Reuters | U.S. regulators still have not found evidence that erroneous activity or system malfunctions triggered the recent unprecedented market crash, a Commodity Futures Trading Commission official said on Monday.
More than two weeks after the Dow Jones industrial average lost nearly 700 points in minutes before recovering, regulators and exchange operators are still searching for answers.
The CFTC official told a regulatory panel exploring the crash that
the initial findings showed that the “flash crash” was not so much the
cause of a single event but a confluence of events that led to the
dislocation in liquidity.
The CFTC and the Securities and Exchange Commission have been analyzing
the events of May 6 including the links between declines in prices of
stock index products such as E-mini S&P futures contracts and the
use of stop loss market orders.
The panel set up to advise regulators on emerging regulatory issues is
made up of former and current regulators and other financial luminaries.
It includes Nobel laureate economist Joseph Stiglitz and Richard
Ketchum, the head of the Financial Industry Regulatory Authority, a
regulator for more than 30 years.
Brooksley Born, who has been vindicated for trying to regulate the $615
trillion over-the-counter derivatives market when she was the chairman
of the CFTC, also is on the panel.
Now there is evidence:
http://www.nanex.net/20100506/FlashCrashAnalysis_Intro.html
- Jeff