The Day The Market Almost Died (Courtesy Of High Frequency Trading)

Tyler Durden's picture

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Tart's picture

liquidity vacuum from toxic liquidity that isn't there when you need it

anonymous_user_000001's picture

The EUR/JPY broke before the equity market, as did the credit mkts. The "glitch" exacerbated the sell off obviously, but the market was already crashing before that. Ironically, the glitch probably brought buyers into the market...wonder if we'd have ended worse had there been no glitch, just gradual but sustained liquidation.

overbet's picture

THIS IS OUTRAGEOUS!!!! These trades stand that are within this range? DOwn 50% sorry that stands?

AAXJ NASDAQ 20.73 82.93 ACN NYSE Group 16.41 65.63 BDT NYSE Group 3.77 15.07 BDV NYSE Group 3.44 13.74 BGS NYSE Group 4.15 16.61 BICK NASDAQ 10.60 42.38 BOE NYSE Group 6.80 27.20 BRO NYSE Group 7.67 30.69 BTF NYSE Group 5.44 21.76 BWP NYSE Group 10.35 41.41 CFI NYSE Group 5.19 20.75 CGW NYSE Group 6.78 27.12 CHTP NASDAQ 1.47 5.89 CII NYSE Group 5.51 22.05 CLW NYSE Group 23.62 94.48 CNP NYSE Group 5.54 22.16 CNR NYSE Group 0.86 3.44 CSA NYSE Group 2.62 10.46 CSM NYSE Group 20.67 82.69 CTL NYSE Group 13.40 53.60 CUT NYSE Group 7.04 28.18 CVO NYSE Group 2.94 11.78 CVY NYSE Group 7.01 28.03 CWB NYSE Group 15.00 60.00 CWI NYSE Group 11.20 44.82 CYS NYSE Group 4.91 19.65 DES NYSE Group 17.02 68.10 DKP NYSE Group 8.08 32.32 DLN NYSE Group 16.62 66.46 DNP NYSE Group 3.54 14.14 DOG NYSE Group 20.46 81.84 DTN NYSE Group 16.69 66.77 DVY NYSE Group 17.94 71.78 DWM NYSE Group 16.29 65.15 DWX NYSE Group 18.66 74.66 DZK NYSE Group 19.99 79.97 EBIX NASDAQ 6.04 24.18 ECH NYSE Group 21.55 86.21 EEB NYSE Group 15.03 60.11 EES NYSE Group 17.88 71.52 EFG NYSE Group 19.96 79.82 EFO NYSE Group 24.49 97.97 EFV NYSE Group 17.56 70.26 ELG NYSE Group 19.78 79.14 ELR NYSE Group 20.96 83.84 EMG NYSE Group 24.37 97.49 EMM NYSE Group 20.41 81.63 ENY NYSE Group 6.57 26.27 EOS NYSE Group 4.96 19.82 EPI NYSE Group 8.58 34.30 EPP NYSE Group 15.01 60.03 ETY NYSE Group 4.78 19.10 EVF NYSE Group 2.56 10.26 EWK NYSE Group 4.51 18.03 EWX NYSE Group 18.00 72.00 EXC NYSE Group 16.52 66.10 EXG NYSE Group 4.34 17.38 EXLS NASDAQ 6.42 25.70 EXP NYSE Group 12.06 48.26 EZPW NASDAQ 7.43 29.73 FAB NYSE Group 10.12 40.48 FAX NYSE Group 2.39 9.55 FBT NYSE Group 12.94 51.76 FCG NYSE Group 6.57 26.29 FDV NYSE Group 8.36 33.42 FEX NYSE Group 9.70 38.78 FGD NYSE Group 8.21 32.85 FNI NYSE Group 8.21 32.85 FNX NYSE Group 11.20 44.80 FPT NYSE Group 5.23 20.93 FTA NYSE Group 9.48 37.92 FTY NYSE Group 11.96 47.82 FVD NYSE Group 5.44 21.76 FXD NYSE Group 6.60 26.40 FXH NYSE Group 9.05 36.21 FXL NYSE Group 7.17 28.67 FXO NYSE Group 5.20 20.78 FXU NYSE Group 6.12 