Here's something directly from one of my favourite sources of tragi-comedy, the risks digest:
Software error reportedly contributed to sudden Dow-Jones drop <"Peter G. Neumann"
> Wed, 28 Feb 2007 11:37:15 PST
On 27 Feb 2007, the Chinese stock market experienced a 9% drop. This apparently inspired heavy selling on the New York Stock Exchange, with a volume about twice normal. At one time, the calculation of the Dow Jones Industrial average was running about 70 minutes behind. Recognizing some sort of computer problem, DJ switched to a backup computer, which over a period of about three minutes caught up -- resulting in the posted average dropping about 240 points in those three minutes. This evidently led to some further panic selling. (At one point, the market was down 546 points, although it later recovered to close down only 416.) The cause of the software problem is under investigation. [Sources: Swiftness of Dow Drop Due to Computers (The Associated Press), *The New York Times*, 27 Feb 2007; A Glitch in the Financial Matrix: How Heavy Trade Volumes and a 70-Minute Time Lag Wreaked Havoc Upon the New York Stock Exchange, Dan Arnall, ABC News, 27 Feb 2007; starkly PGN-ed]
It will be interesting to see whether the SEC tracks down anyone making large arbitrage gains as the markets drifted further and further out of sync - something someone with early or even advance knowledge of the glitch could have used to make billions.
And, speaking of minor glitches, Canada's national tax collection agency has been a bit embarrased lately. Here's part of a write up by Kathryn May and Carla Wilson, for the CanWest News Service:
Canada's tax agency has pinpointed the computer glitch that has all but paralyzed the filing and processing of personal tax returns this week, but it will be days before online services are up and running again.
The agency shut down its online tax services Monday night after discovering "irregularities" in the transfer of information between the 75 databases that store and handle Canadians' personal tax information. The shutdown, which is unprecedented in the agency's history, has effectively stopped the tax season in its tracks.
Officials at the Canada Revenue Agency said it has a team of experts working around the clock to restore systems to normal and expect it will be a "matter of days" before the problem is fixed and electronic services are up and running.
That team of experts, by the way, is apparently from Computer Associates in New York - and as of today, March 11, they're still working on it.
So what's special about these? Try a google search to see what computer disasters the press describes as mere glitches have in common - and notice that exactly nobody goes all tango uniform over them. Food for unhappy thought, isn't it?