Source: Pixabay.com | Photographer: HolgersFotografie
As we witnessed in our previous article on the topic, flash crashes can sometimes be sparked by typical human flaws, such as greed or carelessness. This time around, we’ll examine 5 extra cases where the markets crashed not just under the hasty fingers of nervous traders, but also due to some serious malfunctions in the automated trading software they used. However, before we do that, we should probably briefly explain something first.
Source: Pixabay | Photographer: stevepb
Reading time: 4 minutes
Abrupt market crashes, also known as “flash crashes”, are anything but new. And while their effect on the global economies is typically short-lived, there are instances where such downfalls can spark lengthy economic crises, similar to Black Tuesday—the day that marked the beginning of the Great Depression.
As history has shown time and time again, sudden market dips are usually a byproduct of either boundless avarice or downright reckless behaviour. In this article, we’ll look into two real-life stories that completely support both of these stereotypes.