What Freaked The Market Out On Thursday? It Was Those Damn Protest Videos On TV


Photo: Bloomberg

In his weekend note, Cumberland’s David Kotok passes on Art Cashin’s account of what happened on Thursday.This part stuck out:

Around 2:00, the scene in Athens began to turn more fractious.  TV screens across the floor (and across America) were filled with scenes of police wading into pockets of riotous protestors.  Each foray was marked by audible reactions on the floor.
Bids began to cancel all around.  The level of selling picked up and prices moved steadily and sharply lower – down 250, then 275; 325; 375; 400 then down 450.
Around 2:40, the selling grew very intense.  Prices began to cascade lower in waterfall fashion.  The Dow seemed to fall in 50 point increments.

In the end, we’re just animals. Sure we can retroactively blame Mohammad El-Erian for his gloomy comments that day, or Jean-Claude Trichet’s unwillingness to bring out the bazooka, but in the end, what got the selling going was images of police wading into a crowd with clubs, and those images being blasted onto trading floors. Fight or flight.

Don’t miss: Pictures of the most violent Greek riot yet >

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