Saturday, Sep 20, 2008
The surge in financial shares was driven at least in part by traders who were forced to buy those stocks to cover earlier short sales, raising doubts about whether the rally will last.
New York Times: Markets Soar, but New Rules Upset Traders
Computers that automatically buy and sell for big investors hit snags because they were not programmed for such a restriction. Securities firms and money managers that routinely sell short to hedge against possible losses wondered how they would cope. In certain stocks and funds traded on New York Stock Exchange, some prices and trades were “erroneous,” a spokesman said. Hedge fund managers who made vast profits betting against the nation’s financial titans called the ban unfair, and said the move would only prolong the financial crisis. Some traders said they were no longer betting on the intrinsic health of companies, but rather on what the government might do next.
Posted by stevie dee @ 11:00 AM (182 views) Add Comment
1 Comment
- If you do not have an admin password leave the password field blank.
- If you would like to request a password allowing you to add comments and blog news articles without needing each one approved manually, send an e-mail to the webmaster.
- Your email address is required so we can verify that the comment is genuine. It will not be posted anywhere on the site, will be stored confidentially by us and never given out to any third party.
- Please note that any viewpoints published here as comments are user's views and not the views of HousePriceCrash.co.uk.
- Please adhere to the Guidelines
1. last_days_of_disco said...
Here we, go, why banning short selling is going to be an utter disaster.
Here's the plan:
1. The world is going through a period of unheard of instability.
2. Just about all trades are executed by very complex software.
3. Its been perfected over decades and is pretty stable now.
4. Now things are getting very dicey
5. Time to start modifying large chunks of the software to handle a weird non-linearity that only applies to certain trades.
6. Do this while the market is imploding and the developers are who have been paid in share options and don't give a stuff about the rich front office guys who treat them like losers.
If you really want to stuff things up. you need a computer and I can see the looks on the techies faces. Why work all weekend to be fired on Monday. Changing software like this is going to generate even more instability. My gosh there are going to be some glorious stuff ups.