• Sprott Money
    04/29/2016 - 05:58
    There is unfortunately no basis for renewed optimism that this current litigation will have any meaningful impact on precious metals manipulation – with respect to either silver or gold.

Final Berserk Algo Bill To Knight - $440 Million; Stock Implodes

Tyler Durden's picture




 

While JPMorgan thought it was $170mm, we said last night the number was notably higher - and sure enough, via Bloomberg:

  • *KNIGHT SAYS TRADING OUT OF POSITION YIELDED $440M PRETAX LOSS
  • *KNIGHT SEEKS OPTIONS TO BOOST 'SEVERELY' HURT CAPITAL POSITION
  • *KNIGHT CAPITAL PURSUING STRATEGIC, FINANCING ALTERNATIVES

KCG is down another 50% this morning to $3.45! And here is what we explicitly warned yesterday: "In  other words, with  Knight losing about $300 million in market cap today,  investors are  speculating that the net loss to the firm will be just  that as it has  to foot the bill. Considering the volume and breadth of  the impaired  universe, this will likely be very big underestimation of  just what the  final bill will be to Knight." Sure enough...

Knight Capital Group Provides Update Regarding August 1st Disruption To Routing In NYSE-listed Securities

PR Newswire

JERSEY CITY, N.J., Aug. 2, 2012

JERSEY CITY, N.J., Aug. 2, 2012 /PRNewswire/ -- Knight Capital Group, Inc. (NYSE Euronext: KCG) today provided an update on the August 1, 2012 disruption to routing in NYSE-listed securities.

As previously disclosed, Knight experienced a technology issue at the open of trading at the NYSE yesterday, August 1st. This issue was related to Knight's installation of trading software and resulted in Knight sending numerous erroneous orders in NYSE-listed securities into the market. This software has been removed from the company's systems.

 

Clients were not negatively affected by the erroneous orders, and the software issue was limited to the routing of certain listed stocks to NYSE.

 

Knight has traded out of its entire erroneous trade position, which has resulted in a realized pre-tax loss of approximately $440 million. Although the company's capital base has been severely impacted, the company's broker/dealer subsidiaries are in full compliance with their net capital requirements. Knight will continue its trading and market making activities at the commencement of trading today. The company is actively pursuing its strategic and financing alternatives to strengthen its capital base.

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Thu, 08/02/2012 - 08:23 | 2671509 LULZBank
LULZBank's picture

KCG - kamikaze Capital Group Bitchezz!!!

Thu, 08/02/2012 - 08:24 | 2671513 GetZeeGold
GetZeeGold's picture

 

 

Oh come on.....even Muppets get mulligans.

 

Thu, 08/02/2012 - 08:27 | 2671532 wang (not verified)
Thu, 08/02/2012 - 08:29 | 2671543 GetZeeGold
GetZeeGold's picture

 

 

Go on without me.....let me know what happens.

 

Thu, 08/02/2012 - 08:37 | 2671554 BaBaBouy
BaBaBouy's picture

Fucking Out Of Control CASINO ???

WHERE Are the Fecking Regulators ???

Thu, 08/02/2012 - 08:41 | 2671606 tocointhephrase
tocointhephrase's picture

MDB, Robo? Come on make me laugh...one sec.....MUWHAHAHAHAHAHAAAA

Thu, 08/02/2012 - 08:52 | 2671656 veyron
veyron's picture

Down  nearly 60%:

2.82 -4.12 (-59.37%)

Thu, 08/02/2012 - 09:02 | 2671716 bdc63
bdc63's picture

what a knightmare

Thu, 08/02/2012 - 09:11 | 2671758 whstlblwr
whstlblwr's picture

ZH has the best financial reporting on the web. But if you do a Google search for Knight Capital, try to find ZH. What else is Google blacking out? Fuck you Google.

Thu, 08/02/2012 - 09:44 | 2671928 Thomas
Thomas's picture

Knight has lost 60% of its market cap. As ET would say, ouuuuuuch.

