had an incentive to watch themselves because nearby property owners would sue and they would have to pay damages.

As the century went on, the US government wanted to be an empire like Britain. You do that by industrializing. So the government stopped enforcing private property rights under the guise of "the common good". Thus industry had no incentive to watch themselves because the courts would no longer award damages against them. Any industry that did want to be a good environmental steward found themselves at a competitive disadvantage and forced into bankruptcy.


Individuals were able to regulate pollution via private lawsuits, better than the government could, during the Gilded Age?

I think we've found Karl Rove's Fark handle.
 
2010-09-03 02:33:04 PM
Gaseous Anomaly: Individuals were able to regulate pollution via private lawsuits, better than the government could, during the Gilded Age?

Yes. That's my point my point and you're missing it so spectacularly. Government DIDN'T regulate pollution in the 19th century and didn't allow property owners to either in the latter part of 19th century in the name of "the common good". Please show me the stringent environmental regulations in place during that time?

Thanks to government we got this in the US and in Europe for decades. That's quite some "common good" we have there.

www.theglasgowstory.com

www.350resources.org.uk

Government created the problem and then blames it on the market when it comes time to fix the problem. The primary role of government is to protect private property rights, yet it failed miserably at that for large portions of our history. Then it acts all innocent.
 
2010-09-03 03:01:57 PM
Crosshair: Gaseous Anomaly: Individuals were able to regulate pollution via private lawsuits, better than the government could, during the Gilded Age?

Yes. That's my point my point and you're missing it so spectacularly. Government DIDN'T regulate pollution in the 19th century and didn't allow property owners to either in the latter part of 19th century in the name of "the common good". Please show me the stringent environmental regulations in place during that time?


I believe your point that there weren't any good regulations. I have more trouble with the assertion that private lawsuits could have made a difference.
 
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