Automated News Crawling Evaporates $1.14B

cmd writes "The Wall Street Journal reports that Google News crawled an obscure reprint of an article from 2002 when United Airlines was on the brink of bankruptcy. United Airlines has since recovered but due to a missing dateline, Google News ran the story as today's news. The story was then picked up by other news aggregators and eventually headlined as a news flash on Bloomberg. This triggered automated trading programs to dump UAL, cratering the stock from $12 to $3 and evaporating 1.14 billion dollars (nearly United's total market cap today) in shareholder wealth. The stock recovered within the day to $10 and is now trading at $9.62, a market cap of $300M less than before Google ran the story." The article makes clear that Google's news bot only noticed the old story because it has been voted up in popularity on the site of the South Florida Sun-Sentinel newspaper. The original thought was that stock manipulation may have been behind the incident, but this suspicion seems to be fading.

Comments

Hello? Is this thing on?

[szquirrel]

Google News crawled an obscure reprint...

The story was then picked up by other news aggregators...

This triggered automated trading programs...

Is there even a live person at the wheel anymore? Or is SkyNet just fucking with us now?

Re:Holy crap.

[jandrese]

Who's responsibility though? Should Google have people fact check every news story their bots pick up before putting it up on the aggregator? Should stock companies put fact checkers between the newsfeeds and their stock sale bots? Should online newspapers have fact checkers on every article they put online?

This does show just how fragile a system can be when there is a strong disincentive to going second or third on tasks that one would normally think you should have human interaction.