High-Speed Trading Glitch Costs Investors Billions

http://dealbook.blogs.nytimes.com/2010/05/07/high-speed-trading-glitch-costs-investors-billions/?src=busln

One official said they identified “a huge, anomalous, unexplained surge in selling, it looks like in Chicago,” about 2:45 p.m. The source remained unknown, but that jolt apparently set off trading based on computer algorithms, which in turn rippled across indexes and spiraled out of control.

Many firms have computers that are programmed to automatically place buy or sell orders based on a variety of things that happen in the markets. Some of the simplest triggers are set off when a stock drops or rises a certain percent in the trading day, or when an index moves a specific amount.

But these orders can have a cascading effect. For example, if enough programs place sell orders when the overall market is down, say, 4 percent in a single day, those orders could push the market down even more — and set off programs that do not kick in until the market is down 5 percent, which in turn can have the effect of pushing stocks down even more.

In the future, undestanding the “Stock Market” will mean studying the AI’s that run it.

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Megabanks To Remain Behemoths

http://www.huffingtonpost.com/2010/05/06/senate-votes-for-wall-str_n_567063.html

The banks owned by the four largest financial firms in the U.S. collectively account for about 45 percent of all assets in the U.S. banking system, according to a HuffPost analysis of Federal Deposit Insurance Corporation data.

Those four megabanks collectively hold about $7.4 trillion in assets, according to the most recent regulatory filings with the Federal Reserve. That’s equal to about 52 percent of the nation’s estimated total output last year.

The top 12 banks in the U.S. control half the country’s deposits. By comparison, it took 25 banks to accomplish this feat in 2003 and 42 banks in 1998, according to a Jan. 4 research note by Jason M. Goldberg of Barclays Capital.

There are 23 bank-holding companies in the U.S. with more than $100 billion in assets, according to Federal Reserve data.


Deregulation leads to consolidation, not competition.

Jokes About Miami Airport Worker’s Body Scan Lead To Beating, Arrest

Jokes about wee wee-wee lead to beating

Rolando Negrin, 44, was charged with aggravated battery after he used a police baton to beat Hugh Osorno on Tuesday. According to a police complaint, Negrin was upset following a training with whole body scanners with other co-workers.

“The x-ray revealed [he] has a small penis and co-workers made fun of him on a daily basis,” the complaint read.

This body-scanning crap needs to stop. The Khan story makes it clear it’s a total lie to say these things get deleted (not to mention that makes the process useless for investigating terrorism).

Please, folks, quit being so scared, I’m losing too many rights and freedoms when you keep panicing.

[more coverage here]