General Discussion
Related: Editorials & Other Articles, Issue Forums, Alliance Forums, Region ForumsQuestion regarding the market disruption
The talking heads on the msm are saying that they hope ppl don't panic because the Dow has been frozen for an hour now. (Hope I'm using the correct lingo since I am totally Wall Street challenged).
But the stock exchange is closed overnight, weekends and holidays, so why would an hour's shut down for technical reasons cause a panic?
I hope this isn't a totally stupid question. If so, please put an L on my forehead.
merrily
(45,251 posts)Your question does not seem irrelevant. So, no "L" for you.
PoliticAverse
(26,366 posts)rush to see their shares as soon as the disruption ends.
Known downtime isn't 'uncertainty', surprise downtime that may happen again is.
'Uncertainty' can lead to panic.
liberal N proud
(60,336 posts)I can't think of any other purpose for them and their drivel.
Turn them off!
BKH70041
(961 posts)You ID'd the problem.
SheilaT
(23,156 posts)there are some here who are delighted every time the market loses a little value, so they'll be happy.
Not paying attention to what is happening in the market, but I understand that programmed trading causes lots of havoc, and maybe this freeze is connected to that.
unblock
(52,253 posts)well, others panic because they're told to and/or because they see the pros panic.
but most people don't trade overly frequently and not being able to trade for a particular couple of hours during which they likely wouldn't have traded anyway isn't really a cause for panic.
the pros, however, might get caught in the middle of a huge complex trade, expecting to take 3 milliseconds of risk to clip a tiny profit and wind up taking 3 hours of risk. it turns a complex, carefully planned business model into one big gamble and you didn't really even get to choose the bet.
to make it a bit more clear, many pros do not hold positions when the markets are closed, period. certainly they don't hold risky positions over the weekend. but they do take risky positions during the day in the expectation that they will get out of those positions before the end of the same day, often only minutes or seconds later; or, in the case of automated high-speed trading, milliseconds.
the trading halt means they are unexpectedly taking a huge and risky position for hours when the market is effectively closed, something not in their business plan.
that said, trading halts do happen, so that's part of the risk of that line of business. moreover, in this case, trading is still possible, just not at the nyse in particular. there are other places to trade nyse securities.
tavernier
(12,392 posts)Thanks!
Wish the talking heads would define it that way, since they've already stated how the (little) people with 401 K's might be concerned.
Kelvin Mace
(17,469 posts)the exchanges being down an hour or two. The people who care are flash traders and other financial parasites who thrive on churning the market, conducting thousands of trades a second, and skimming fractions of a penny each time. Wall Street's major profit center is "volatility". But, when markets get closed globally, their little games can come unglued and major train wrecks will occur.
Imagine the guy on the stage spinning ten plates on poles. Now imagine that thanks to computers he can spin a thousand. But when the markets shut down, he can't get to the poles.
Now imagine there are 100,000 guys spinning a thousand plates each.
That is today's financial market.
tavernier
(12,392 posts)and I don't suppose I'd live or die if they went either way. But it's nice to have some idea. Thanks!
still_one
(92,219 posts)a technical issue, and unfortunately for the MSM there is no panic, and there are other avenues where people can execute their trades, but that is a boring story, so lets make shit up