Skip to main content

A three-way federal probe into Tuesday's hacking of the Associated Press Twitter feed is well underway.  While the FBI is looking into who did the actual cracking, the SEC and CFTC have also gotten involved as well--and their involvement could be more important in the long run.  The SEC and CFTC are looking into how the fake post of an attack on the White House that left President Obama injured caused the stock market to cough up $136 million of its value in five minutes.

“We have standard operating procedures whenever there are market developments, and this is no exception,” said John Nester, an S.E.C. spokesman. “These procedures start with getting the facts about what occurred. We do not limit ourselves to looking at the catalyst for an event, but also its repercussions, to determine whether any further inquiries or actions are warranted.”
The SEC and CFTC appear to be focusing on high-frequency trading algorithms that are programmed to react to certain headlines.  Apparently they haven't evolved with the growth of social media.  That doesn't sit well with CFTC commissioner John Chilton, who told CNBC yesterday that some changes need to be made, pronto.
Mr. Chilton, who referred to high frequency traders as “cheetahs,” noted that there was no “kill switch” in their technology to prevent them from acting on misinformation. “We need to set up basic rules of the road,” Mr. Chilton said. “We should not just accept technology blindly.”
Some of those high-frequency traders may have been behind trading in 28 futures contracts during that five-minute period; the CFTC is looking into them.

EMAIL TO A FRIEND X
Your Email has been sent.
You must add at least one tag to this diary before publishing it.

Add keywords that describe this diary. Separate multiple keywords with commas.
Tagging tips - Search For Tags - Browse For Tags

?

More Tagging tips:

A tag is a way to search for this diary. If someone is searching for "Barack Obama," is this a diary they'd be trying to find?

Use a person's full name, without any title. Senator Obama may become President Obama, and Michelle Obama might run for office.

If your diary covers an election or elected official, use election tags, which are generally the state abbreviation followed by the office. CA-01 is the first district House seat. CA-Sen covers both senate races. NY-GOV covers the New York governor's race.

Tags do not compound: that is, "education reform" is a completely different tag from "education". A tag like "reform" alone is probably not meaningful.

Consider if one or more of these tags fits your diary: Civil Rights, Community, Congress, Culture, Economy, Education, Elections, Energy, Environment, Health Care, International, Labor, Law, Media, Meta, National Security, Science, Transportation, or White House. If your diary is specific to a state, consider adding the state (California, Texas, etc). Keep in mind, though, that there are many wonderful and important diaries that don't fit in any of these tags. Don't worry if yours doesn't.

You can add a private note to this diary when hotlisting it:
Are you sure you want to remove this diary from your hotlist?
Are you sure you want to remove your recommendation? You can only recommend a diary once, so you will not be able to re-recommend it afterwards.
Rescue this diary, and add a note:
Are you sure you want to remove this diary from Rescue?
Choose where to republish this diary. The diary will be added to the queue for that group. Publish it from the queue to make it appear.

You must be a member of a group to use this feature.

Add a quick update to your diary without changing the diary itself:
Are you sure you want to remove this diary?
(The diary will be removed from the site and returned to your drafts for further editing.)
(The diary will be removed.)
Are you sure you want to save these changes to the published diary?

Comment Preferences

Subscribe or Donate to support Daily Kos.

Click here for the mobile view of the site