24.50 FXZ NYSE Group 7.91 31.63 FYX NYSE Group 10.46 41.82 G NYSE Group 6.36 25.42 GCV NYSE Group 2.53 10.13 GEC NYSE Group 8.78 35.10 GFW NYSE Group 8.59 34.37 GII NYSE Group 15.03 60.11 GIM NYSE Group 3.76 15.04 GLAD NASDAQ 4.20 16.80 GLL NYSE Group 16.77 67.07 GMF NYSE Group 28.45 113.81 GWX NYSE Group 9.92 39.68 HANS NASDAQ 16.75 67.01 HAP NYSE Group 12.25 48.99 HEDJ NYSE Group 17.84 71.34 HHH NYSE Group 22.50 90.00 HNT NYSE Group 9.41 37.65 HSTM NASDAQ 1.87 7.49 HTGC NASDAQ 3.71 14.83 HTS NYSE Group 9.67 38.69 IAK NYSE Group 11.44 45.76 IAT NYSE Group 9.78 39.14 IDE NYSE Group 6.18 24.72 IEZ NYSE Group 17.05 68.19 IGM NYSE Group 21.06 84.26 IGN NYSE Group 11.02 44.10 IGV NYSE Group 18.51 74.05 IGV NYSE Group 18.51 74.05 IGW NYSE Group 18.46 73.82 IHE NYSE Group 22.72 90.88 IHF NYSE Group 19.54 78.16 IHI NYSE Group 22.97 91.89 IJH NYSE Group 30.46 121.82 IJJ NYSE Group 27.73 110.91 IJK NYSE Group 32.68 130.74 IJR NYSE Group 23.48 93.94 IJS NYSE Group 25.38 101.50 IJT NYSE Group 24.11 96.43 IPG NYSE Group 3.10 12.38 IPN NYSE Group 9.28 37.14 IPXL NASDAQ 7.10 28.42 ISI NYSE Group 20.35 81.41 ITA NYSE Group 22.16 88.62 ITC NYSE Group 20.36 81.44 IVE NYSE Group 21.65 86.59 IVW NYSE Group 22.86 91.44 IWA NYSE Group 6.52 26.10 IWB NYSE Group 24.70 98.82 IWD NYSE Group 23.40 93.58 IWF NYSE Group 19.88 79.52 IWN NYSE Group 25.09 100.35 IWP NYSE Group 18.66 74.66 IWR NYSE Group 34.45 137.81 IWS NYSE Group 15.60 62.42 IWV NYSE Group 26.39 105.57 IWW NYSE Group 30.94 123.76 IWX NYSE Group 10.36 41.46 IWZ NYSE Group 16.29 65.17 IXC NYSE Group 13.00 52.00 IXG NYSE Group 16.74 66.94 IXJ NYSE Group 19.42 77.66 IXP NYSE Group 19.44 77.78 IYC NYSE Group 23.92 95.70 IYE NYSE Group 12.78 51.14 IYH NYSE Group 24.86 99.42 IYK NYSE Group 22.66 90.66 IYY NYSE Group 22.32 89.30 JKD NYSE Group 25.88 103.50 JKE NYSE Group 22.87 91.47 JKF NYSE Group 21.39 85.57 JKK NYSE Group 26.82 107.26 JPM.PRS NYSE Group 8.76 35.04 JPM.PRX NYSE Group 8.32 33.30 JRO NYSE Group 4.47 17.87 KXI NYSE Group 22.21 88.83 LEA NYSE Group 28.38 113.50 LGI NYSE Group 5.75 22.99 LINE NASDAQ 8.82 35.28 MCN NYSE Group 3.24 12.98 MDD NYSE Group 10.04 40.16 MFM NYSE Group 2.74 10.94 MGU NYSE Group 5.62 22.48 MSPD NASDAQ 3.50 14.02 NFO NYSE Group 10.89 43.55 NHS NYSE Group 4.50 18.00 NLR NYSE Group 7.95 31.79 NTL NYSE Group 7.96 31.86 OKS NYSE Group 22.20 88.80 ONEQ NASDAQ 36.60 146.38 OPNT NASDAQ 6.16 24.64 OXM NYSE Group 7.71 30.85 PBJ NYSE Group 6.27 25.09 PBP NYSE Group 8.25 33.01 PBS NYSE Group 5.06 20.26 PBW NYSE Group 3.56 14.22 PDP NYSE Group 7.78 31.10 PEJ NYSE Group 6.14 24.58 PEY NYSE Group 3.25 12.99 PEZ NYSE Group 8.80 35.22 PFM NYSE Group 5.06 20.24 PGH NYSE Group 3.94 15.74 PHO NYSE Group 6.70 26.82 PIC NYSE Group 5.87 23.49 PID NYSE Group 