The action flick "2012" starts with a back story of a scientist checking and rechecking his calculations, trying to find the mistake in the analysis that shows the world is on the verge of ending. Surely there has to be a mistake in there, or the implications are just too scary.
That’s pretty much how it was with the market’s vertiginous May 6 plunge. As the event was unfolding, television commentators insisted that it was all a dream, a big, fat finger hitting the wrong key. Maybe a wrong decimal point in an order to sell Procter & Gamble (PG). A “b” instead of an “m” causing a sell order for billions of shares instead of millions. Surely — as in the movie — there had to be a mistake.
Wacko as some of the theories were, the impetus to search desperately for a mistake is understandable. Much better to find a flaw in the math or a problem with the computers than to confront the far more troubling possibility that fear and greed worked exactly as they have always worked, except that their effects were amplified by a jittery and fast-moving marketplace. That’s what we have to confront now.
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Edited by arbman, 18 May 2010 - 08:58 PM.
