Safeguards Protect Financial Markets Against Misinformation Like AP Twitter Hack
HUNTSVILLE, Ala. (WHNT) – The world held its breath Tuesday, when the AP falsely tweeted an attack on the White House had injured the president. Their account was hacked; the information – not true.
Still it made for a scary moment, and it rippled through financial markets, causing an immediate downturn.
Markets did recover when the actual situation became clear.
But just how vulnerable are financial institutions to dangerous misinformation?
Thankfully, they’ve got safeguards in place.
The instant flow of information from twitter created the panic, but it also corrected it.
Investment Adviser Gary Saliba explains, “The safety net in our system is that the dissemination of the accurate information occurs just as quickly as the incorrect information.”
For all the flak we give social media, its weaknesses can also be strengths.
Saliba shows us how that reflects in Tuesday’s market activity, “Within the span of twenty minutes this starts and ends, and we’re back to a regular day.”
But those twenty minutes could have opened the door for malicious forces to manipulate the market’s movement – possibly making a ton of money.
Saliba points out, “The electronics behind the trading are as sophisticated as the dissemination of the information.”
Monitors track markets and stocks, but they also track individual brokers and traders. If you’re making money on the market, the government has records of you doing it.
So while a misinformation campaign like we saw Tuesday could temporarily derail the market, it would be very difficult to take advantage of that.
Saliba elaborates, “If you had the plan to hack into the AP, disseminate the bad information, and short the market and profit, within 24 hours they would know your identity.”
Up to our eyes in keyboards and pixels, it’s easy to feel like our constant flow of information exposes us, but it also protects us.