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Dodd: High-speed Trading May Have Been Responsible For Last Week's Market Crash

May 13, 2010 by  

Dodd: High-speed trading may have been responsible for last week's market crashSenate Banking Committee Chairman Chris Dodd (D-Conn.) said on Monday that high-speed automatic trading programs—which use mathematical models to buy and sell stocks in milliseconds—may have been responsible for the April 6 financial meltdown, when the market crashed nearly 1,000 points in just a few minutes.

While appearing on CBS‘ Face the Nation, Dodd indicated that the momentary crash is an example of Wall Street’s "casino environment" where "finance is getting detached from the real economy."

The senator noted that he and the Securities and Exchange Commission (SEC) will conduct hearings to determine the need for regulations designed to prevent sudden market crashes. He added that the financial overhaul bill currently being debated in Congress could help assist in that effort.

"We need to get in place our bill, have the president sign it, so we have the tools to protect our economy from these kinds of events," Dodd said.

Senator Richard Shelby (R-Ala.), a ranking member of the Senate Banking Committee, said on the same program that "technology has gotten ahead of the regulators," and that safeguards need to be put in place to prevent similar events from occurring.
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  • Isaac Unglaub

    Regarding the 1000 point crash: The ‘masters’ make the rules for the ‘wise’ and the fools !!!

    My advice to the ‘little’ guy (investor): be less greedy to make money for doing nothing. If you don’t know what you are doing, you are playing roulette !!! The casino always wins. Invest your money in something you can trade with when your paper money has become worthless and there is no more food in the stores. An ounce of gold you can trade with any farmer for a bunch of chickens or a pig. Your paper money you can hang up in the toilette. The loudmouths who think they can stand up against the rulers / government in this day and age and start to revolt, will become very surprised what will happen. Remember: in times of crises most of you have to feed a family. That’s why ‘They’ have you by the b….!

  • eddie47d

    JEFF H; good info on the IMF. As the world turns!

    • JeffH

      eddie47d, it’s obvious that we don’t see things through the same eyes, but it is nice to know we can agree, andprobably on more than we care to admit. Thank you.

    • JeffH

      I’ll point out that the IMF = Rothschilds.

      • Isaac Unglaub

        You might be right, Jeff. So whom do we blame? Napoleon loosing the battle at Waterloo? The British who were to stupid / arrogant and almost lost at Waterloo? Or the Prussians who rescued the Brits at Waterloo form the defeat in virtually the last minute? I’m sure you know the history and are aware that it was then the family ‘R…’ took over the control of the Bank of England. And from then on ‘the game’ was already lost for us. For your advice: if and when sh.. hits the fan, this time everybody will be on his own. So secure yourself and your family! But do it smartly !!!

      • JeffH

        …not many even know about the Rothschilds let alone understand what the ultimate plan is. To even think we could be faced with scrapping for food and water just to survive…Mad Max, a reality.

      • Isaac Unglaub

        Hi Jeff, since you seem to know a bit about history and who runs the Feds, see:
        http://www.personalliberty.com/personal-liberty-articles/prying-the-lid-off-the-fed/
        It might interest you.

  • Steve

    Yeah I’d be willing to put all my faith in Dood knowing what the hell he’s talking about, since he was at the helm for this countries worst financial catastrophe since 1929. Yep, if Dood says it, I believe it!

  • JeffH

    Personally, this stinks of the IMF/EU…don’t think for a moment this wasn’t a manipulated crash.

    IMF / WORLD BANK DESTROYING COUNTRIES
    The World Bank – IMF is owned and controlled by NM Rothschild and 30 to 40 of the wealthiest people in the world. For over 150 years they have planned to take the world over through money. The former chief economist of the World Bank, Joe Stiglitz, was fired recently. He pointed out to top executives that every country the IMF/World Bank got involved in ended up with a crashed economy, a destroyed government, and sometimes in flames with riots.

    Before Joe Stiglitz was fired he took a large stack of secret documents out of the World Bank. These secret documents from the World Bank and the International Monetary Fund reveal that the IMF required nations:

    1. to sign secret agreements of 111 items

    2. in which they agreed to sell off their key assets – water, electric, gas, etc.

