Concerning that drop in the Dow yesterday

Unless you slept the last 24 hours, you know the Dow Jones dropped the most it ever had yesterday, about 1,000 points, before recovering a bit for "only" a loss of 347.80 points.

Whew.

That was close.

But looking into this further, there was already news out this morning that--oops--it may have been a computer accident.

Or something.

And I'll tell you what, the government better look into this--thoroughly and quickly--to find out what, exactly, happened, why, how and whether anything even inappropriate happened, if not out-and-out manipulative and/or illegal.

A few days or times of that kind of trading happening and any faith in the markets would not just be shaken but destroyed.

How likely is it people and companies would want to trade when markets are that volatile?

Nothing would be safe.

Check this out from Bloomberg News today:

The market rout triggered scrutiny from lawmakers. U.S. Representative Paul Kanjorski, a Pennsylvania Democrat, set a May 11 hearing. U.S. Senator Ted Kaufman, a Delaware Democrat, questioned whether markets that increasingly rely on computer algorithms to execute thousands of transactions in seconds triggered false trades.

“This is unacceptable,” Kanjorski, who leads a House Financial Services subcommittee that oversees the SEC, said in a statement. “We cannot allow a technological error to spook the markets and cause panic.”

Yeah, I'll say.

Then there's this from Talk Left Blog :

Algorhithms may be the culprit.

High-speed trading, which uses sophisticated computer algorithms based on specific scenarios to automate transactions at speeds in the millionths of a second, now accounts for about 60 percent of U.S. equity volume.

"The potential for giant high-speed computers to generate false trades and create market chaos reared its head again today," Senator Edward Kaufman said in a statement.

"False trades"?

So yeah, Congress, please look into this, right away and thoroughly, please.

And don't pander to the corporations running this show, either.

(Man, that last line is funny, ain't it?)

Have a great weekend, folks. (If the markets don't collapse).