Thu, 08/02/2012 - 10:01 | 2672011 Manthong
Manthong's picture

He who lives by the algo, dies by the algo.

Who’s next?

Thu, 08/02/2012 - 10:51 | 2672227 Bananamerican
Bananamerican's picture

"There has been a disturbance in the Casino..."

knighty night niggaz!

Thu, 08/02/2012 - 10:40 | 2672193 Born-Again Bankster
Born-Again Bankster's picture

Those KCG puts are up 18x since I bought them after watching that damn ZH video with those guys saying, "whoever is doing this is losing hundreds of millions of dollars". Thanks guys...fahking awesome.

Thu, 08/02/2012 - 11:46 | 2672464 KowPie
KowPie's picture

@whstlblwr: ...try to find ZH...

 

...the bottom of the 5th page of search returns:

"

The Dark Pool Knight Capital Plummets | ZeroHedge www.zerohedge.com/news/dark-pool-knight-falls

1 day ago – Forget Bane, Knight is going dark:*KNIGHT CAPITAL EXPERIENCING DELAY IN PROCESSING STOCK ORDERS*KNIGHT CITES ...

"

Thu, 08/02/2012 - 09:08 | 2671741 TheFourthStooge-ing
TheFourthStooge-ing's picture

.

Fucking Out Of Control CASINO ???

WHERE Are the Fecking Regulators ???

They are investigating bureaucratmidgettrannygoatsex.com quite thoroughly.

Thu, 08/02/2012 - 10:00 | 2672010 Buckaroo Banzai
Buckaroo Banzai's picture

The regulators are too busy raiding raw milk suppliers. Now THAT'S fraud!

Thu, 08/02/2012 - 10:18 | 2672091 Tijuana Donkey Show
Tijuana Donkey Show's picture

Can't have people eating something that might improve their health and doesn't come in a chargable pill form. We also need to crackdown on medical marijuana, as it might challenge some other pills, even if people in a "democracy" "voted" for it in an open election. America is big on only offering two choices on an issue: big agricuture or starve, pills or death, republican or democrat. 

 

P.S. Raw milk is AWESOME! Get some.

Thu, 08/02/2012 - 08:50 | 2671646 max2205
max2205's picture

China hacked into Knight and well the rest is history....

Thu, 08/02/2012 - 09:00 | 2671710 g speed
g speed's picture

not---IT guys watching porn for 45 mins and not watching the tape---lol

Thu, 08/02/2012 - 11:07 | 2672297 Umh
Umh's picture

Front running routine choked.

Thu, 08/02/2012 - 09:07 | 2671740 ToNYC
ToNYC's picture

V. (Vlad the Virtual) Lenin was spot on about given enough digital rope that Capitalism (divorced from Socialism completely) will invent algos and stuxnet themselves.

Thu, 08/02/2012 - 09:26 | 2671822 DeadFred
DeadFred's picture

I believe he said "The Capitalists will sell us the Cat5e cable with which we will hang them"

Thu, 08/02/2012 - 08:56 | 2671676 RiverRoad
RiverRoad's picture

This had nothing to do I suppose with the coincidentally kaput cyber bill in Congress?

Thu, 08/02/2012 - 09:41 | 2671856 phalfa5
phalfa5's picture

In A.D. 2012

War was begining

CEO: What Happen ?

IT Head: Somebody set us up the bomb.

www.youtube.com/watch?v=qltugh-fFgg

Thu, 08/02/2012 - 08:45 | 2671627 I Am Not a Copp...
I Am Not a Copper Top's picture

BWAAAAAAAAHAHAHAHAHAHAHAHAHAHAHAHAHA!!!!!!!!  Serves the bastards right.  Chalk one up for the humans against Skynet.  John Connor will teach us how to smash those metal motherfuckers!!!!!!

Thu, 08/02/2012 - 08:53 | 2671660 orangedrinkandchips
orangedrinkandchips's picture

"and were gonna smomke an ounce to that....G's up, Knights down...."

