Plunge In the SP 500 Futures Caused by a Fake Twitter Report About 'White House Explosions'
Courtesy of Jesse's Cafe Americain
Apparently someone hacked into the twitter account of the Associated Press and then issued a false report about explosions at the White House, and that President Obama was injured.
I imagine that swing triggered more than a few stops.
When I glanced over at my market screens, which are almost always on while I am reading and writing, I almost spit out my coffee.
Eh bien, tant pis! [Well too bad!]
But the almost instantaneous evaporation of market liquidity does highlight the precariously soufflé like nature of the US equity markets: rising high on fluff, with thin volume and less substance than appearances may suggest.
Virtually unrestrained high frequency electronic trading without specialists is a gun with a hair trigger, in the hands of those with a reckless disregard for the consequences as long as they are making easy money.
Be aware of the nature of the beast. The flow of momentum is easy and smooth, until it stops. And then comes the dawn of where we are, and what we have become. I have seen several people utterly ruined in such a volatile trading environment where risk is wantonly mispriced.
"The gates of hell are open night and day;
Smooth the descent, and easy is the way:
But to return, and view the cheerful skies,
In this the task and mighty labor lies."
