It’s a little old by now, but this is an interesting story about how automated news crawling wiped $300m off United Airlines’ market cap. Basically this is what happened:
- Back in 2002 United Airlines was on the brink of bankruptcy – that obviously made the news
- For some reason an old story became popular on the South Florida Sun-Sentinel newspaper website – it got put back onto the front page but without a date
- Because there was no date the Google News crawler picked up the story and put it onto today’s news
- Several other news aggregators picked up the story and it “eventually headlined as a news flash on Bloomberg”
- That triggered automated trading programs to sell-sell-sell
- The selling spree wiped 1.14 billions dollars off of United’s market cap
- During the day stock recovered but ended $300 million down
Crazy stuff.