Lisa Chow is the economics reporter at WNYC. She tries to explore in her stories surprising aspects of New York’s many economies—in plain view or hidden, in neighborhoods or sectors.
Regulators Still Can't Say What Caused Market Plunge
Wednesday, May 12, 2010
New York, NY —Financial regulators told Congress they need more time to figure out what caused last week's stock market plunge.
Testifying yesterday, Mary Schapiro, head of the Securities and Exchange Commission, said she still couldn't say what triggered the massive sell off last Thursday. But she did try to tamp down rumors, saying it probably wasn’t a "fat finger" error, a trader punching in billion instead of million of shares to sell and that there was no evidence of terrorist activity or a computer hacker causing the sudden 1,000 point drop in the Dow Jones Industrial Average.
Pennsylvania Democratic Congressman Paul Kanjorski questioned Schapiro, asking "What's the possibility that tomorrow, the same thing could happen?" Shapiro answered "I have to say it's not impossible. There's no reason to expect that it would happen tomorrow."
Schapiro said she’s working with the different stock exchanges to adopt a uniform set of rules to slow trading of a stock when it experiences extreme volatility.