I was on TechTicker at 7-30 Friday morning sitting with Henry Blodget and Aaron Task of Yahoo and left by 8-15 for a meeting back downtown.
The market opened and I was still in a meeting, but long Apple and following my Twitterific, mostly StockTwit stream of information.
I was not following Apple’s stock price, but I guess it dropped really fast as my stream filled with ‘Steve Job’s had a heart attack‘. I quickly called Phil and Soren for a price who said the stock was down in the 90’s. I immediately twittered that this was a trade once I heard it was reported by citizen journalist at CNN. I also twittered the sale of that trade for a quick 7 points.
Rumors are VERY dangerous to trade on, and the blog world circulates more rumors than any other medium on earth, but the blog world can also force the truth to surface much quicker than 7 years ago.
I remember an EMULEX fake story hitting the wires in 2002 and the stock dropped 70 percent before anyone could get the real news out or find a trusted place to get consensus on the real news. Traders were sitting ducks.
Friday, the only traders that were sitting ducks were the traders that do not use Twitter, services like Stock Twits, blogs, Google Reader or a real time web service in the same vein.
I think the blog world did an excellent job. Hopefully CNN, and the ijourmalism school of yutziness that they created can figure out a way to build some reputation into their lame all flash citizen news service, but since they don’t do it for their TV network I imagine that’s just a dream. Henry and the rest of the rumor spreaders just helped get the real news to the surface much faster.
To be honest, this time it actually worked as Apple quickly recovered without being halted. Day trading is dumb and I dont encourage, spend time on it or even want to do it. Maybe blog rumors will just get more people doing it, but I think it will just chase more people away. That’s good.
In fact, in the Stock Market 2.0 world that should develop, stocks could be open Tuesday, Wednesday and Thursday and we would have a way more productive nation. Period.