photo: Yodel Anecdotal
Times Online reported today on a major Google gaffe in which a 2002 United Airlines bankruptcy article was featured on the Google News website.
The US Securities and Exchange Commission has opened a “preliminary inquiry” into how an outdated bankruptcy story sparked a $1 billion run on an airline’s stock value.
The article about how United Airlines filed for bankruptcy in 2002 was revived when it showed up on a newspaper site’s “most viewed” section on Monday.
From there it was picked up by Google News and later seen by alarmed stockholders. The stock plunged from around $12 to just $3 a share before trading was halted.
However, Google blames this whole incident on a series of gaffes. It says that a single visit in the early morning to the 2002 news article pushed it onto the “Popular Stories” section of the South Florida Sun Sentinel website (a Tribune owned newsflow). From there, Google News found the link to the old article but failing to find a date on the article, marked it for inclusion on its website. It took just three minutes and two seconds for it to appear on Google News.
Once it hit Google News, it appeared on Bloomberg. And automated trading programmes which analyse online news articles suddenly sold United stock causing it to be sold in droves, driving down it’s value.
In some ways, I think this just demonstrates “Garbage In, Garbage Out” which is well known to computer parameters. Being “old news”, the original article was obviously garbage. Google News regurgitated this garbage back out without any checking (as there are no human editors). Similarly, trading programmes consumed garbage in the form of old news and acted badly on it (selling the stock and causing the $1bn run on United).
With an investigation pending, it’ll be interesting to see how this all turns out.