computer stock trading gone mad??

[j427x]

has computer stock trading gone mad?

i was watching a little news blip on PBS tonight on computer stock trading---all i can say is !

these computer set ups are buying billions/ trillions of dollars in stocks holding them for less than 20 seconds then dumping them. that is long term?--LOL!

the average trade is bought and sold in 1-20th of a second!

and the time it takes the computers to get in or out of a stock is like .005 milliseconds!

these computers get their tips from watching things like internet trends using various web-spider programs. imagine 'face-book" full of web crawlers! LOL

the computer don't know what it is buying or selling all it knows is the up or down numbers and trends.

now the PBS newsman was like all is fine and dandy.

i am thinking it would not take much to set off a panic or a bull-rush.

whoever gave this news story to PBS left out that such computer trading systems could manipulate stock prices either up or down and a malfunction or software problem might cause a panic.

i suspect right now the program traders are pushing the market UP--but what is going to happen WHEN they decide to take the cash and run?

everybody else is going to get holding the bag.

[Lunyfringe]

(double tap)

[Lunyfringe]

If that got you upset, this idea will make your head explode:

If you figure out what a competitor's algorithm is programmed to do, and you can buy/sell to setup conditions where you know it will respond a certain way, what's to keep you from repeatedly manipulating the market to take advantage of their algorithm?

Keep in mind that if you "short" a stock, you can make money with it going down...

It's a big boys game, for sure- there are people lined up to take advantage of you if you're not understanding all the rules.

Originally Posted by j427x

i am thinking it would not take much to set off a panic or a bull-rush.

whoever gave this news story to PBS left out that such computer trading systems could manipulate stock prices either up or down and a malfunction or software problem might cause a panic.

i suspect right now the program traders are pushing the market UP--but what is going to happen WHEN they decide to take the cash and run?

everybody else is going to get holding the bag.

Look up "Black swan event"... It happened On May 6, 2010 - and will happen again- the markets have controls in place (now) that will halt trading after a runaway starts to limit the damage.

[j427x]

yea but the limits just prevent the market from crashing all at once.

they do not prevent a general sell off that is staged over a period of time.

i am guessing they got so much paper they can't dump it all at once due to there is just not enough currency to buy all the paper assets.

i figure their playing a little leverage game of sell , borrow and buy then sell again--

there is probably some shake outs on the way. after the election--just like last time--LOL

[withers.45]

I saw a news story similiar to this a while back that said some experts think this kinda thing will eventually destroy the market no matter what controls are in place. Now I got no idea about what goes on in the stock market and don't care to but its crazy that this one entity pretty much controls everyones financial well being or ruin.

[twa2471]

I don't own a single stock or bond, the only paper I hold is the green stuff in my wallet. Paper is just paper, nothing else to me. Give me gold, silver, guns, ammo and supplys thank you very much. My investments are antiques and guns period and hold a small amount of gold +silver I bought and stashed in the bank>30 years ago. I had some stocks several years ago but when I saw the web sight boom and bust that came 8-10 years ago. I could see that holding paper on something thats an intangible entitey would be stupid and I can't understand how anyone in there right mind could put there cash there????? I had some stock before that, i'd gotten at a couple places I've worked over the years and some Ben&Jerrys when it was a local start up. I did quite well with all of those, I held on to them for several years and they all split 2 and 3 ways more than once while I owned them. I ended up selling them in the early 80's just before the bottom fell out in 83-84. I was very lucky and did well enough to finance my second house with 40% up front. But I'd never do that again with all the shyster busness's like AIG, Fanny& Freddy, and the banks, NO FRIGGIN WAY!! Stocks and bonds can be manipulated so easy it's just not a safe place for your cash anymore. In a way that's a shame too, those investments in stocks could be used to hire poeple and expand busness's in this country, but the way things are now,administrativly, it's not worth the chance of investing. Prety sad comintary, right.