    3. in which they agreed to take economic steps which are really devastating to the nations involved

    4. in which they pay off the politicians billions of dollars to Swiss bank accounts to do this transfer of a countries fixed assets

    If they do not agree to these steps they are cut-off from all international borrowing. Today if can’t borrow money in the international marketplace, no one can survive, whether you are people or corporations or countries. If that does not work they overthrow the government and plant lies about the former government and/or even rewrite history.
    http://www.unitypublishing.com/Government/IMF.htm

    • JeffH

      IMF Planed Riots

      The IMF/World Bank are systematically tearing nations apart, whether it’s Ecuador or Argentina. It’s not privatization. They steal it from the people and hand it over to the IMF/World Bank. They hand it over, generally to the cronies, like Citibank grabbed half the Argentine banks. British Petroleum grabbed pipelines in Ecuador. Enron grabbed water systems all over the place. The problem is that they are destroying these systems as well. You can’t even get drinking water in Buenos Aires. It is not just a question of the theft. You can’t turn on the tap. It is more than someone getting rich at the public expense. And the IMF just got handed the Great Lakes. They have the sole control over the water supply now. The IMF and the World Bank is 51% owned by the United States Treasury. Indonesia is in flames.

      Every country IMF/World Bank meddling in they destroyed their economy and they ended up in flames. They even plan in the riots. They know that when they squeeze a country and destroy its economy, you get riots in the streets. And they admit that it an IMF riot. Because you have riot, all the capital runs away from your country and that gives the opportunity for the IMF to then add more conditions.

      • http://?? Joe H.

        JeffH,
        Don’t know if you are still active on this, but I heard on the news that Greece is now blaming the U.S. for their problems. Seems they blame the American investment firms for screwing up the Greek investments! Nobody held a gun to their head to make them invest!

  • http://eachstateretaliate.blogspot.com/ Tea Party Tim

    I want to present a scenario. Name the largest company in America…No, the largest….Were you aware that the largest company in America has never been audited? That company is “The Fed”. They control all of the nations financial resources. Now, suppose that “The Fed” has more control than we are aware. Suppose that they are major stock holders and investors in America’s economy. Suppose that they initiated a massive trade to cash out on investments. Now suppose that in a matter of minutes they repurchased the same investments that they had just sold for 70-80% of the value. Viola, instant income.

    We need to audit the Fed.

    • http://?? Joe H.

      TEA party Tim,
      No, we need to get RID of the fed!!!! They are too big for their own good and screwing the economy of this nation daily!!

      • http://eachstateretaliate.blogspot.com/ Tea Party Tim

        Agreed that we need to abolish the fed, but we need to find out what they have, what they have been doing with it and who is involved. I believe that we would be shocked to find out how our politicians became millionares and there could be a money trail from them directly back to the fed.

      • Mary

        I agree absolutely with every point of Tea Party Tim’s (except for his association of the lovely stringed instrument, the viola, in connection with something as nasty as “The Fed”; or perhaps he was referring to my Uncle Walter’s second wife, Viola, who, although she spent heavily, never even got close to what “The Fed” manages to get through. I think he really meant “There it is!”, in the true sense of the French word, “Voila!”)

    • http://victorbarney@embarqmail.com Victor L Barney

      You got my vote!

    • Robin from Arcadia, IN

      There is no doubt whatsoever that the Federal government needs to be accountable to the people! We need to instate the Fair Tax, not a VAT, but the Fair Tax. And then the accountability needs to begin (after the audit of course!)!

    • ER

      I agree, it should have been done a year ago and it needs it worse now

    • http://www.newartsplace.com The Arm

      All companies that I have worked for have an annual audit and don’t banks also have an annual audit? So why shouldn’t the Federal Reserve be audited on an annual basis? I and a lot of the people that I know all think it should be done.

    • Ben Lewis

      If any company in the United States pulled some of the bone head things that this government has done everyone at the top would have been fired as soon as it came to light.

    • George Halepis

      I guess you meant “voila”.

    • George Halepis

      You put it in the wrong place.

    • Phil Channon

      The Fed Has made it’s own rules since the early 30′s??

    • http://tdspoweredbygoogle Nancy Dalrymple

      Hi Tim, you are absolutly right, we need to know where our money goes and how it is spent and what countrys we are letting use our money and what ones are not giving back. I know most of our moneys are being used for out of country favors etc. We as a people should know more about he structure of our country and who is running what. MOst people are to busy with work and tv to give a dam about what is realy important and they wait until they are old to take intrest in what the gov, is doing with the money they put into the kitty. too many forigneers running this country and to many scams. I pray the Lord comes back and pulls the rug out from under them.Peace!

