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Fake Tweet Claiming Assad Is Dead Affects Oil Markets 104

Posted by samzenpus
from the 140-kinds-of-mischief dept.
An anonymous reader writes "Apparently someone set up a fake Twitter account under the name of a Russian Foreign Minister and said President Assad of Syria had been hurt/killed. From the article: 'The ministry and the embassy denied the veracity of the report and a message later appeared on the same Twitter account saying "this account is a hoax." It did not say what the aim of the hoax was although it had briefly affected oil markets.'"
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Fake Tweet Claiming Assad Is Dead Affects Oil Markets

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  • PROFIT! (Score:5, Funny)

    by nbauman (624611) on Monday August 06, 2012 @06:04PM (#40899707) Homepage Journal

    1. Send fake tweet

    2. Buy oil stocks after they go down

    3. Sell them after they go up again

    4. PROFIT!

    • by c0lo (1497653)

      1. Send fake tweet

      2. Buy oil stocks after they go up [valuewalk.com]

      3. Sell them after they go down again

      4. BUSTED!

      FTFY

      • Not BUSTED! but BUST!
      • Re: (Score:3, Informative)

        by PPH (736903)

        1. Send fake tweet

        2. Buy oil futures options in a long straddle [wikipedia.org].

        3. Sell them after the commodity goes up or down. Either way:

        4. PROFIT!

        Jeez! Do I have to teach you folks everything?

        • Re:PROFIT! (Score:4, Insightful)

          by sjames (1099) on Monday August 06, 2012 @09:00PM (#40900977) Homepage

          WRT long straddle or for that matter the very existence of a stock option derivative added to the fact that commodities traders don't take physical delivery, I simply refuse to accept any argument that the markets are distinguishable from casino gambling (other than having an exceptionally toothless gambling commission).

          • by TheLink (130905)

            I simply refuse to accept any argument that the markets are distinguishable from casino gambling (other than having an exceptionally toothless gambling commission).

            Here's the difference:

            In the financial world when you gamble with other people's money and lose big:
            a) you get a bailout and get to keep your bonuses and previous cut of the winnings.
            or
            b) your transactions get rolled back (see the HFT rollbacks).

            In casinos when you gamble with other people's money and lose big, I don't think the outcomes are as rosy.

            It's not mere toothlessness when they rollback HFT trades because of bugs in favoured _players_ systems (it's fine to rollback if it's due to bugs in the "casi

            • b) your transactions get rolled back (see the HFT rollbacks).

              Oh, you mean like the Knight Capital debacle where everyone got a free showing of "HFT market-maker gone wild"? The one where they lost over $400 million on 150 stocks? Trades were busted on only a handful of stocks based on preexisting price rules (IIRC, rules set in place to combat the uncertainty of ad-hoc or politically-motivated busting in response to the May 6 Flash Crash). All other trades stand.

              Now, if Knight gets a "Wall St. Bailou

              • by TheLink (130905)
                No I meant the cases where lots of trades got rolled back/cancelled.
                • No I meant the cases where lots of trades got rolled back/cancelled.

                  Name a recent event. Really, I don't follow the news that closely, and as far as I know the trade-bust rules have become much more consistent as of the last few years.

                  • by sjames (1099)

                    They have, but they systematically favor larger players. Smaller players can't even afford the sort of trading that can get rolled back.

                    • They have [become much more consistent], but they systematically favor larger players. Smaller players can't even afford the sort of trading that can get rolled back.

                      If you're referring to capital limits or the fact that small players can go bankrupt before they accidentally push a price through the limit, then I agree with you but I don't really see an alternative. Traders who can weather larger losses will always win.

                    • by sjames (1099)

                      They could start with basic fairness, no rollbacks, you broke it, you bought it.

                      I can understand that some things are structurally unfair and there's not much for the market to do about it, but there's no need to introduce additional unfairness.

              • by sjames (1099)

                Knight made a HUUUUUUGE mistake. Their new program bought high and sold low, and apparently nobody was watching to make sure it was working right. They got a partial rollback. Had I as a small trader made a mistake proportionally that bad, I would get nothing.

