As I frequently say, providing live commentary on market moves is sort of like reporting on Brownian motion in a coffee cup — but that doesn’t prevent people (including me) from doing it and often making unfalsifiable statements.
Case in point: today. The major U.S. markets turned and tumbled at 2pm, going from record highs to a loss of around 100 points. So, why’d it happen? I was pinged by a number of people asking (and others answering), so I’ll just repeat a few:
- A popular ETF sold off at 2pm, and that took things down
- JP Morgan made negative comments on Baidu
- Selling programs (a personal favorite of mine)
- Comments from European Central Bank president Axel Weber, who said that Eurozone rates might have to rise
- An unnamed hedge fund was on the brink of closing (a perennial favorite)
- Investors realized that while Wal-mart was reporting good numbers, most of retail wasn’t
- Technology “profit-taking” (a blast from the past)
No-one cited Alan Greenspan, which was a Feel free to add more Popper-piquing excuses below.
Related posts:
Sheesh, everyone knows it was global warming.
More sellers than buyers.
A false positive from the Advanced Market Panic Protection System?
One of my co-workers who day trades loves to explain incremental moves in a company’s stock price during the day with phrases like “profit-taking.” Cracks me up. I can always imagine Nassim Taleb sputtering with anger every time he says something like that.
Absolutely and entirely because I took a loss on my puts of the Q’s in the AM.
My mentor in portfolio management always had the ready answer for this one:
Easy: anticipation of the 20th anniversary. And sunspots. And Satan.
http://www.usfunds.com/docs/pdf/BlackMondayMemories.pdf
P.S. Aren’t the graphs in this presentation embarrassing enough without the Black Swan citation in the beginning?
Stop-loss cascade. And Satan.
A wizard did it.
Too many cats.
My super-secret Ninja powers.
Profit Taking