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NYSE Tuesday opening mayhem traced to a staffer who left a backup system running

bloomberg.com

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Re: NYSE Tuesday opening mayhem traced to a staffer who left a backup system running

#111

Post by ajoseps »

xyzelement wrote: post #93
jrochkind1 wrote: post #87

> That misled the exchange’s computers to treat the 9:30 a.m. opening bell as a continuation of trading, and so they skipped the day’s opening auctions that neatly set initial prices. I didn't even know about this process. I don't know much about trading, but it surprises me that there is a separate process for setting prices at the start of trading, and that if it's missed, chaotic prices result. Is this related to…

That's right. In short it's something like this: stocks trade on their primary exchanges during specific hours. For example 9:30 to 4 in the US. Part of it is legacy from when trading was done by actual humans being at the exchange physically to trade during those times and part of it (I would guess is still the case) is to allow plenty of non-trading hours for back-office jobs and settlement. So yes there's a specia…

isn't there another component to the NYSE auction where the DMM has some input into what the closing/opening price actually is?

Re: NYSE Tuesday opening mayhem traced to a staffer who left a backup system running

#112

Post by yakubin »

h2odragon wrote: post #64

Tuesday news blackout; Thursday "it was all Jim's fault"... Right. Smells like horse shit. Most of what comes out of the profession of "journalism" does too, lately; but this smells strongly .

Why couldn’t have been Jim’s fault? The world is run by Jims.

Re: NYSE Tuesday opening mayhem traced to a staffer who left a backup system running

#113

Post by maronato »

irthomasthomas wrote: post #103
itsoktocry wrote: post #94

Earlier quoted context omitted.

> Is it normal to simply accept the word of an anonymous source for something so important? Anonymous means they aren't revealing the source, not that Bloomberg doesn't know who the sources is, or what they do.

I know that. I am referring to you and I, the reader accepting the word of the anonymous source. Combined with the fact that they apparently did not ask for a comment from the NYSE before publishing this. Or if they did, they neglected to mention it.

We aren’t accepting the word of the anonymous source. We’re accepting Bloomberg’s word that the source is reliable.

Re: NYSE Tuesday opening mayhem traced to a staffer who left a backup system running

#114

Post by reaperducer »

mellosouls wrote: post #22

These "issue traced to staffer" stories sound like management cover up for management/system shortcomings to me. Systems with such significant potential impact, and in industries where lack of financial investment in their continuity is a deliberate choice have very little excuse to be passing the buck to grunts for basic process flaws that can be triggered by individual error.

These "issue traced to staffer" stories sound like management cover up for management/system shortcomings to me.

If you're going to move the blame up the food chain, might as well blame the shareholders for giving the company money and choosing to keep the upper management in place.

Re: NYSE Tuesday opening mayhem traced to a staffer who left a backup system running

#115

Post by reaperducer »

irthomasthomas wrote: post #58

Is it normal to simply accept the word of an anonymous source for something so important? I genuinely don't know, anymore, but it doesn't seem like a good idea. I'd rather wait for a more thorough investigation. Especially when the story from these sources boils down to "Kevin was in charge of booting the NYSE App that morning, but he was late for work. He had a good excuse, though, he flaked! We'll have the chap str…

I don't know how Bloomberg works, but the New York Times has a very clear and public policy about using anonymous sources.

There's usually a link to it in the middle or end of any story it publishes using an anonymous source.

The Times isn't Bloomberg, but it might give you some insight into how these things work.

Re: NYSE Tuesday opening mayhem traced to a staffer who left a backup system running

#116

Post by khold_stare »

ajoseps wrote: post #111
xyzelement wrote: post #93

Earlier quoted context omitted.

That's right. In short it's something like this: stocks trade on their primary exchanges during specific hours. For example 9:30 to 4 in the US. Part of it is legacy from when trading was done by actual humans being at the exchange physically to trade during those times and part of it (I would guess is still the case) is to allow plenty of non-trading hours for back-office jobs and settlement. So yes there's a specia…

isn't there another component to the NYSE auction where the DMM has some input into what the closing/opening price actually is?

