Blown To Bits

Manipulating the Stock Market

Saturday, October 4th, 2008 by Harry Lewis

In a piece I wrote a couple of weeks ago, I talked about the lessons to be drawn from the aftermath of a six-year-old bankruptcy story about United Airlines carelessly posted on a Bloomberg site, comparing it to wacky Internet rumors about the presidential candidates:

With human judgment so eclipsed by responses to atomized, instant data, can there be much doubt that intentional manipulations—of the markets, and of the electorate—should be expected?

Yesterday an anonymous citizen journalist posted to a CNN site that Steve Jobs had been rushed to a hospital after a heart attack, and Apple’s stock dropped 5.4%. The SEC is investigating.

Of course there are morals here. That citizen journalism, the exploitation of millions of eyes and ears through the wonder of Internet connectivity, is a wonderful evolution of journalism, except when it isn’t because any damn fool can say anything and there’s no validation or fact-checking. That instantaneity, much as we love it, sometimes has a big pricetag. And maybe that it’s worth asking whether the law protecting CNN in this case (it bears no responsibility for the anonymous poster’s falsehood) may be a little too generous.

But mostly what I’m thinking is that it didn’t take long for one of my predictions to come true. The other one, about the opportunity to manipulate the election by spreading a last-minute rumor, wouldn’t be timely quite yet. But I’ll bet there are people thinking about how to pull it off.

One Response to “Manipulating the Stock Market”

  1. Waiting for an election bomb « Arctic Penguin Says:

    [...] news regarding Steve Jobs’ health. Noting this trend wayyyy before Cohen, Prof. Harry Lewis fears that a similar thing will happen with the election at the last [...]