The robots vs. robots trading that has hijacked the stock market
In truth, there is no reason that a financial system has to be this complex and so volatile It has been comical to watch the parade of guests on the business news channels this week try to explain to viewers, and to one another, why our hyper-efficient financial markets — the ones that are supposed to be so brilliant at pricing the value of everything — have been bouncing around like a squash ball on an overheated court. Pay no attention to the volatility, these financial wizards assure us. It’s just a little technical correction, a bit of froth being taken off the top of a market that had gotten a little ahead of itself. The fundamentals of our otherwise sound economy will soon reassert themselves. Why is it that when the market is climbing by improbable leaps and bounds month after month we are supposed to take that as a genuine reflection of the fundamentals, but when the market is in a free fall, we are suppos...