Well, it happened in 1998 and then again in 2008. The “Masters of the Universe” who are always the smartest guys in the room “misunderestimated” the intensity of the herd’s panic attack, and so their trading parameters, they were surprised to learn, were way to narrow, and the next thing you know a chain reaction of puts and calls is triggered and the smartest guys in the room are caught with their pants down. They don’t have enough money to cover their position so they turn to the long-suffering United States taxpayer for succor. Will we be fooled yet again?
The real question is will the so called “conservatives” here, and in political office, will act like tyrants and seek to further regulate derivatives. Leave the derivative traders alone. Only someone who rejects liberty would impose more Barney Frank style solutions.
Leave us alone!
Somehow, all those fancy trading algorithms always seem to forget to factor in things like mass hysteria.