                Knight got a 'private bailout' in the form of a $400million investment from other financial companies. That certainly beats the public bailouts, but it still shows the point. Name a '99%er' who could accidentally bankrupt himself and get bailed out by

          • by Anonymous Coward

            There's a purpose to it. Take a perishable good - bananas, say. Imagine that you live in a port that imports bananas and sells them to the locals. Sometimes there are lots of banana ships coming in, and sometimes there are only a few. This makes the price of bananas go up and down. Consumers don't like this - they prefer to have a steady banana price.

            So you start a business. You buy a big refrigerated warehouse. When banana prices are low, you buy them; when prices are high, you sell them. From this

            • by sjames (1099)

              Except that you can't actually STORE bananas for very long if you hope to sell them. The small window dictated by the spoilage rate of bananas dictates that you can't do very much to stabilize the price, all you can do is drive it up a bit and pocket the difference. It's not like you can actually smooth out a bumper crop or a bad year.

      • by Esteanil (710082)

        1. Buy oil stocks
        2. Send fake tweet
        3. Sell oil stocks after they go up
        4. Profit

        Not like it's that hard to figure out?

        Alternative 2:

        1. Send fake tweet.
        2. Short oil stocks after they go up
        3. Buy back and return after they go down again.
        4. Profit

    • Congratulations on a well used meme in context for once, and in a first post too, makes a nice change! Sadly, this could equally well be the work of a bored student or just about anyone else. I doubt there was that much thought behind it.
    • by Trepidity (597)

      Missing plot twist: the fake Russian Foreign Ministry account was actually operated by the real Russian Foreign Minister, who is also the one who also bought the stocks!

    • by Andrio (2580551)
      1. Buy Microsoft stock.

      2. Create fake tweet that Steve Ballmer resigned.

      3. Sell stock.

      4. MEGA-PROFIT!
    • Re:PROFIT! (Score:5, Funny)

      by Eyeball97 (816684) on Monday August 06, 2012 @07:42PM (#40900441)

      1. Buy Facebook stock

      2.

      No, wait...

    • Replace oil futures report with fake report. Short sale all of the oil futures. Wait for real oil futures report to be broadcast.

      Get even with the rich old white people that ruined your life.

      What were we talking about again?

    • by Surt (22457)

      When I first heard this I assumed oil stocks would go up, you'd short sell and repurchase them after they went back down. So be careful how you manipulate the market, the result may not be what you expect.

  • by Anonymous Coward

    So this was a *real* tweet with fraudulent information in it... how does that make it a "fake tweet"?

    • It's fake the same way as your tweets you're nailing a chick who laughs at your humor.

    • by NonUniqueNickname (1459477) on Monday August 06, 2012 @06:46PM (#40900007)
      The tweet is fake because Bashar isn't dead. He's just resting. Remarkable dictators the Assad family. Lovely oil fields.
      • Re: (Score:2, Funny)

        by gmhowell (26755)

        The tweet is fake because Bashar isn't dead. He's just resting. Remarkable dictators the Assad family. Lovely oil fields.

        He's pining for the fjords.

    • by osu-neko (2604)

      So this was a *real* tweet with fraudulent information in it... how does that make it a "fake tweet"?

      I think the "fake" part was not the misinformation (which is par for the course) but the fact that the tweet was supposedly a tweet from a Russian foreign minister, but actually was not.

    • Next time they ask about my Rolex, I know what to answer! It's not fake, it's a real watch with fraudulent information on it (the brand)!
  • by Rob_Bryerton (606093) on Monday August 06, 2012 @06:18PM (#40899805) Homepage
    See the glory of the Royal Scam.

    So real money is gained and lost as imaginary value is created and destroyed based on imaginary things happening to real people.

    The stock markets are nothing more than a scam, a fixed game, and this event only serves to underline the fact. Don't play the game.
    • by MightyMartian (840721) on Monday August 06, 2012 @06:31PM (#40899885) Journal

      I don't quite get your point. Since value is frequently defined in terms of scarcity, are you saying events that could create even a temporary drop in supply shouldn't have an effect on the value (as a function of the relative scarcity)?

      Sure the this tweet was fake and doubtless was quickly corrected, but let's pretend it was true. Most assuredly it would alter the supply of oil, and hence it's value. But you don't that reflected in the price?

