Resistance Is Not Futile
I'm home with a broken ankle today and so was able to watch the stock market reaction to the release of Federal Reserve Chairman Ben Bernanke's speech on fiscal policy. Tens of thousands of brokers and investors were eagerly awaiting this speech to try to forecast the direction of the stock market. Many were ready to immediately execute trades based on the content of this writing.
I watched CNBC and the market reaction to the speech. The market almost immediately dropped 100 points, just minutes after the speech was released to the public and before he had even begun reading his speech. No human could possibly have read his speech that fast. At best they could have skimmed a few paragraphs. Yet millions, perhaps billions of dollars changed hands as the market plummeted. Then, as if by magic, in the next hour the market climbs back up that 100 points lost, and goes even higher. What the hell happened? Bernanke did not depart from his published speech.
A CNBC reporter on the floor of the New York Stock Exchange (I think it was Bob Pasini) provided a very interesting explanation, one which I predict will not be again repeated and may even be hushed up. I will not forget it because it made perfect sense to me and has implications for legal search in e-discovery.
Read the full commentary on LTN online.
Image: courtesy of Ralph Losey