Yes. In my reply to the first comment I mentioned setting the opening price is "more complicated". Every exchange has their own system for the opening auction which you buy into when you list with a particular exchange. Most exchanges have an algorithmic way of calculating the price. For NYSE, it's again more historical. A Designated Market Maker (DMM) for a stock technically determines the opening price. There is a person physically on the NYSE trading floor who represents the DMM firm who technically opens the different stocks. They have a weird custom keyboard from NYSE for this purpose...

The price is usually calculated algorithmically by the DMM firm and sent to the person at NYSE to approve. Pretty arcane. Also somewhat shady, as the DMM firm can be and is part of the auction themselves. DMM firms can analyze the order book to see what the imbalance is in the overlapping region, and place an order of their own to correct the imbalance and then set the opening price. I can see how one can profit from this in certain situations

Re: NYSE Tuesday opening mayhem traced to a staffer who left a backup system running

#117

Post by reaperducer »

nix23 wrote: post #75
wongarsu wrote: post #60

Earlier quoted context omitted.

One person might be inattentive or drunk, but it's less likely that two people are. So you institue a two-person rule. And if that's not good enough, add a third person to double-check. Maybe a supervisor to observe the people doing all of the above, to catch any mistakes or negligent behavior. Also have them write down the steps they have taken, and have somebody else read through that to verify. Just keep adding pe…

So two people are more reliable as a automated system you wanna say? That's totally wrong....

Sounds like you've never experienced a catastrophic failure due to an automation that didn't work right.

I did last year, and my company is in the process of de-automating certain processes that can endanger that company if they go wrong.

There are many things in tech that are too important to automate.

I'd even posit that the more experience you have in tech, the more you've seen how things go wrong, and the more you realize that automation is a tool for humans to use, not a replacement for humans doing a task.

Re: NYSE Tuesday opening mayhem traced to a staffer who left a backup system running

#118

Post by PragmaticPulp »

mellosouls wrote: post #22

These "issue traced to staffer" stories sound like management cover up for management/system shortcomings to me. Systems with such significant potential impact, and in industries where lack of financial investment in their continuity is a deliberate choice have very little excuse to be passing the buck to grunts for basic process flaws that can be triggered by individual error.

> These "issue traced to staffer" stories sound like management cover up for management/system shortcomings to me.

At the end of the day, the engineers are responsible for the engineering. Managers are responsible for managing. Shifting all responsibility for execution issues on to management can give warm fuzzies, but in reality managers aren’t all powerful in shaping execution by engineers.

Companies that put all blame on managers when things fail are inevitably encumbered with excessive micromanagement, as the managers are effectively saddled with responsibility for execution as well.

The article was purely anonymous. I don’t think it’s fair to assume they’re jumping to blame or fire individual engineers.

Re: NYSE Tuesday opening mayhem traced to a staffer who left a backup system running

#119

Post by h2odragon »

yakubin wrote: post #112
h2odragon wrote: post #64

Tuesday news blackout; Thursday "it was all Jim's fault"... Right. Smells like horse shit. Most of what comes out of the profession of "journalism" does too, lately; but this smells strongly .

Why couldn’t have been Jim’s fault? The world is run by Jims.

As others have said, if Jim's fuckup can have such large consequences, then there should have been backstops for Jim who would have shared the blame. Nothing against Jim, it's just he's being used as a distraction to avoid talking about the real issues.

Re: NYSE Tuesday opening mayhem traced to a staffer who left a backup system running

#120

Post by ajoseps »

khold_stare wrote: post #116
ajoseps wrote: post #111

Earlier quoted context omitted.

isn't there another component to the NYSE auction where the DMM has some input into what the closing/opening price actually is?

Yes. In my reply to the first comment I mentioned setting the opening price is "more complicated". Every exchange has their own system for the opening auction which you buy into when you list with a particular exchange. Most exchanges have an algorithmic way of calculating the price. For NYSE, it's again more historical. A Designated Market Maker (DMM) for a stock technically determines the opening price. There is a…

I didn't realize the floor broker was actually involved with setting the opening price. I always wondered what the incentive was to access floor feeds for opening auctions
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