The US is still a wasteful nation. I mean come on, even when they are broke and struggling to make ends meet they do not downgrade their living, holding on their spendthrift habits until the inevitable comes and they have to fall off a cliff.

And yes. wall street... sigh... day trading... sigh sigh....

Wall Street: Flash Crash Caused By Computer Algorithm On Dow Jones
The Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) released a 104 page report on Friday afternoon with the results of their investigation of the “Flash Crash” in May, 2010. The crash was found to have been caused by an automated “Sell Algorithm” used by a trading firm. The firm was not officially named in the report but is speculated to be Waddell & Reed, a financial planning firm located in Kansas.

What Is A “Flash Crash”
The Flash Crash of May 6, 2010 occurred when the Dow Jones Industrial Average dropped by the biggest one-day point drop in history, plunging over 600 points. The total for the day was 998.5 points dropped. Ten minutes later, the market regained most of the 600 points.

The cause was speculated to be caused by human error, high frequency traders, large directional bets, change in market structure or technical glitches.

Finally, on Friday, October 1, 2010, the official report was released explaining that the crash was caused by the use of an automated “Sell Algorithm” selling $4.1 billion of stock index futures by a single firm hedging against the market.

What Is A “Sell Algorithm”
A Sell Algorithm is a computer program used for trading contracts. In the case of the crash on May 6, 75,000 E-mini contracts were sold in 20 minutes. This same type of transaction executed earlier in the year took over five hours to complete. The speed of the transaction caused high-frequency traders (HFT) to sell their contracts. Long-term buyers would not buy because of the selloff. HFTs began quickly buying and then reselling the contracts which caused the program to sell more quickly and flood the market.