Thu, 08/02/2012 - 08:58 | 2671695 spankthebernank
spankthebernank's picture

What better way to thin the market making herd than by attacking Knight. Surely the hit was put out by Goldman or the morgue. The less players, the more control.

Thu, 08/02/2012 - 10:14 | 2672074 Panafrican Funk...
Panafrican Funktron Robot's picture

Knight had just recently acquired another dud (Penson's futures unit), so this is pretty interesting, particularly in light of other futures firms taking a gigantic fucking dump on our collective heads.  Interesting that they're being systematically wiped out.

Thu, 08/02/2012 - 09:37 | 2671883 d edwards
d edwards's picture

J P M looses billions, but don't worry-everythings OK!

Thu, 08/02/2012 - 08:24 | 2671510 malikai
malikai's picture

Deploy the Squid, prepare the Morgue.

Thu, 08/02/2012 - 08:33 | 2671548 Levadiakos
Levadiakos's picture

The Dark Knight Rises..... NOT

Thu, 08/02/2012 - 09:19 | 2671793 GMadScientist
GMadScientist's picture

The Dark Knight..."retroactively" shits its pants.

Thu, 08/02/2012 - 08:24 | 2671511 digitlman
digitlman's picture

HA! HA!

Thu, 08/02/2012 - 08:24 | 2671512 viator
viator's picture

Maybe this will loosen the Fed's bowels.

Thu, 08/02/2012 - 09:20 | 2671797 GMadScientist
GMadScientist's picture

Old Faithful Colonic.

Thu, 08/02/2012 - 08:24 | 2671514 PrintingPress
PrintingPress's picture

Providing liquidity!

Thu, 08/02/2012 - 08:24 | 2671515 orangedrinkandchips
orangedrinkandchips's picture

42 and dropping like it's hot......but who's counting?

 

This is beautiful.....another fraud blow up....just get this main stage so people finally wake up.

 

Ban the bots....

Thu, 08/02/2012 - 08:24 | 2671516 Catullus
Catullus's picture

Are they contemplating options for their severely damaged credibility? Oh yeah. No one gives fuck about that when it comes to other people's money.

Thu, 08/02/2012 - 08:26 | 2671517 Mercury
Mercury's picture

Welcome to America's capital markets.

Home of the do-over.

Thu, 08/02/2012 - 08:25 | 2671521 The Axe
The Axe's picture

holy shit  they lost money faster then MF Global

Thu, 08/02/2012 - 08:26 | 2671526 GetZeeGold
GetZeeGold's picture

 

 

Time to move to France!

 

Thu, 08/02/2012 - 08:37 | 2671576 LongSoupLine
LongSoupLine's picture

Correction:  Like Corzine, time to hide in the Hamptons.

Thu, 08/02/2012 - 08:48 | 2671638 GetZeeGold
GetZeeGold's picture

 

 

I'm pretty sure Eric Holder doesn't even know where the Hamptons are.

 

Thu, 08/02/2012 - 08:26 | 2671523 Dr. Engali
Dr. Engali's picture

Looks like Knight is about to be Corzined.

Thu, 08/02/2012 - 08:27 | 2671531 GetZeeGold
GetZeeGold's picture

 

 

Good night Jon-boy.

 

Thu, 08/02/2012 - 08:38 | 2671586 orangedrinkandchips
orangedrinkandchips's picture

good one...lol

Thu, 08/02/2012 - 08:44 | 2671620 tocointhephrase
tocointhephrase's picture

 Good night, Erin. Good night, everybody!

Thu, 08/02/2012 - 08:26 | 2671524 buzzsaw99
buzzsaw99's picture

they will have to steal a bunch of sub-pennies to make that back

Thu, 08/02/2012 - 08:26 | 2671525 jjsilver
jjsilver's picture

stuxnet.

Thu, 08/02/2012 - 08:28 | 2671537 GetZeeGold
GetZeeGold's picture

 

 

Skynet: I'll be back.

 

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