One of the cool things about global commodity and financial markets is that they’re extremely beholden to arcane algorithms and human computer error, and a single misplaced keystroke can send our civilisation into a new, horrifying Dark Age.
Maybe a bit of an exaggeration, but stories like this don’t give me much comfort. The price of gold plunged in London today after after a huge spike in volume in New York futures which traders said could only be the result of a colossal fuck-up by a – and I quote – “fat finger muppet”.
Trade soared up to the very rare 1.8 million ounces of gold in just a minute, which is not something that usually happens absent some kind of terrible error or a hugely powerful gold baron moving into town..
“No one has a clue, apart from the unfortunate individual that pressed the wrong button,” said David Govett, head of precious metals trading at Marex Spectron Group in London. Head of special metals trading is not a real job, btw. Won’t accept it.
Ross Norman, chief executive officer of Sharps Pixley, a precious metals dealer, was a little more blunt on the big gold numbers:
This bears the hallmarks of a fat-finger ‘Muppet’ – a trade of 18,149 ounces would be a very typical trade, but a trade of 18,149 lots of a futures contract (which is 100 times bigger) would not be.
It leaves us wondering if a junior had got confused between ‘ounces’ and ‘lots’.
I for one definitely know the difference between ounces and lots. For sure I do. I was just making sure that you knew when I asked, over a month into my internship at a precious metals dealer.
To the person who pressed the button: don’t worry mate. Just go sit in the toilet cubicle at the office until this all blows over then duck out at closing time. Nobody will notice.
Source: Sydney Morning Herald.