5.21 20.83 PIE NYSE Group 5.53 22.13 PIN NYSE Group 8.36 33.42 PIV NYSE Group 4.59 18.35 PJM NYSE Group 8.15 32.61 PJP NYSE Group 7.60 30.42 PKW NYSE Group 8.77 35.07 PNQI NASDAQ 10.42 41.66 PPCO NASDAQ 1.31 5.23 PQBW NASDAQ 8.42 33.66 PRF NYSE Group 19.80 79.22 PRFZ NASDAQ 22.00 88.02 PSI NYSE Group 5.20 20.80 PSJ NYSE Group 8.59 34.37 PUW NYSE Group 9.20 36.80 PVR NYSE Group 7.95 31.81 PVX NYSE Group 2.82 11.28 PWB NYSE Group 5.58 22.30 PWJ NYSE Group 7.18 28.70 PWO NYSE Group 17.56 70.22 PWV NYSE Group 6.87 27.49 PWY NYSE Group 5.51 22.05 PXI NYSE Group 10.85 43.41 PXQ NYSE Group 7.72 30.86 PZZ NASDAQ 2.73 10.93 QCLN NASDAQ 5.82 23.28 QID NYSE Group 7.23 28.93 QQEW NASDAQ 8.11 32.45 QQEW NASDAQ 8.11 32.45 QTEC NASDAQ 8.39 33.55 RFG NYSE Group 24.40 97.58 RFL NYSE Group 5.47 21.87 RFV NYSE Group 12.16 48.66 RHS NYSE Group 21.02 84.10 RIT NYSE Group 2.97 11.87 RPG NYSE Group 13.78 55.10 RPV NYSE Group 10.30 41.20 RQI NYSE Group 2.67 10.69 RSP NYSE Group 16.33 65.31 RSU NYSE Group 13.20 52.80 RSW NYSE Group 21.60 86.40 RWJ NYSE Group 11.37 45.47 RWL NYSE Group 8.56 34.22 RWW NYSE Group 12.06 48.22 RXI NYSE Group 18.46 73.82 RYF NYSE Group 10.27 41.09 RZV NYSE Group 14.38 57.50 SAM NYSE Group 22.72 90.88 SCHA NYSE Group 11.65 46.61 SCHG NYSE Group 10.50 42.02 SCHV NYSE Group 10.34 41.34 SCHX NYSE Group 10.60 42.38 SCJ NYSE Group 17.29 69.15 SDD NYSE Group 8.67 34.69 SDK NYSE Group 9.33 37.31 SDOW NYSE Group 26.94 107.78 SDOW NYSE Group 26.94 107.78 SFK NYSE Group 13.47 53.87 SFK NYSE Group 13.47 53.87 SIJ NYSE Group 8.16 32.62 SJF NYSE Group 18.63 74.53 SORL NASDAQ 3.50 14.02 SOXL NYSE Group 13.55 54.19 SRTY NYSE Group 21.54 86.16 SRTY NYSE Group 21.54 86.16 SWH NYSE Group 16.33 65.31 TEI NYSE Group 5.44 21.76 TLP NYSE Group 10.66 42.62 TYP NYSE Group 3.50 14.00 UKW NYSE Group 13.83 55.31 UPW NYSE Group 14.09 56.35 URE NYSE Group 15.66 62.62 URTY NYSE Group 42.76 171.02 UXI NYSE Group 13.86 55.46 VALU NASDAQ 8.50 33.98 VB NYSE Group 24.52 98.10 VBK NYSE Group 25.18 100.70 VBR NYSE Group 23.52 94.08 VCR NYSE Group 20.56 82.26 VDC NYSE Group 26.91 107.65 VFH NYSE Group 12.35 49.41 VHT NYSE Group 21.47 85.87 VIS NYSE Group 22.20 88.78 VO NYSE Group 24.97 99.89 VOE NYSE Group 18.81 75.23 VOX NYSE Group 21.66 86.64 VTA NYSE Group 4.38 17.54 VTI NYSE Group 22.80 91.22 VTV NYSE Group 19.32 77.26 VUG NYSE Group 21.18 84.72 VXZ NYSE Group 32.76 131.06 VYM NYSE Group 15.28 61.10 WIN NASDAQ 4.14 16.54 WOOD NASDAQ 15.65 62.61 WSII NASDAQ 4.47 17.89 WWON NASDAQ 6.22 24.88 XGC NYSE Group 7.71 30.85 XLFS NASDAQ 10.36 41.44 XLIS NASDAQ 10.26 41.04 XLPS NASDAQ 10.52 42.08 XLVS NASDAQ 10.02 40.06 XLYS NASDAQ 10.04 40.14 XPH NYSE Group 16.24 64.96 XRO NYSE Group 8.48 33.94 XSD NYSE Group 17.88 71.54
overbet's picture

