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The 3 Billion Dollar Typo

Posted by Zonk on from the this-is-why-coffee-is-a-daily-requirement dept.

Rand310 writes "Mizuho, the world's second largest bank based in Japan, with total assets of nearly the GDP of France (around 1.2 trillion USD) accidentally sold 610,000 shares, valued at $3.1 billion... for 1 yen each. A 27 billion yen loss would almost match Mizuho Securities' group net profit of 28.1 billion yen for the financial year ended in March, though... the incident would not threaten the brokerage's financial stability. FYI 1 yen is about .83 cents. Yesterday one share was selling at $5,065, today you could theoretically have bought 610,000 shares for $.0083 each. An expensive switch of variables."

10 of 398 comments (clear)

  1. Would be nice, but not really... by KingSkippus · · Score: 5, Informative

    No, the shares weren't actually sold for 1 yen each. From TFA:

    No buyer was actually able to pick up the phantom shares for 1 yen due to market rules designed to limit price fluctuations, but the shares may have gone as cheaply as 572,000 yen ($4,750) each, a more than 9 percent discount to the intended sale price.

    Selling the shares for 572,000 yen is where the 27 billion yen figure came from, not selling them for 1 yen.

    Also...

    ...you could theoretically have bought 610,000 shares for $.0083.

    Aside from the fact that you couldn't have theoretically bought the shares because of market safeguards already mentioned, that sentence is missing a very important word: 610,000 shares for $.0083 each.

    Still, it would have been one helluva holiday sale, wouldn't it?

    The other thing I thought was interesting was from the other article. It said:

    The accidental order was 42 times bigger than the number of issued shares, but a computer warning of the misplaced order was overlooked.

    How much yen do you want to bet that it's one of those stupid "Are you sure?" dialog boxes that everyone clicks "Yes" to without actually thinking about what it's asking? Ah, how I love ignoring those warnings, too.

    1. Re:Would be nice, but not really... by 110010001000 · · Score: 5, Informative

      Yes, but if Slashdot was more accurate it would be less dramatic. The idea is to increase pageviews by posting hyped and controversial "stories" in order to increase revenue. This was probably a policy instituted by upper management to help the flagging LNUX (Slashdots parent company) stock price.

      Haven't you noticed that as the stock price goes down, the hysteria on the front page goes up? Anything to make a buck!

    2. Re:Would be nice, but not really... by 91degrees · · Score: 5, Insightful

      How much yen do you want to bet that it's one of those stupid "Are you sure?" dialog boxes that everyone clicks "Yes" to without actually thinking about what it's asking? Ah, how I love ignoring those warnings, too.

      It's a constant grip of mine. I hate unneccesary confirmation dialogs (the result being I hate alost all of them). I can just about tolerate "This will overwrite a file", or "Save before quit" ones, but I keep running across designers who think insist on using modal dialogs for feedback. "You have just pressed a key. OK/Cancel". I make a point of querying this behaviour any time a designer comes up with it.

    3. Re:Would be nice, but not really... by jjapan · · Score: 5, Informative

      Actually the message box is rather large and declares the error very clearly. In addition it shows the details of what the action will do. Whoever did this really was either not watching or was using the safety net to enable some friends to make a killing. The news here interviewed day traders who made a lot of money on this deal. The blip lasted for about 3 minutes and was jumped on very quickly. The day traders referred to it as a "Christmas present". Investigation going on now. Be interesting to see what turns up.

    4. Re:Would be nice, but not really... by Anonymous Coward · · Score: 5, Funny

      That's very interesting.

  2. Data Validation by ||Plazm|| · · Score: 5, Insightful

    I wonder how many times the person(s) hit "Yes I am sure" when the system was telling them not to do it...

  3. Hmm... misleading post? by LordPhantom · · Score: 5, Insightful

    From TFA..... No buyer was actually able to pick up the phantom shares for 1 yen due to market rules designed to limit price fluctuations, but the shares may have gone as cheaply as 572,000 yen ($4,750) each, a more than 9 percent discount to the intended sale price. .... Mizuho's error has so far cost the broker some 27 billion yen ($224 million), Fukuda estimated. It appears that, in fact, they didn't lose BILLIONS but a few millions. Still large, but the post is misleading.

  4. You've got to admire the Mizuho execs... by The+Angry+Mick · · Score: 5, Interesting

    The company made a horrendous mistake and yet, there you see two executives bowing apologetically and taking responsibility on the day it happened .

    I have to wonder how a U.S. bank would have handled such a mistake?

    --

    I'm not tense. I'm just terribly, terribly, alert.

    1. Re:You've got to admire the Mizuho execs... by Valiss · · Score: 5, Funny

      The company made a horrendous mistake and yet, there you see two executives bowing apologetically and taking responsibility on the day it happened .

      I have to wonder how a U.S. bank would have handled such a mistake?


      Well, I can tell you it wouldn't be the company execs who would be bending over...

      --

      -Valiss
  5. Re:This brings a WHOLE new meaning... by JonTurner · · Score: 5, Funny

    >>I wonder which online deal site this was posted on first?

    FuckedCompany.com