UAL stock plunge: When "oops" is an understatement

[Table 5]

Originally Posted by Bobblehead

It wasn't the Tribune's mistake.

you're right...was hoping somebody the level of the Tribune wouldn't make that sort of mistake.

[Hack&Lube]

Originally Posted by Table 5

you're right...was hoping somebody the level of the Tribune wouldn't make that sort of mistake.

What's the level of the Florida Sentinel? Probably better than Calgary Sun

[Mickey76]

These are usually terrible situations for all people involved (unless there is some sort of conspiracy involved). Trading it is almost impossible because you don't know if NASDAQ is going to bust the trades or not. I haven't looked at a time and sales log but say UAUA is trading around $10 and I don't own any but I see the market dropping like a stone and so I buy 2000 shares at $3, the market is crazy and I sell them at $7. I can hardly believe my good fortune. Next the NASDAQ announces they are busting all trades under $6. So my $7 trade stands but my $3 buy does not. So I am now marked as being short from $7 and if it is trading back at $10 I am out $6000 instead of being up $8000. I have seen this happen with emini futures traders where large sums of money were lost on the first trade being busted but covering trade standing.

[FlamesAddiction]

Wow. Its crazy to think that if you had a few disgruntled newspaper employees in a few cities across the states, they could sychronize something like this about a few large companies, and really screw a lot of fat cats over... You could have some pretty massive wealth redistribution.

It would suck to lose that much money over a 3rd party error like that. I wonder how many suits are financially ruined and are on the verge of suicide now...

[Bertuzzied]

It shows on my end the day low was $3. I guess the halted bid and ask was at 1 cent but nothing traded that low because the stock was halted.

[Cowboy89]

Originally Posted by FireFly

I believe I had a conversation about similar stuff with Cowboy yesterday...

Yeah except one variable is missing and that's the total volume traded. I seriously doubt many poor working class 401K investors lost everything on this one. Nasdaq has systems in place to force a hault in trading to allow the company to respond with clearifying information. The stock was haulted, trade orders were stopped, and proper information came out and it has already recovered to near normal trading. No need to usher in a new era of socialism for the entire economy because one hapless airline stock experienced something like this.

Look up First Calgary Petroleum last week. Another example of trading being haulted because of an information leak(s) regarding today's takeover announcement. In this case people would have made a lot of money while it skyrocketed up.

[Table 5]

Originally Posted by Hack&Lube

What's the level of the Florida Sentinel? Probably better than Calgary Sun

ha, well personally, I don't really hold ANYTHING in Florida to very high standards...

[Canada 02]

Originally Posted by Bertuzzied

It shows on my end the day low was $3. I guess the halted bid and ask was at 1 cent but nothing traded that low because the stock was halted.

thats what i see as well; large transactions took place. i don't think very many average Joes bought or sold their 100 shares

2.6M shares traded at $9.40
3.97M @ $3.72
5.56M @ $5.50
4.79M @ $7.28
2.2M @ $8.92

[Cowboy89]

Originally Posted by Canada 02

thats what i see as well; large transactions took place. i don't think very many average Joes bought or sold their 100 shares

2.6M shares traded at $9.40
3.97M @ $3.72
5.56M @ $5.50
4.79M @ $7.28
2.2M @ $8.92

I think it happend far too fast for 99% of average joes to be even able to react to this. I personally only found out about it after trading had initially been haulted.

[Table 5]

Originally Posted by FlamesAddiction

Wow. Its crazy to think that if you had a few disgruntled newspaper employees in a few cities across the states, they could sychronize something like this about a few large companies, and really screw a lot of fat cats over... You could have some pretty massive wealth redistribution.

uh, fat cats? do you really think that it's only the crazy rich that invest these days? With the advent of online trading, there are tons of small time investors out there who might not be investing millions, but have a lot at stake as well. Never mind the tons of money invested into RRSP/401ks....

A collapse of a few blue-chip companies would have repercussions for a huge percentage of the popullation....just look at what the collapse of Enron did.

[Bertuzzied]

Originally Posted by Cowboy89

I think it happend far too fast for 99% of average joes to be even able to react to this. I personally only found out about it after trading had initially been haulted.

But who would sell their shares for 1 cent? their average cost i would be at least $10 or over. you might as well hold onto it.

