First I heard about this story from my dad and then later on in the day I got an e-mail from Ross about it.
A few days back (September 8th) a news article in the archive a Florida newspaper started getting an unexpectedly large amount of hits for some reason. This would usually not be a big deal, however it was an article about United Airlines filing for bankruptcy from a couple months back. So now it’s a big deal.
The large amount of hits caused it to go the the “Popular News” section of the web site. Because of that, it was picked up by the Google News crawler. The news crawler puts the article on the Google News site with the current date on it and the article itself doesn’t have a date with it.
This eventually got itself onto the financial news service of a stock research firm that publishes reports on the Bloomberg L.P. Now we’ve really got a problem.
Here is an excerpt from an informative writeup by Steven J Klein @ mac.com:
8. On Monday, September 8, at approximately 10:45AM, a headline from the report flashed across Bloomberg screens.
9. In the next 15 minutes, UAL shares in UAL dropped from almost $12.50/share to just $3, before trading was halted. At least one block of 100 shares traded at 1 cent per share, though that trade was later voided.
He also brings up a good point that this could very easily be a form of market manipulation. All spammers would have to do is send out millions of e-mails with the link to a story like this in the body, if just a small fraction clicks on the story, bam…it’s on the front page and everyone freaks.