Are Goldman Sachs and the Megabanks Able to Wipe out an Entire Economy with a Keystroke?
How artificial intelligence and robotrading pose a growing threat to the global marketplace.
"We have found no evidence that these events were triggered by 'fat finger' errors, computer hacking, or terrorist activity, although we cannot completely rule out these possibilities," a recent Securities Exchange Commission (SEC) report on the so-called May 6 "Flash Crash" that wiped out a cool trillion in a mere half-hour weakly admitted. "Much work is needed to determine all of the causes of the market disruption."
"It was actually amazing watching it all happen," Gina Sanchez, senior analyst for Roubini Global Economics, told AlterNet by phone. "We went from risk-aversion to risk-seeking in the matter of an hour. But it doesn't bother me so much that the algorithms went after the bids. They were doing what they're supposed to do, which is seek out arbitrage opportunities. What concerned me was how the bids got out there in the first place."
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