For those of you who aren't familiar with this story, I will summarize. A fake AP tweet indicated that President Obama had been injured in a White House explosion. Despite the fact that AP quickly flagged the tweet as fake, the S&P 500 dropped 0.9 percent, briefly erasing $136 billion in stock market wealth.
Even though the market recovered quickly upon the realization that the tweet was a hoax, a lot of money changed hands over a very short time frame. There were undoubtedly winners and losers.
The response to this incident was as fast as it was varied. On either end of the spectrum, there were calls to end the computerized trading that caused thousands and maybe millions of shares to be sold in milliseconds. On the other hand, some are looking to the equally swift correction the system enacted and feel that it is an example of things working like they should.
I think that this is another example of how our technological abilities are advancing ahead of our social abilities to deal with the consequences. I put significantly underutilized smartphones, the Cloud, and Facebook into this category. All with differing degrees of consequences.
I do not mean to paint some sort of Terminator scenario where the technology is going to take over our lives and rule the world. Technology can change must faster than society can change. That just means that for a while after a period of rapid technology change, society has to struggle to catch up. I think we are in that type of period now.
It manifests itself in things like some social and emotional upheaval. When automobiles first were commercially available, automobile drivers were seen as rude, impudent upstarts by those who chose to still travel by horse and buggy. Today, we have people making blanket indictments about technology. It is, according to them, a travesty to invest so much into technology.
This disconnect between our technological abilities and our social ability to assimilate to it can also be clearly seen in business. For example, businesses sense that social media is important and will continue to be important. Yet most companies have struggled to figure out how to make social media work for them. The few companies that seem to be having success tend to be newer companies that don't have to assimilate traditional media thinking into a new media world.
I think that the lesson of the fake tweet is neither that the world is coming to an end nor that there is nothing wrong here so don't bother looking into it. I think we need to try to understand how technology changes the traditional paradigms we are working in. In the case of this incident, it isn't only that the stock market can react incredibly fast to changing market situations, but also that we must learn when we can trust our media sources and how easily things like fake tweets can be generated.
I agree with some of the commentators I have read that this incident was not a crash of the system but rather a minor dip. But like a dip in the road, if you aren't prepared and don't know how to drive through it, that little dip can knock your trailer off it's hitch and cause a lot of problems.
It's best that we mind the dips in the road, at least until we can catch up to our technology.
No comments:
Post a Comment