[Table 5]

Originally Posted by Bertuzzied

But who would sell their shares for 1 cent? their average cost i would be at least $10 or over. you might as well hold onto it.

Could happen if somebody has a market order (ie, to sell at whatever the current price is at that moment)....which for some reason, a lot of people still use.

[Bertuzzied]

Originally Posted by Table 5

Could happen if somebody has a market order (ie, to sell at whatever the current price is at that moment)....which for some reason, a lot of people still use.

It will be pretty unbelievable and probably impossible that if a stock was at $12 there would be no higher bidder then ones at a penny. Even when a stock legitimately declared bankruptcy in the past, no stock ever fell to 1 cent. Speculators will assure it of that.

well it doesn't really matter since it never hit a cent anyways.

[Slava]

My guess is that a lot of these sales were completed by large institutions and their computers that actually do the trades.

[Ronald Pagan]

To what extent is this situation an inherent risk of holding shares in a market? It is terrible for the holders but funds in the stock market are not insured making it riskier by nature than putting it in a bank account. Unexpected, exogenous events (like a propane explosion or in this case an accidental rumour) happen and people have to bare the risk.

[Table 5]

Originally Posted by Ronald Pagan

To what extent is this situation an inherent risk of holding shares in a market? It is terrible for the holders but funds in the stock market are not insured making it riskier by nature than putting it in a bank account. Unexpected, exogenous events (like a propane explosion or in this case an accidental rumour) happen and people have to bare the risk.

I would argue that putting your money into an index fund if safer than putting it in the bank over the long-term....sure it will go down at times, but it has always come back up and made money. Most bank accounts dont even keep up with inflation so you lose money over the long-term. And if the market just tanks overall where you lose all your money....well, then you probably have other things to worry about (ie, aliens attacking, world exploding).

[missdpuck]

Originally Posted by Table 5

ha, well personally, I don't really hold ANYTHING in Florida to very high standards...

Thanks and I really like your avatar too. Anyway I can't recall the names of the SunSentinel reporters who were recently caught up in "credibility" issues. I had a terrible experience with that paper myself. It's based in Ft. Lauderdale and the other pathetic local paper is the Palm Bch. Post.

[Superflyer]

I am not a stock market guru by any means but I would have to say that if everyone sold based on ONE newspaper article then they deserve to lose their money. There is this thing called the internets that can verify things like this in a few seconds. If something huge like United is declaring bankruptcy then it is going to be everywhere not just in the paper.
The brokers should have been able to say "Dude don't sell, some idiot in Florida is just making stuff up."

[Scrambler]

Originally Posted by Hack&Lube

Gosh darnit!

If I bought $5000 worth @ 1 cent a share and it went back to $10, I'd have $5 MILLION

Yes, but would have you bought $5000 in shares of a company you presume going bankrupt?

[fredr123]

http://online.wsj.com/article_print/...359017593.html

The Wall Street Journal is reporting that a Google news bot crawling the internets may be to blame thanks in large part to a popular undated story showing up on the Sun-Sentinel website.

Google traces the appearance of the 2002 article in its search engine to a process that began late last Saturday night. At 10:36 p.m. PDT, Google's "crawler" -- the technology that finds Web pages -- discovered a new link on the Web site of Tribune's South Florida Sun-Sentinel newspaper in a section called "Popular Stories: Business." The article -- which didn't carry a date but was published by the Chicago Tribune in December 2002 -- hadn't appeared there when Google's crawler last visited the page at 10:17 p.m., the company said.

It remains unclear how the old story rocketed onto the list of most popular stories. Tribune said online traffic began to tick up beginning earlier Saturday evening. Some UAL investors suspected there were efforts to manipulate Web traffic in order to sow fears about UAL's financial condition.

There may be a more innocuous explanation, however: Amid serious storms in Florida and on the East Coast, Web surfers checking for news about travel delays may have stumbled onto the old UAL story by mistake, and a small number of fresh hits may have been enough to drive it onto the list. A Tribune spokesman declined to say how many hits the article received but said there was no indication of fraud.

From the Sun-Sentinel site, the article became available through Google News service, accessible if a user searched for keywords like "United Airlines." The article didn't appear in any of the headlines on Google News's home page, but it was picked up and sent via email to people who had created a custom Google News alert about UAL or related topics.