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2002's News, Yesterday's Sell-Off

After that, Tribune and Google disagree.

Last night, Tribune Co. provided a screen shot showing the 2002 story on Google News with a Saturday, Sept. 6, 2008, date. Tribune spokesman Gary Weitman said the Google crawler somehow pulled the old, undated story from the Sun-Sentinel online archive at 10:36 p.m. Pacific time on Saturday.

Google blogged about the incident on the Google News Blog late last night, confirming it had found the article at 10:36 p.m. Saturday. But Google said the article had appeared on its own since its crawler last visited the newspaper site, at 10:17 p.m. Regardless of how the 2002 article got on Google News, the increased traffic resulting from its presence there may have caused it to pop up when the reporter from Income Securities Advisors typed in "bankruptcy 2008."

In the mind of the reporter, Wall Street would want to know about a major airline declaring bankruptcy. The reporter posted the story to the Bloomberg Professional service at 10:53 a.m. yesterday.

Six minutes later, Bloomberg posted a news article headlined: "UAL Shares drop 33% at 10:58 a.m."

At 11:16 a.m., Bloomberg posted a correction in several languages, highlighted in red on the company's proprietary monitors: "UAL SAYS IT HASN'T FILED FOR CHAPTER 11."

"It shows the market apparently reacts to a headline as much as anything else," said Richard Lehmann, president of Income Securities Advisors.

Lehmann said yesterday's mistake was the first at his firm in 10 years. He was reluctant to heavily criticize his reporter, but said, "It would have been nice if the reporter had been more grounded in what's going on out there in the world."

"The fact that this happened with a major corporation like United based on one headline coming across Bloomberg, that you'd get this kind of knee-jerk reaction, there's something wrong with the trading mechanism," Lehmann said.

Income Securities Advisors is one of many "third-party" contributors to Bloomberg Professional, a subscription service used by Wall Street traders.

The Bloomberg Professional service is an Intranet limited to subscribers, who see news stories and financial information provided by Bloomberg employees, as well as content from third-party contributors, such as the six-year-old story mistakenly posted by Income Securities Advisors.

"The closest analogy would be a television network's content being carried by a cable carrier," Bloomberg spokeswoman Judith Czelusniak wrote in an e-mail yesterday.

Bloomberg had no further comment on yesterday's incident, she said.

Lehmann said he started getting phone calls shortly after his company posted the story from the Sun-Sentinel. Once he realized what had happened, he moved quickly -- he called Bloomberg and had the six-year-old story removed at 11:08 a.m. About 20 minutes later, Nasdaq halted trading.

In a statement, Nasdaq said all trades during the chaotic period from 10:55 -- two minutes after the story was posted -- to 11:08 would stand and had no further comment.

United said it is launching an investigation.


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