    • bob

      My thinking is that if it all began with one trader, his initial trade was a pre arranged signal to others to force the Market down, profit on the short side, then again on the rebound.

      A Similar scenario was recently revealed in the Gold/Silver markets.It was caught in real time, regulators notified, SURPRISE, nothing done.

      It’s no secret that the Banks have been showing record profits regardless of Market conditions. The markets are being Manipulated by the Banks for profit because no one is doing anythin about the hoarding of capital that has been going on ever since they received the TARP funds. I suspect that is exactly how they were able to pay the TARP back so quickly

    • connie

      i AGEE WITH THE AUDIT. HALF OF THOSE GUY NEVER PAID THEIR TAXES THEY ARE NOT AT ALL TRUSTWORTHY….. AND ;ALL THE MONEY THEY ARE TAKING AND PUTTING IN THEIR OWN POCKETS WE HAVE TO PAY FOR. YES YES,,,,AUDIT AUDIT……

    • David

      That’s what many of us think. And we have been supporting Ron Paul’s call to audit the Fed.

      • David

        Auditing is the first step to exposing this massive Ponzi scheme. With light shed on this mess we can then start dismantling it piece at a time. Wow no unlimited monies, no market for corrupt practices.

    • Ursula Bcekmann

      Pardon my ignorance, but isn’t this like the “Insider-trading” that Martha Stewart went to jail for. Round ‘em up and lock /em up.

    • Carol

      If it would accomplish something it would be great but do you believe the American People would ever hear the truth. I believe all of the Government Employee’s, Elected and hired should be taking a cut in pay along with the rest of us. There should be a pay freeze until this administration is out of office.They have already shown they do not know what to do. It’s CRAZY!!!!! I didn’t vote for Obama and one of the reasons is he did not have enough experience to to the job. Look at all of the Czar’s we are paying for to assist him and the Czar’s are radicals!!!

    • Delores Smith

      TEA PARTY TIM,
      I agree about auditing the Fed. Bob Livingston wrote a terrific article about the Fed. I learned so much from his info. Everyone needs to find out who is on the Federal Reserve and start digging for corruption in their backgrounds. If the corruption is there…and it is…verify it at least three times. Contact your rep. and senators. Post the information anywhere and everywhere. When people are corrupt, you have to discredit them before you can accomplish anything. Thanks. Delores Smith

  • CUZIN ERN

    A computer glitch may have caused the stock market to drop; would one think for a moment that Fannie and Freddie pushed too many buttons that also created a deficit we can’t consume in many lifetimes too??/

    Why does the blame game always include those who get the finger pointed at them when the finger pointer was the Culprit????

  • eddie47d

    Most of you ignored the original comment that “tecnology got ahead of regulations”. That’s a dangerous scenerio for Wall St. for their gambling can effect whole nations.I don’t think we’ve seen the last of it. Tech can be a marvelous blessing and sometimes a curse. It’s sometimes hard to keep up with since a product is obsolete within a year and sometimes less. Technology controls our lives more than we know. How do we keep on top of these new products and how we do business?

  • http://victorbarney@embarqmail.com Victor L Barney

    If you believe Senate Banking Committee Chairman Chris Dodd (D-Conn.), then you also must believe that Obama is a legitimate President of the United States, even if the Set-Apart Bible says that he is not(Deuteronomy 17:15)!

  • http://gmail i41

    You forgot to add Spittle Mouth Fwanks, Washington’s elmer fudd. The only thing we new elmer was hunting wabbits, Blarney is always lying, his jaws are moving. With Blarneys round mouth you know it wasn’t from just three squares!

  • Robin from Arcadia, IN

    Why would anyone want to believe anything that comes out of Washington? They are the ones that need to be watched…

  • D

    Angel is not that far off. FDR (the king of socialists) had something like 38,000 political opponents of his policys locked up in prison!

    And why in the world is the media NOT talking about Obamas SSN situation? This is a HUGE story!

    • Time

      D – Thats been removed from Google serchs for some reason, don’t you just want to know why?

      Our Media is so bent that it hurts to watch it. After reading it you want to hit yourself in the head.

