this post was submitted on 06 Aug 2023
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Today I Learned (TIL)
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They were not real dollars and of course nobody was punished because the stock market is a casino where the house makes the rules on favor of the wealthy.
They were real dollars, and this legend got house arrest for a year for helping to trip the algos limit orders, and briefly wiped 1 trillion dollars of value off the US stock market
https://www.bbc.com/news/explainers-51265169
Not even mad. Respect to this dude for striking fear into the hearts of the asshole class, if only for a few glorious minutes.
So the guy played with the system, doing things the system allows ,but because he wasn't in the club he got punished 🤷
A tale as old as time.
He wasn't the real cause of it though.
What do you mean? There was a liquidity crunch because of a massive mutual fund order and his spoofing tripped the algos into selling
OP's article is quite good.
It's more likely that there were several factors in play, including Wadell & Reed.
But if the market practices weren't so flawed with HFTs, none of that would have caused what happened.
Yeah, as it says it's like blaming lightning for starting a forest far.
The current dark pool stuff is probably ten times worse.
Define ‘real dollars’ lol. Most money is just numbers on a spreadsheet.
Value of stocks is what they think people will pay, but if nobody wants to buy they are worth nothing. If stocks can change in value in fractions of seconds, they have no actual monetary worth, so nothing was lost and nothing was gained during this dip and recovery.
Blah blah if you squint enough the same is true of paper money and lending, but that at least has some monetary banking while stocks are purely at a moments whim.
You see, the problem with your argument is that stock isn’t money, it’s an asset. While you can call the asset itself bogus, the money backing it is ‘real’; that’s why entire life savings can be wiped out if the market suddenly goes ‘kaput’.
So you are also saying that stocks are not real dollars. Glad we agree.
Stocks aren’t money to begin with, they’re an asset class. The money invested in stocks is as real as any other dollar though.