As It Turns Out, A Single Citigroup Idiot Can Implode the Entire Economy With One Extra Zero But Greece Can't
Pic credit: toothpaste for dinner
Paint me suspicious but I call bullshit, not just regular bullshit but "OMG, do you really think we believe this?!" bullshit.
In one of the most dizzying half-hours in stock market history, the Dow plunged nearly 1,000 points before paring those losses—all apparently due to a trader error.Of course, P&G is cool with going down that road, ignoring the fact that Citigroup is denying having anything to do with today's epic oopsie (or should that be alleged oopsie?). More CNBC:
According to multiple sources, a trader entered a "b" for billion instead of an "m" for million in a trade possibly involving Procter & Gamble, a component in the Dow.
"We don't know what caused it," said Procter & Gamble spokeswoman Jennifer Chelune. "We know that that was an electronic trade...and we're looking into it with Nasdaq and the other major electronic exchanges."Meanwhile, hedge fund manager Troy Buckner of NuWave Investments said it was nothing more than speculation on energy, equity, and metals that went BOOM as speculative bubbles tend to do.
A different P&G spokesman had said earlier the company contacted the Securities and Exchange Commission, but Chelune said that he spoke in error.
One NYSE employee leaving the Big Board's headquarters in lower Manhattan said the P&G share plunge lay at the center of whatever happened.
"I'll give you a tip," the employee said, speaking on condition of anonymity. "P&G. Check out the low sale of the day. Something screwed up with the system. It traded down $30 at one point."
Adding to the fire, we have Greece - sweet, precious, broken Greece - and WSJ is implying we're right back in 2008. No, 2010 is not the new 2008, it's 2010 and welcome to the part where the cracks start to spread and the shit comes pouring out. That's not what happened in 2008. In totally related news (h/t Prudent Investor), the ECB would like to limit cash deals in Greece *hint hint nudge nudge* but it's to combat tax evasion, not because there is any problem over there, surely:
NASDAQ is canceling the fucked up trades and Greece is still a wreck so I'm not sure if this is a yay or an oh shit. I hope someone at the Fed is taking notes at how the ECB handles this sort of... mess.
While promoting the Euro as a safe store of value the ECB opts for tight limits on cash transactions in Greece, limiting the role of cash Euros as a medium of exchange, one of the fundamental functions of a currency.
Stating the objective to limit tax evasion the ECB recommends that all business transactions above €3,000 and all consumer expenses above €1,500 Euros shall be paid for in all other forms than cash.
The most important excerpts from the document:On 26 March 2010 the European Central Bank (ECB) received a request from the Greek Ministry of Finance for an opinion on a draft law on restoring fairness in taxation and addressing tax evasion (hereinafter the ‘draft law’)...Among other things, the draft law is intended to progressively establish the use of electronic invoices. Article 20 of the draft law introduces specific restrictions on cash payments in favour of other means of payment, in order to ensure the genuineness of transactions and underlying documents and to enable direct cross-checking of such transactions.Article 20(2) of the draft law states that, for transactions between businesses, invoices and equivalent documents with a value exceeding EUR 3 000 shall be paid through business bank accounts or by cheques drawn on and paid to such accounts. These accounts will be connected to a secure electronic database held by the Ministry of Finance’s General Secretariat for Information Systems (GSIS). Banking secrecy is lifted for this purpose and banks may not charge fees for the operation of such business accounts.Under Article 20(3) of the draft law, invoices with a value exceeding EUR 1 500 for the sale of goods or services to consumers shall be paid through a bank with debit cards, credit cards or cheques, and the use of cash will not be allowed...Whatever the reason given, this is a clear writing on the wall that limitations of the use of cash in the troubled Eurozone have become a central bank tool, contrary to free market philosophy.
Oh and don't miss Jim Cramer saying to get in and get a piece of this "crazy market" and that he liked P&G at 49. Uhhh...