Slashdot Mirror
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.
... the power of the GOOG!!
There is a war going on for your mind.
When you're talking about numbers like that then there is definitely a responsibility somewhere to try to prevent it happening again.
...perhaps they'll be more careful about whose luggage they lose.
I laughed so hard my coworkers made me go outside.
I love Google.
ed duval the very last person
Slashdot Idle had this story 24 hours before the main page.....
"I planned within my means and got a fixed rate mortgage, so where's MY bailout?" -cafepress
So the NewsBots trick the TradeBots, and we humans are left on the sidelines, hoping that we don't get squished in the process.
Sounds like a sad Transformers sequel.
A post a day keeps productivity at bay.
"Google regrets the error." What, it always works for the New York Times!
It would be so awesome if the Google news bot was able to dig up some old dirt on Google that would make it's ~$450 per share stock crater... that would be an awesome site to behold.
I doubt it'll happen, since there haven't been any previously bad financial reports that could come back and masquerade as current news, but you never know.
It also serves to show how fragile our financial system is (just read the "what if" reports on what would have happened if Fannie Mac/Freddie Mae were allowed to go under... it would have been BAD). Sure, United gained back most of its value but it's still down a good bit of cash. It reminds me of when Abbie Hoffman threw a bunch of $1 bills onto the NYSE trading floor and TRADING STOPPED as the floor traders ran around picking up the bills.
It's because google is going to launch their own airline.
"I'm sorry, Mr. Schmidt. Your flight has been delayed by two hours."
"Son of a... do you people know who I am? Dammit, get Brin on the phone."
I've noticed a few time lately that the BBC News site's 'most read' list contains stories from years ago. It's very misleading because the links are on the main news page and the date, although present at the top of each story, is fairly subdued. I've been caught out a couple of times by this. Of course, once a story gets on the 'most read' list everyone clicks on it pushing it further up the list and prolonging its being there.
I'll have to point to this next time someone finds an error on my website.
Never happen.
Every brokerage house in the country is increasing their presence in "Automated Trading". The majority of these companies income is now made on small percentage point fluctuations brokered very fast. With the automated systems pulling in that much more money than the traditional ones, and with more algorithms being designed (and held as proprietary info), what would YOU do?
Ridiculous? Yes. Not going away? Also Yes.
Might as well vote to bring back the horse drawn carriage since the price of gas has risen so much lately.
This space for rent. All reasonable inquiries will be entertained at proprietors discretion.
After reading TFA, it sounds like google is LEAST to blame out of the many many automated systems involved. First of all, the damn story should have been dated. That's the tribune's fault. Google doesn't seem to have claimed it as today's news, only ranked it high up. No one should have ever reprinted the story without actually CHECKING WITH UNITED AIR FIRST. That's neither google nor the tribune's fault. That's every service that reprinted the story as new without verifying its fault. Google and tribune seem least at fault because neither ever gave any indication it was a new story.
If an officer ever threatens to taze you, say you have a pacemaker.
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?
Never approach a vast undertaking with a half-vast plan.
Cautionary tale for the Web 2.0/semantic web or whatever they are calling it now.
putting the 'B' in LGBTQ+
I am by no means a lawyer but it sounds like the automated trading software has the majority of the blame since it is the one that actually intiated the trade. So what if google descided to reprint old news...nothing wrong with that.
Trying to install linux on my microwave, but keep getting a kernel panic...
I wonder who gets sued for this. Obviously Google's Crawler was at fault, somewhat, but that one error shows a flaw in a lot of other news site handling of information (or misinformation as this was), especially Bloomberg - all for lack of actually double checking sources and dare I mention, actual facts, before running a story.
In a day and age where everyone is automating news feeds, I'd like to believe that someone out there should be responsible for approving posts - much like how I do syndicated posts on my wordpress blog...of course, asking for someone to take responsibility for anything in America is asking too much anyway...
Ave Molech Setting
Maybe if the industry you were in wasn't on the brink of an economic disaster for the past 7 years an old story being dug up by Google News wouldn't have had such a drastic impact.
Money doesn't just evaporate, I'm sure it's still somewhere!
I wonder who gets sued for this. Obviously Google's Crawler was at fault, somewhat
How do you figure that? It's doing what it's supposed to. The problem wasn't the crawler, it's the people who thought the crawler was some kind of magic AI that could find relevant stories for them.
Ouch.
