ABSTRACT
On May 6, 2010, an unprecedented event occurred on Wall Street: without warning, from 2:42 to 2:47pm, the Dow fell 998.5 points, valued at about one trillion dollars. Equally astonishing, within minutes it began climbing back up and by closing stocks had almost regained their previous values. Investigations into what was dubbed “the Flash Crash” centered primarily on the extensive use of computer algorithms automated for “high frequency trading” (HFT). The general consensus was that the exchange of enormously large amounts of information in ultra-short bursts of time caused instability in the interactions among multiple systems, which included not only networked computers but also the human traders on the floor. The result was the sudden emergence or “bursting” of what I call an “information event.”