Nice formating, here this is easier to see

click the xls file to open

Fish Gone Bad's picture

It took a long time for the market to get rise this high, it will take some time to destroy this market as well.  There is a lot of money to still be made in the losses of others.  Bernanke once said that the Fed had enough money that it could buy the entire US stock market.  The tidal forces of money are now leaving the stock markets and going into something else.  It will be interesting to see if the Fed can support this collapsing house of cards.

MarketTruth's picture

The Fed has UNLIMITED money, it is simply 'printed' out of thin air. The Fed could buy the entire universe as we know it.

Of course then those dollars in your pocket become worthless and you'll need a wheel barrel full to buy a loaf of bread.

The USA needs to end the private member owned Federal Reserve. Their corrupt and ongoing illegal activities must be stopped or USA citizens and those doomed to have US dollars will suffer. The US dollar has already lost over 95% of its buying power (value) since its inception, and obviously this breaks the mandate of one of their mandates. Steady employment is another mandate, and they are failing there as well.


f1aw1essv1ctory's picture

Skynet's cooling fan inadvertently sucked a few nearby green shoots into its mainframe causing a minor "glitch."

Jim Cramer's picture

I confess.  It was I Jim Cramer who entered an order for Proctor and Gamble and accidentally hit b for billion instead of m for million.  I know you must ask yourself how then it is that a 20% drop in this one stock can affect the Dow to the tune of a 1000 points, and the S&P for 100 and the Nasdaq and Oil and Gold and blah blah blah.  It's because Proctor and Gamble is the only stock that backs all these markets thus it cratering the whole of all markets by my little "typo".  Get your head around that one.  BOOYAAH!

Missing_Link's picture

Oh, no, Jim!  You bastard!

That just makes me hit the "House of Pain" button over and over again  ...

chindit13's picture

Is that Proctologist & Gambler?

Howard_Beale's picture

Excellent post Tyler. That idiotic B instead of M story is the most ludicrous piece of drivel I have EVER heard. The focus on P&G was hysterical folly on CNBS. As I posted over on the BP thread, it is impossible to short a billion S&P contracts unless you are China and you have your Treasuries posted with the CME. And this was an S&P debacle. And if it was to short a billion Spy's--nah, pure bullshit.

There is no doubt that today's market action was everything you say. None, Zero, Zilch. No bug in the system.


Missing_Link's picture

That idiotic B instead of M story is the most ludicrous piece of drivel I have EVER heard.

I laughed out loud the moment I heard that.  How stupid does CNBC think we are?

Careless Whisper's picture

yeah that was pretty funny.

oh, and where were all those "market makers" adding their so called liquidity?

but how do we know that a black box didn't engineer the whole thing INTENTIONALLY? i wasn't quick enough to buy aapl at 200 or f at 10.60 but those black boxes could.



FEDbuster's picture

Thank goodness it wasn't a "Tr", boooo yaaaah!

Howard_Beale's picture

Here's a commerative mug for today! Buy it. Maybe they won't go down for hours next week! All funds go to ZH! me so you can post an image for me from time to time...

howardbeale72 at gmail dot com

berlinjames02's picture

Myth Busters time: Let's assume the 'Billion theory" is true.

Perhaps it was an error in written communication. How are the numbers put into the system? By typing billion (or million) or using numbers? (They're most likely put in using zeros, which could create the error. However, the trader would check the order to before clicking 'send' in this case.

Perhaps it was an error in verbal communication. In this case, the trader in the pits receives a call from his boss.

"Hey, I want you to execute a sell order for 1 billion shares of PG".

Trader replies: "1 billion? You sure it's 1 billion and not million?"

Boss: "I repeat- Billion"

Trader: "OK. I just wanted to make sure... this trade will be ~15% of total daily volume. Are you sure it's PG and not C?"

Boss: "I repeat- PG. Now execute the damn trade."

Seems to me this myth is: BUSTED

DaveyJones's picture

Great post, great comment Howard. I was in court all morning and came out to the news. I then heard the "BM" excuse and thought it added up to what its initials truly stand for. Being severely market ignorant compared to most of you, I then tried to get on ZH for most of the day. It's a relief to finally get through the door and hear some sanity    

Cyan Lite's picture

Computer "glitch"?  Yeah, but I still think this was capitulation/panic selling.  The retail investor is not coming back.  401k's will be dumped starting tomorrow.

Greater Fool's picture

Funnily, I put in orders to take bear-market rally profits in my 401(k) at about 11 this morning. Orders don't execute until the end of the day, though, so I got torched anyway. Good thing I'm under 40.

dumpster's picture

well it wont be long before your 401 will be part of the great experiment of government .

best to sell now get some gold ,


DoChenRollingBearing's picture

+ $1206

I'm 54 and cashed in my IRA in 2008, took my hits (taxes and penalties), but the money is now all mine.