That said, are automated trading systems going to be this decade's great Ponzi scheme? I can't believe so many people can be so lazy with their investments to send the stock tumbling that much.
It looks like the ones who'll ultimately get burned from this are are those who are careless with their money. But how soon before people take advantage of viral networking to manipulate Google's algorithms for determining popular news, bring up old doom and gloom articles to intentionally tank a stock so they can buy while it's cheap?
Charisma is the measure of someone's ability to lie with a straight face.
It's gambling, it isn't investing.
Deleted
You're kidding me, right? Stockholders entrusted their assets to managers who entrusted their assets to tradebots. The tradebots/managers made bad decisions. How can the tradebots/managers/stockholders now blame anyone else for their incompetence?
Anyone who sells something of value based on a rumor this thin deserves what they get. As for those who didn't sell and still lost value, anyone who has been in the stock market for very long knows that you sometimes get what others deserve.
"We reject as false the choice between our safety and our ideals." --The American President (20.1.2009)
"It's because Google is going to launch their own airline."
Yeah, they'll call it "United Airlines BETA".
"Oops."
This smells like a case of the Frankenstein complex to me. Although Google News may have linked the article in its recent results because of the fresh link on the Sun Sentinel home page, both the WSJ article and the Forbes investigation make it very clear that the problem was a human editor who misinterpreted the original article and posted it as new information (with a freshly written headline) in a by-subscription-only investor information service that is carried on Bloomberg trading terminals.
A human saw the story, failed to check the date (there was no date line at the top of the article), refreshed it with a new headline, and republished it on a trading service that was believed to be a source of credible journalism by its readers.
How and why would a 5-year old story about bankruptcy suddenly get "voted up" in at the South Florida Sun-Sentinel so that news aggregators (and google-bot) would pick it up? Sounds very suspicious to me.
So are you telling me that I could set up a "click-bot" to vote up old-news and make myself rich in the ensuing mayhem?
First of all, this is fucking hilarious. Anyone with "computers that robotically [sic] troll the Web for news stories and execute stock trades automatically" deserves to reap the consequences of turning their destiny over to a computer.
Second, I doubt that any capitol was destroyed by this. Wealth didn't "evaporate," it merely moved from stupid people to smarter people.
I only wish I were one of the smarter people, who bought some stock worth $12 for $3. I should write a program to watch for that sort of thing happening, and then automatically buy-- oh wait.
As copyright owner of this comment, I authorize everyone to defeat any technological measure which limits access to it.
Wow. Take a look at Monday's trading history for UAUA. Look at that drop. And notice that it happened on huge volume; several hundred million dollars changed hands within fifteen minutes. It wasn't just a few traders running the price down in light trading.
The stock hasn't come back all the way. It's still down 20% for the week.
Here's the newspaper page that started it all, as archived by Google.
No, what the article makes clear is the way the stockmatket is run now has nothing to do with "investing" in a company because you think they offer good products or services so they will grow and prosper in the future, and everything to do with it being it a big stupid gambling casino that has zilch to do with traditional investing. A congame run by charlatan conmen to take advantage and leech off the suckers. Goes hand in pickpocketing hand with those big financial "industry" thieves who are quick to grab megaprofits when they successfully con people into taking their toxic waste pieces of paper, and right there with those same hands out taking tax payer bailouts when they run up against serious losses because of their overwhelming greed being the most important aspect to their "busy-ness".
Another point that no one seems to be picking up on is the problem of a lot of news sites neglecting to include a dateline on their stories. I've run in to this a number of times, and it makes it difficult to determine the relevance of a given story. It's a very simple thing to include the date the story was published, but a lot of sites don't seem to bother.
I don't care why you're posting AC
Seems like there is an opportunity to create a purely online stock exchange, where all subscribers trade on equal terms?
Seems like there's at least one purely online stock exchange. Though that may not mean internet, and I'm not sure about equal terms.
(T>t && O(n)--) == sqrt(666)
_Debt of Honor_ - Tom Clancy
It also involved a easter egg in the trading computers.
So... if Google newsbot picked up the story about Google newsbot's near destruction of United Airlines... would that make it self-aware? :D [/joke]
Anyway, one interesting thing this story brings up is our over-reliance on automated systems... Googlebot picks up the old story, a financial firm's automated query systems sees the story as a recent one, the system spreads the story to its feeds, and it winds up as an alert in Bloomberg (the trading software, for those who've never worked with a trading firm) and other financial systems.
