What caused today's stock plunge? A trader typed "billion" instead of "million".
26 replies, posted
[url]http://www.cnbc.com/id/36999483[/url]
[release]In one of the most dizzying half-hours in stock market history, the Dow plunged nearly 1,000 points before paring those losses—all apparently due to a trader error.
According to multiple sources, a trader entered a "b" for billion instead of an "m" for million in a trade possibly involving Procter & Gamble , a component in the Dow.
Sources tell CNBC the erroneous trade may have been made at Citigroup.
"We, along with the rest of the financial industry, are investigating to find the source of today's market volatility," Citigroup said in a statement. "At this point we have no evidence that Citi was involved in any erroneous transaction."
According to a person familiar with the probe, one focus is on futures contracts tied to the Standard & Poor’s 500 stock index, known as E-mini S&P 500 futures, and in particular a two-minute window in which 16 billion of the futures were sold.
Citigroup’s total E-mini volume for the entire day was only 9 billion, suggesting that the origin of the trades was elsewhere, according to someone close to Citigroup’s own probe of the situation. The E-minis trade on the CME.
A CME spokesman said it found no problems with its systems.
The Nasdaq and New York Stock Exchange took the unusual step of declaring that they would cancel some trades that took place during the height of the selloff. Both markets said they will cancel all trades more than 60 percent above or below market that occurred between 2:40 p.m. and 3:00 p.m. New York time.
Other market sources said the erroneous trading involved the IWD exchange-traded fund or the S&P 500 Mini, according to Reuters. A person close to BlackRock, which manages the IWD, said there was no unusual trading in the iShares product.
Amid the sell-off, Procter & Gamble shares plummeted nearly 37 percent to $39.37 at 2:47 p.m. EDT, prompting the company to investigate whether any erroneous trades had occurred.
The shares are listed on the New York Stock Exchange, but the significantly lower share price was recorded on a different electronic trading venue.
"We don't know what caused it," said Procter & Gamble spokeswoman Jennifer Chelune. "We know that that was an electronic trade...and we're looking into it with Nasdaq and the other major electronic exchanges."
A different P&G spokesman had said earlier the company contacted the Securities and Exchange Commission, but Chelune said that he spoke in error.
One NYSE employee leaving the Big Board's headquarters in lower Manhattan said the P&G share plunge lay at the center of whatever happened.
"I'll give you a tip," the employee said, speaking on condition of anonymity. "P&G. Check out the low sale of the day. Something screwed up with the system. It traded down $30 at one point."
Nasdaq said it was working with other major markets to review the market activity that occurred between 2:00 p.m. and 3:00 p.m., when the market plunge happened.
The exchange later said it was investigating potentially erroneous transactions involving multiple securities executed between 2:40 and 3:00 p.m.
Nasdaq also said participants should review their trading activity for potentially erroneous trades.
The massive selloff, which began shortly after 2 p.m. ET, amplified concerns about the spreading European debt crisis as the approval of austerity measures by the Greek Parliament sparked renewed rioting in Athens.
"There is simply a growing recognition that Greece has got to default," banking analyst Dick Bove told CNBC.com. "The riots in the streets showed the decision to repay the debt was not going to be made by the people in Germany, France and Switzerland—it's going to be made by people in Greece and they're not going to repay it."
There also is a growing sense that any collapse of Greece could trigger a wave of defaults across Europe and even the world.
"We've seen a crisis start in a country—Greece—become regional, impact the whole of the Euro zone and is on the verge of truly going global," El-Erian, CEO of the world's biggest bond fund, told CNBC shortly before the selloff began.[/release]
These fucking guys.
Replace m with b, economy plummets.
Chaos theory in practice.
[QUOTE=JohnnyMo1;21788460]Replace m with b, economy plummets.
Chaos theory in practice.[/QUOTE]
Holy shit.
What an idiot.
If I would trade with that kind of money, I would atleast double-check it, to see if it was right.
Great. The economies of the world are now at the mercy of a bunch of paranoid bean counters who don't even know the alphabet.
Oh that's a bad miss.
PrismatexV8. I am almost certain the only thing you do is look for news to post here.
Someone's losing their job.
[QUOTE=Adius Shadow;21788763]PrismatexV8. I am almost certain the only thing you do is look for news to post here.[/QUOTE]
I've been counting, and on any given day, I've posted 60-75% of the threads on the front page in this section.
Should I slow down?
My dad happened to be doing some trades when this happened. We netted at least $300,000 today. Think it'll actually stick?
[QUOTE=Supacasey;21788835]My dad happened to be doing some trades when this happened. We netted at least $300,000 today. Think it'll actually stick?[/QUOTE]
Dude, you know what that means?
You could be smoking chronic every day for the rest of your life.
[QUOTE=PrismatexV8;21788846]Dude, you know what that means?
You could be smoking chronic every day for the rest of your life.[/QUOTE]
...if you live in a box
[QUOTE=Gummylamb;21788866]...if you live in a box[/QUOTE]
A high quality box for that matter.
[QUOTE=Saukkoman;21788912]A high quality box for that matter.[/QUOTE]
A box without monthly payments, that's for sure.
[QUOTE=PrismatexV8;21788846]Dude, you know what that means?
You could be smoking chronic every day for the rest of your life.[/QUOTE]
I... Don't know about [I]that[/I]. Maybe we could re-invest it or something. But holy shit we could've made millions if my dad didn't pull $500,000 from his stocks a few months ago.
I wonder how many people took full advantage of what happened. Think there's some incredibly lucky son of a bitch out there that made a few mill today?
The keyboard manufacturer's control the economy :v:
At least the 0 key didn't stick, otherwise we'd be in deep tits.
[QUOTE=JohnnyMo1;21788460]Replace m with b, economy plummets.
Chaos theory in practice.[/QUOTE]
I wanna see what happens if we replace a b with at t.
[QUOTE=Kinversulath;21790057]I wanna see what happens if we replace a b with at t.[/QUOTE]
A tillion huh?
Replace m with b, oh fuck oh fuck were gonna be poor.
Hmm..
What if someone replaced 'b' with 'm'? Would that fix the economy?
[QUOTE=Supacasey;21788960]I... Don't know about [I]that[/I]. Maybe we could re-invest it or something. But holy shit we could've made millions if my dad didn't pull $500,000 from his stocks a few months ago.
I wonder how many people took full advantage of what happened. Think there's some incredibly lucky son of a bitch out there that made a few mill today?[/QUOTE]
Put it into savings, 300,000 at a interest rate of .05 percent ends up being in 5 years nearly 350,000.
[QUOTE=pentium;21788516]Great. The economies of the world are now at the mercy of a bunch of paranoid bean counters who don't even know the alphabet.[/QUOTE]
They always have been since we accepted that fabolous system to dictate all our lives.
This is why the stock market should be an isolated entity.
That's all it takes?
My friend told me about this. Why the fuck didn't they double check.
[QUOTE=Supacasey;21788960]I... Don't know about [I]that[/I]. Maybe we could re-invest it or something. But holy shit we could've made millions if my dad didn't pull $500,000 from his stocks a few months ago.
I wonder how many people took full advantage of what happened. Think there's some incredibly lucky son of a bitch out there that made a few mill today?[/QUOTE]
Probably not many, It went down and back up again in like 5 minutes
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