  • angel-wanna-be

    “We need to get in place our bill, have the president sign it, so we have the tools to protect our economy from these kinds of events,” Dodd said. (copy and pasted from article)

    If our dear Government protects us any more, we’ll be in solitary confinement!

  • Save America Susie

    D–Yes, and I can’t understand why they were in such a hurry to pass that HC Bill, unless they knew their time in office was going to be limited! Think about that one. There were so few votes to pass it, It almost passed by executive order! Finally passed under the banner of financial reconciliation, just because the IRS will be in CONTROL of it. That’s a stretch!

  • D

    Can someeone please build a time machine and and send this country to Novemeber 2010. This bunch of Statists need to go and go fast!

    I remember the taped recording of VP Joe telling his liberal left right after the election “this is all going look crazy but stand behind it and then you will see how it all works” Sound familiar? Sounds a bit like Harry Pelosi saying “we need to pass the healthcare bill so the people can see what’s in it”. I have to believe that there are a few Dems that realize what is going on!?

    These idiots are socialists! Change you can believe in… Ha! More like “vote for my socialism so you can see how it works”

  • Time

    Dodd, is with out question one of the most stupid freaks of nature who stands upright and walks.
    Why would anyone want to listen to anything he has to say about anything.
    What I really can’t grasp is why he has been voted into office so many times. Just like Chuckie Schummer these puzzels leave me with out words,
    I guess the people who vote for them are more so stupid that these two twinkies.

    • calhar

      Your analysis of Dodd is probably fair.However I do believe he is right on high speed internet trading.This can throw the market out of its normal sequence very fast under certain conditions.This has got to be throtled down.It amounts to no more than stealing no matter how you look at it.Advocates of this kind of trading are basicaly thieves.

    • Pat R

      It’s called “Democrat” The people who keep voting him in are “Democrats” They only vote “Democrat!!

  • s c

    Leave it to someone like Dodd to say that Wall Street is detached [and imply that Uncle Scam is doing his job]. Mr. Dodd, who watches the watchers?
    There is no way this government can escape the watchful eye of the American people. The people are watching you, Mr. Dodd.
    We’re watching Baaney Fwank and his ‘fwiends’ who demand impunity while they get rich at our expense and hopelessly addicted to power. We’re watching this gang of thugs. What we see is beyond ugly.
    This government refuses to admit its role in “blessing” derivatives. Only a government gone mad could dare to claim innocence.
    Dodd, Fwank, Soros, and even Gates have much to answer for in this contrived disaster. It makes no difference what your political affiliation is. If you took part in this economic abomination, you are a parasitic, anti-freedom, career criminal. Your turn in the barrel, guys and gals, is coming.

    • Kim

      To SC:

      The importance to the Tracks of Life….
      Look at the Direction…
      Look at the patterns that those prints left behind.
      Where they good heavy tracks to carry the burden for the sake of another? Or….
      Where they tracks to bury and leave too many others behind?

      Well thought out, well said….I like your emphasis to warn, politician to be watchful, accountable for their conscious, deeds and public works of purpose.

      I want to back you up, for you are so right by adding in …
      That is a two way accountable street though. Be watchful, informed and an intellectual as an American to show your awareness to vote smart! I am counting on all of you out there…people! Across this great nation…that I don’t even know…for which I pray for daily…Please,please for me… for unborn children, children to adolescences, young adults to “mature”adults, to our precious elderly and to those that put themselves in harm way to serve unconditionally in crisis or battle knowingly sacrificing their own life for the purpose to help out the better of mankind… and for yourself, please…VOTE SMART!!!

      Listen, read and learn to what is being said! How it is being said? To whom it is said to or with whom? What is not, being said between the lines! What the pays off are? Then and only after being informed to doing your part of collecting, researching and being an informed voter….VOTE SMART! I am counting on all of you to see, to learn, to follow the truth to those patterns of personality by their actions to hold them and yourself accountable to the office that was intended to serve it’s people…again I warn…Vote Smart.

    • Save America Susie

      Speaking of DODD…How ironic he is the Banking Committee Chair person…Here’s an interesting blue link you may wish to check out about who took the MOST MONEY from Freddie & Fannie:

      TOP 3 = DODD, OBAMA & KERRY!

      REID came in 11th and Pelosi #18. McCain was way down the list at #62 and did not even come close in comparison.

      http://www.opensecrets.org/news/2008/09/update-fannie-mae-and-freddie.html

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