It's such a very fragile structure, wherein a single word can irrevocably alter the fate of a company, or even events around the world (butterfly effect, and a company like UA is a big butterfly). In the end, machines won't have to enslave mankind to take over the world. We've gladly handed them the keys and gone on vacation in the Bahamas...
'Alright class, yesterday we learned how to automatically sell stocks protect our money. Today I'll show you why you shouldn't ever do that'
I think a few day traders missed class that day.
But clearly you have something better to say...
...die by the sword.
If you're trading based on news, minutes or seconds of advantage, and arbitrage, then you'll occasionally get nailed by something unforseen. Like a two-or three year old news story that 'looks' new all of a sudden.
So is someone watching over this, ready to pull the plug if something doesn't smell right? Nope. When the timing is so short, you're at the mercy of the system.
Besides, most of these programs are pure arbitrage. Which is sort of the 'greater fool' theory in play. You make money at someone else's expense. Like they didn't know about something, and you sell out a minute before they find out.
In this case, justice, if there is any, is won by those who saw the activity, realized the mistake, bought low and sold back high. Too bad, big institutional investor. You lost this round.
I can't shed a tear.
deleting the extra space after periods so i can stay relevant, yeah.
Not only is it unnecessary, but such a law would be completely unenforceable. Look at how much trouble online gaming servers have in preventing people from running bots which play their characters for them.
If I can be modded down for being a troll, can I be modded up for being an orc, or a balrog?
When a blip at a local Florida newspaper can combine with a trivial bug to destroy a major American airline in a morning, the economy and the "reporting" that the economy depends on is revealed to be a giant joke.
This episode was remarkable because it was huge, fast, and concentrated in a single high profile corporation. But how much of this broken system's smaller problems go "unnoticed"? Unnoticed as problems, at least, but showing up in all kinds of market valuations and economic decisions based on them that are all built on a landscape of errors, omissions and misunderestimations?
How can you trust an economy that makes mistakes like that? Anyone smart would find any alternative that's less crazy and put their money into it.
--
make install -not war
Burn 1500 $100 notes and the value will still be around somewhere, because less cash circulating will cause a drop in prices, so everybody else's cash will be worth a little bit more. But drive your new Porsche into a wall and you'll see $150 thousand evaporate.
A $1 billion drop in market value means that there's $1 billion somewhere that left the stock market to be spent on other things. This causes inflation, everybody's cash will have a somewhat smaller value.
"Buy and Hold" is generally good, but if the stock's going bankrupt, holding it any longer isn't going to do you much good. You've got to know when to fold them.
(I once used a similar technique back during the Boom&Crash years, called "Wasn't paying attention that month", which cost me most of the value of a stock I held too much of - it went from ~60 to ~3, and never recovered past about ~5.)
Bill Stewart
New Fast-Compression-only CPR http://preview.tinyurl.com/dy575ks
This wasn't Google's, it was the Tribune that posted the story as new. Google just picked it up and republished it, as they do with all news, without any guarantee that it's accurate.
And the people who caused United to lose the money were automated trading programs. Maybe they should be made a bit more robust? Just a thought.
Only an idiot defaults a missing date to today. Sensible defaults are 0000-00-00 and 1970-01-01, or their equivalent, according to context.
... it will be now
If you can read this... 01110101 01110010 00100000 01100001 00100000 01100111 01100101 01100101 01101011
Exactly. People who watch the news all day going BUY SELL BUY SELL are just asking to lose money on mistakes like this.
This practice has failed catastrophically in the past, and been likened to "picking up pennies in front of a steamroller". The problem is twofold. First, to make any money at this, you have to throw a lot of money behind it. A 0.1% gain over an extremely short period of time is only worthwhile if it's an 0.1% gain on millions, or billions of dollars. The problem is, sometimes something unexpected happens (the asian economy has a crisis, sub-prime lending collapses, you get a bad tip that United is going belly up), and instead of the 0.1% gain, you end up with a big loss.
So, yes, I understand that the idea of a "free money machine" is very appealing, but people are ignoring the risk. That needs to stop. It's a risk to the stability of the economy.
... bought UAL stock at just $3? Oh wait.
now we need to go OSS in diesel cars
I thought it was a secret plot by Google to launch their new Google Air at a fraction of the price they were looking at yesterday.
Just goes to show the fun that can happen when automated programs respond to automated programs. One wrong switch and Pandora is unleashed.
At what price learning? At what cost wisdom? The price is a man's peace of mind, and the cost is his life.