And, yes, to second dumpster, start loading up on gold.

chumbawamba's picture

I cashed out my IRA in 2008 as well, but I didn't take any hit because it was my fucking money.  Took the part that my wife didn't pilfer on that month's mortgage and expenses and put it all into gold and silver.  It was satisfying.

Today was satisfying.  Today was like when your girlfriend swallows and you don't even have to ask.

I am Chumbawamba.

velobabe's picture

Today was like when your girlfriend swallows and you don't even have to ask.

you have a wife and a girlfriend that swallows.


RockyRacoon's picture

Good going.  I dumped my IRA in 1999.  Took the hit and started buying gold/silver.  Sure was excruciating back then.  I agonized over buying gold at $400.  I knew someone would have me committed to an asylum.   Kept buying....

jedwards's picture

Nice, you got a 300% return over 11 years, which is a 10% gain every year.  Better than sticking it in a mutual fund, that's for sure!

nufio's picture

I was verry happy to find out that my company provides a brokerage link account in my 401k. Now i can buy puts with my retirement money!

hack3434's picture

I got the following from my brokerage account when I tried to cash in:  

"The reason for the delay in the cancellation was that we were experiencing delays from our market makers on the reporting of executed and cancelled trades. This problem has since been rectified." 

chindit13's picture

"Rectified" seems a wholly appropriate term.  As in rectum.  As in taking up the butt.  Broken trades my arse.

i.knoknot's picture

good eye! that one went right by!

rmsnickers's picture

Not sure what you are invested in but I think torched would have been appropriate if we closed down 1k.  The fact that we saw a 650 point swing back up was good to close out the day and give us a chance to get out before this thing drops for good.  Good luck.

Thunder44's picture

I agree, and props to Zerohedge for staying on HFT.

stewie's picture

Absolutely, and I want to see on his campaign ad poster him and that big rubber glove giving it to Blankfein. Go Tyler, go wild :o) 

Hulk's picture

We will need to see a birth certificate.. On second thought, I guess we won't!

Duuude's picture

I agree. Thanks Tyler.

Rusty Shorts's picture

"If I weren't a tad close to the issue, I'd tell you not to leave the house"

 - Brian Williams


I hope everyone is ready.


CD, thanks for the links, but, "they" have already pulled the videos, perhaps you can fill me in.


CD's picture

I've long wondered why they bother to put up the clips in the first place, if they take them off after just a few hours.

Kaufmann interview is detailed in Tyler's post about him yesterday, the vid is (was) just a graphic illustration of how haggard and stressed out the guy was. Considering what had just gone down, I am not surprised, but he did seem both honest as well as painstakingly reasonable (though I thought I imagined much more aggressive emotions behind his cool, measured stance on the need to thoroughly examine the market structure and put in place effective regulation as soon as possible).

I did not have time to watch the Roubini et al conversation, too much going on. Just wanted to keep the ball rolling with current news on the topic that did not mention fat fingers or the ubiquitous 'technical glitch'.

MsCreant's picture

Rusty, CD, I was blown away by the Letterman show too, saw it aired. Letterman is a tool for the corporation, but I swear he slips in material here and there that is profoundly subversive. He recently had the scientist on that "discovered" the floating island of waste plastic in the ocean. 

I am put in mind of "V" for Vendetta. Could be wishful thinking though. Thanks for talking about Letterman. 

MaxPower's picture


When the things we've been reading about and agonizing over here at ZH start coming out of a network news anchor's mouth on Dave Letterman's show, we have certainly passed the point of no return.

V for Vendetta is one of my all-time favorites. The dialogue is amazing. Between this film and the Matrix, I'm thinking perhaps we should call the Wachowski's to come and fix this mess. They seem to have grasped many of our existential issues long before many of us became aware of them...


overbet's picture

Here is the worse part. The HFT quants who f up will get most or a lot of their errors busted but the retail trader who got stopped out gets screwed.

Jim Cramer's picture



This is directly from your president.  We are making them whole because we care for you.



Thunder44's picture

Yeah i'm sure some retail investors took it in the keister today, you know when we were down -900+ stops were closing accounts out.

Mortimer Duke's picture

Absolutely correct...Way to go NASDAQ. Thanks for creating more moral hazard than Benji and Tim Tim. downside for the HF traders when their algos go Frankenstein on them. Geez, I wonder how reckless their program trading will become now given their downside is limited.