Dow Plunges Amid Europe Lending Worries [1000 points!]

The Dow plunged Thursday amid buzz in the market that European banks have halted lending.

One trader, on the condition of anonymity, said he heard fixed income desks in Europe shut down early because there was no liquidity — basically European banks are halting lending right now.

“This is similar to what took place pre-Lehman Brothers,” the trader said.

The Dow was down more than 900 points at one point, or more than 8 percent, before pulling back to the 600-700 point range.

cnbc.com/id/36988229

It has stablized around 450 now. Hopefully, by the end of the day it will pick up even more. :coolinoff: What a ride!

Personally, I think traders are using the European contagion as an excuse to take profits. 90% of U.S. companies report better than expected earnings. Companies with dividend are trading at a discount to the S & P’s PE.

Drudge is reporting:

CNBC: HUMAN ERROR IN TRADING CAUSED PLUNGE? TRADER PUSHED 'B' INSTEAD OF 'M'...

Something about Procter & Gamble:

SAN FRANCISCO (MarketWatch) – Shares of Procter & Gamble Co. /quotes/comstock/13*!pg/quotes/nls/pg (PG 60.95, -1.21, -1.95%) briefly plunged 23% Thursday before just as suddenly cutting its losses to 2% for the session. The Dow Jones Industrial Average /quotes/comstock/10w!i:dji/delayed (INDU 10,564, -303.96, -2.80%) component was last trading at $61. P&G shares were trading above $62 a share for most of the day until a sharp afternoon sell off sent the Dow down more than 900 points. The Dow was down 363 points with about 18 minutes left in the trading day. A P&G spokesperson said the household products giant was looking into the sudden drop in its stock price. Shares hit an intraday low of $39.37.
marketwatch.com/story/proctergamble-not-clear-why-share-price-plunged-2010-05-06

From Becky Quick at CNBC:
Human error was expected to have triggered intraday selloff. Somebody may have typed “billion” stedda “million”
More:
P&G calling its intraday plunge an issue with electronic exchanges. Didn’t fall below $56 on nyse trading.

THE MOST EXCITING MOMENT IN CNBC HISTORY: Jim Cramer Saves The Market

If you missed it, here’s the instant-classic video of Erin Burnett and Jim Cramer going nuts together as the Dow collapsed and then rebounds
businessinsider.com/the-most-exciting-moment-in-street-signs-history-jim-cramer-saves-the-market-2010-5

According to multiple sources, a trader entered a “b” for billion instead of an “m” for million in a trade possibly involving Procter & Gamble, a component in the Dow. (CNBC’s Jim Cramer noted suspicious price movement in P&G stock on air during the height of the market selloff.

cnbc.com/id/36999483

Could be a P&G error, maybe not.

There is plenty of reason for the market to be nervous, though. The irony of all this is that Europe is probably a good deal more delicate than everybody gave it credit for being just a few months ago. The U.S. on the other hand, could be the economy that pulls it all out if the U.S. politicians would just stop trying to be Grecian. Maybe then, people would invest in order to invest instead of day trading all the time.

I’d hate to be that guy tomorrow!

You know that commercial where they say, “Wanna get away?”. This would be perfect for that commercial.

That’s strange. So if someone types b instead of m on a keyboard, then the whole USA DJ stock market can plunge 1000 points and send the entire financial world of the USA in chaos and possibly cause a worldwide depression? All this worldwide international turmoil and chaos caused by one moron typing a b instead of m on a keyboard?

Yes, I think it strange too. Shouldn’t the stock exchange would have built-in safeguards to flag any transaction involving billions of shares of one stock? Perhaps ask the trader to re-type his order? And require the attention of someone in charge?

To my mind this means one of two things:

1 ) The stock market is actually set up so idiotically that we can’t trust it.

or

2 ) The stock market is so volitile (and easily manipulated) that we shouldn’t trust it.

If there’s another reasonable option I don’t know what it is, and “this was just a fluke” doesn’t raise my confidence very much. :o

Peace and God bless!

The market is being manupilated by market makers. People call it a 'computer glitch", translation=mm’s reached into your accounts and stole your cash! The software running this show trades gagillions of shares a day. It handles trading halts and resumptions of the likes of Dendreon (DNDN) etc… without failure. However knowing that the DJIA is an INDEX FUND… several stocks traded to rediculously low levels dragging down the index.

And everyone jumps on the GLITCH bandwagon? Every headline I see is "trading glitch. " We’re not all a bunch of idiots, so why is that a good enough explanation?

Trading “glitch?” Accross all of these tocks? (PG, ACN…etc…)

The media is a bunch of pansies. Nobody wants to get it right anymore.

What I want to know is who bought ACN at .02c - I mean seriously, who would have a buy order in at .02? It wouldn’t make sense. Not in the retail world. about 74k shares traded in the 1 minute that ACN hit .01 ( I don’t own, nor have owned any ACN). In order for it to sell, someone has to buy. I type at pretty decent speed and there’s no way I’d have caught that trade…

This manipulated MF is gonna bring this country down.

But I think “the system” did catch it, pretty shortly after it happened. Heard a former SEC guy on TV last night opine that the SEC will make them unwind the trades during that “valley” which was very short in length. Since nobody would have settled by today, I guess they can do that.

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