Meet the "FLASH-CRASH" scapegoat. A report by regulators blamed May's spectacular market break on a single trade by a single "mutual fund complex" identified in the press as Waddell & Reed.
This was as ludicrous as blaming Mrs. O'Leary's cow rather than lax building codes for the Great Chicago Fire. The official explanation of the May 6 tumult, which saw the Dow plunge by nearly 1,000 points before largely recovering, does not hold up beyond a reasonable doubt.
In fact, the jargon-encrusted back pages of the report suggest that far greater damage was inflicted on investors that day by their brokerage firms. The brokers abandoned them to the wildfire. Call it progress: Never before have so many lambs been roasted so quickly.
fr Barrons 10/10/10
1 comment:
great post!
Love you!
Sara
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