Wednesday, September 15, 2010

They Just Don't Trust Wall Street

On CNBC 'Flash Crash' Effect: Investors Don't Trust Wall Street

  • Nearly five months after the May 6 Flash Crash, many individual investors see the stock market as rigged, and they have little confidence in regulators to fix it.

    Most of the poll's 1,035 respondents view the market as unfair to small investors.
    In a new CNBC/Associated Press poll, 86 percent of the 1,035 respondents view the market as unfair to small investors..... ( more here )

Does it show?

Could this be the very reason that 65 Billion Outflow From Long Term Equity Funds?

Then I saw the following article on ZH: Another Day, Another Flash Crash

  • It has been about a week since we have had a flash crash in our broken markets, and we were getting a little antsy. Then Nucor showed up and traded at $0.01. At 11:52:21 something broke, and as the QR chart below shows, it was basically precisely the same algo malfunction that either goes and hits all bids all the way to zero, or some HFT decided to shut down, and wipe out the entire bidside orderbook. The stock which had been trading at $39.58 literally milliseconds earlier, saw a SkyNet T-1 unit go berserk and take out the bids at $37.22, and $35.77 in sequential fashion, with the next trade being at at the residual stub quote of $0.01. Of course, circuit breakers were triggered, but not before even more irreversible damage to investor confidence was suffered. And those idiots 'upstairs' still wonder why tomorrow we will report another massive outflow from mutual funds.

    There is a pattern emerging: every week we are seeing a flash crash in more and more prominent stocks. These are getting more and more frequent. And instead of fixing the underlying cause, the SEC continues to fret with reactive damage control, and DKing trades of those who are brave enough to step in and take advantage of broken algos. How long will this kindof bullshit travesty continue?

A stock that was trading at $39.58 hit $0.01 milliseconds later?


The machines... the machines... the machines... the machines did it!


bonny b said...

Sounds so familiar, so close...where have we heard these types of complaints before?? Or are we all recalling nightmares past?? Must buy a good supply of feel-good pills..

Moolah said...

CNN money wrap: "Stocks managed to pare some losses Tuesday on better-than-expected retail sales data, but indexes ended mixed as investors stepped back from a recent runup..... "


pare some losses on better-than-expected retail sales data?


1. Firstly.. retail numbers were out b4 the market opened. :P

2. How good was the better than expected numbers? LOL!

..... ya... the feel good pills is being shared. :P