If the bank makes a mistake and puts a million in my bank account it's not my money

what about what happened on Wall Street? IF it was a 'mistake' does everyone give back their ill gotten gain?

Just look at the "monopoly" board game card "bank error in your favor."

Or, did there really used to be a "Get Out of Jail Free" card people gave you, too?

the ten dollars I won in the beauty contest.

you can't go wrong. They aren't the biggest return, but they are constant.

since I work for a utility company. And in reality, you're right. Any company that is guaranteed a profit can't go too far wrong. When my company sends out employee stock purchase materials later this month, I plan on loading up at the favorable prices they'll offer.

If the market worked companies' stock would rarely sell for more than they are worth, but big companies often sit on banks of cash. The market is just a gambling consortium anymore, and just like with Vegas, it is now pretty much owned by a Mafia group of people.

How about just delete everything that happened 5-6 and start it up again tomorrow morning?

lol...

If they were to unwind this, it would be INCREDIBLY messy!

(Example of a stop loss for those who don't trade: You have 100 shares of XYZ corporation. You paid $30 and it is currently trading at $50. You tell your broker to put in a sell order when it drops to $40. He/she enters that into a computer and it sits for months. Today, when the market tanked, your order kicked in and you sold at $40. 5 minutes later, it is back to $47, but you don't own it anymore. The sale was forced because of the trigger and automatically happened. This happened millions of times today to unwary investors who thought they were protecting their position in the offchance of a sellout due to a company problem, like BP when the spill happened, not market or system-wide risk as this was)

Edit to add -- if they were to find fraud and attempt to unwind today's activity, they would have to make whole all of these people who lost their positions due to stop loss triggers.

if there was a desire..or maybe the people who were enriched don't believe in fixing a 'problem'?...WHAT ABOUT THE LOSERS??? THEY ARE JUST SCREWN?

As far as unwinding. I'll use my example. I sold today at the $40 I mentioned, and the stock is now at $47. Whose responsibility is it to make me whole with 100 new shares?

That is the problem with system-wide risk blowing through so many stop loss orders. It wasn't just me and my trade, it was the guy who has a stop loss on my stock at $42, and they guy who had a buy in the system at $44 and the other guy who had a stop at $46 and the other guy who scheduled to buy at $47 - multiplied by the entire market. Once these sell stops and buy limits triggered, it was a bloodbath.

Normal trading on any given day is $200 million shares. Today was 450 million. There are people all over the country tonight logging into their accounts to see what they still own and what they don't.

"Ted Kaufman and Mark Warner making the case for high frequency trading reform on the floor" -- happening now.

This HFT (high frequency trading) is what caused the blowouts - it is the use of computers to trigger all of the activity automatically. Looks like the Senate is already jumping on it.

It allows far too much money (hundreds of billions of dollars per second) to trade to quickly. There is no way for a human to oversee it or catch mistakes.

One broker who uses HFT (he simply plays by the rules regulators set - his words) said this will happen again and again and again unless curbs are put in place to limit speed of order executions.

How many people lost their positions in a space of 15 minutes?

Those with stops in there to "protect" themselves got anhilated.

If they purchased a put instead (with strike at their "out" point) the put lost a lot of value but that value came back as the rebound happened.

would have been a bunch less than what many of those stop limits left people with.

Much less downside risk to long stock + long put.

A penny a dollar on anything held less than a year.

That would slow things down, make the market quite leisurely in fact, like walking on a sidewalk rather than skating on thin ice.

... a small fraction of a penny.

I also think capital gains taxes should start high and decrease to zero over of span of many years.

The same as c-shares (paid on a 13 month trail to the broker)

If we implement something on the short holds (< 1 yr) to add to the ordinary income on gains, it may slow down the casino.

... is adding more categories, so that there's a high rate for securities held less than one year... a somewhat lower rate for less than (say) five years... still lower for less than 10 years, etc. etc.

And at some point, say 15 or 20 years (for the true, fanatic buy-and-hold types, not to mention amnesiacs and coma survivors!)... congratulations, we'll treat it like a Roth. No cap gains, the jackpot's all yours.

Disclaimer: I haven't gone beyond the "Wouldn't-It-Be-Neat-If" stage with this, to consider possible pitfalls and unintended consequences.

Now, if you'll excuse me, I'm going to stroll down to the corner store to buy a winning lottery ticket. Because that could happen too! Theoretically. :D

I LOVE the idea of long term incentives. Not only for investors, but for executives who manage their company based on quarterly performance without regard to LT planning.

I was hoping for that when it imploded in 2008.

The entire banking and credit system is completely fraudulent. Real value is based on Gold and Silver.It's all a crazy money game, and we( the people) are forever to be deemed slaves of the so-called Monetary system, we are corporate workers making enough money to survive but giving over every other penny by law as an enslavement from The United States of America, Inc. Yes, it really is a corporation.

They lost a lot and no they won't be getting it back.

I'm not sure what to think, but that sounds fishy. There are triggers in place to catch this kind of thing that require overrides.

While it may not be as simple as m vs b, something put massive amount of selling pressure on the market in span on a few minutes. The only thing with that kind of reaction time is high frequency trading computers. To put that kind of pressure on the market you need to be selling and selling a utterly massive amount of stock and selling it at market.

So some brokerage either by a faulty flash trade program or mistake in programming sold an unbelievable amount of stock at well below market value and did it the whole way down. On accenture for example (and there are roughly a dozen others) a market order executed against the ENTIRE BUY stack. There is a queue of buy orders. Someone willing to buy at $41, someone else at $40.99, $40.09, ...... $30 ..... $10 ..... $0.04. These orders (limit orders) sit there waiting for execution. There are thousands of limit orders on any major stock worth millions of shares.

Something was executing that was so huge it blew out the entire buy stack. For anyone to think this was intentional or normal "selling" has no idea what they were talking about. The program was like a terminator out of control. It sold some at $41, some at $40.99, some at $30, some at $10 some at $0.04 it sold to every single buyer on the planet and still had more it was trying to sell.

The stock printed a bid of $0.00 at 2:47:38 (and 18 milliseconds). That means there wasn't a single bid at any price from anyone on the planet for this stock. To think this is normal market behavior is silly. What that means if for a fraction of a second the buy order sold against every single buyer on the market. If this was a rational market it would mean nobody on the entire planet believed accenture was worth even a penny not even a fraction of a penny. Nobody on the planet was even willing to pay $0.000000001 per share (million shares for $1). 9 minutes later the stock was back up to $41.

Anyone thinking this is normal and not a glitch or failure in the system needs their head examined or is simply believing what they want to believe. Who ever did that selling of Accenture lost an utterly unbelivable amount of money.

Thanks.

Oh, I can't rec a post?

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=389x8287642

This doesn't help those whose stops triggered on fake prices, only claws-back (in a sense) the profit takers.

Many $$$Billion$$$ of dollars lost today on stocks NOT on the list that were falsely trading lower than normal due to the whole market taking a dive.