      • by sjames (1099)

        Why? They sell on a 12 month contract and as far as I know, the king leaves the actual work to others anyway. Meanwhile, their production is 1/20th of the U.S. domestic production. None of their oil goes to the U.S.

        Given all of that, it would be hard to justify prices moving by more than $1/bbl in a rational market. But of course, the market if more pack of panicky animals than it is rational.

        • 1. Legal documents don't magically influence supply.
          2. Commodities are globally priced. Are you arguing that the US force domestic producers sell at a lower price than the open market can supply? Will you also insist closely aligned foreign producers take a hit on prices?

          • by sjames (1099)

            1. Nor does a dead king.

            2. No, I'm suggesting that if Syria shut down entirely, there would be less than a 1% deficit and they would likely make up the shortfall within a reasonable time.. Given that there is a 6 week pipeline and many producers are not at capacity due to market conditions, it would be hard to justify more than a percent or so price increase. If THE OPEN MARKET pushed it higher than that, it would be based on gouging and irrational panic rather than actual supply and demand.

            Added in, since

        • by khallow (566160)

          Meanwhile, their production is 1/20th of the U.S. domestic production. None of their oil goes to the U.S.

          Fact one: Syria has substantial oil production.

          Fact two: the "king" in question is the head of state for an unstable, authoritarian government.

          Fact three: a country in full blown civil war, which is what could happen with the death of Assad, won't be producing much oil for sale. A lot of infrastructure would be broken as well, depressing Syria's future oil production.

          Fact four: In the event of a civil war, the fun and games could extend to other countries with greater oil production, leading possib

          • by sjames (1099)

            Syria is NOT [indexmundi.com] a major [cia.gov] producer.

            And prices spiked by a bit over dollar on an unfounded rumor from a tweet. That sure sounds like a bunch of panicky animals to me. A rational market might consider that any id10t can tweet.

            The price was 1.17 since, in fact, nobody died and absolutely nothing changed except someone yelled BOO (in a silly voice). The $1 change would be about right IF the death was real and Syria simply exited the oil market entirely as a result. That $1 is generous considering the elasticity of S

          • by KhabaLox (1906148)

            Fact one: Syria has substantial oil production.

            Eh... In 2009, they were 31st in the world, behind North Dakota. [wikipedia.org] They were producing about 400k bbl/day, or 0.48% of the world's production. (More on this later.)

            Fact two: the "king" in question is the head of state for an unstable, authoritarian government.

            There's been, more or less, a civil war in the country for about 17 months. And by their own reports [oilandgaseurasia.com], production is down to 200k bbl/day or less. The instability of Syria should be already priced in to a rational market.

            Fact three: a country in full blown civil war, which is what could happen with the death of Assad, won't be producing much oil for sale. A lot of infrastructure would be broken as well, depressing Syria's future oil production.

            Discussed immediately above, but to repeat, production is already depressed to less than one quarter of one percent of the wor

        • If that's the case, and you're confident that the move was due to this tweet, then you had an opportunity to make money.

          Overly sharp moves are not, by themselves, an indication of irrationality. Suppose, for example, you had a large sum of money on deposit in a particular bank. And you heard a rumor that the bank was about to fail. If the rumor seemed to you to be reasonably credible you'd want to move your money to another bank. And so would many others who heard that rumor. Maybe nothing will happen, bu

          • by sjames (1099)

            And you heard a rumor that the bank was about to fail.

            What if I hear a rumor from some random Joe that someone might possibly be considering shifting less than 1 percent of the bank's total deposits elsewhere? That would be a lot closer to the situation we saw.

            As for the rest, you got the sense backwards. The natural expectation would be a rise (if anything happened at all). I might well expect a rise, but mostly because the other traders are too irrational to consider the long list of mitigating factors. The way the market is structured makes it into an panic

      • Since value is frequently defined in terms of scarcity

        No. Price may be determined by scarcity, not value.

    • Scarcity is real. If you don't believe me, think to yourself when you ABSOLUTELY need a pen or a pencil how much you'd be willing to pay for a Bic ball point that comes in a 10 pack for 4 bucks.

      • by gmhowell (26755)

        Scarcity is real. If you don't believe me, think to yourself when you ABSOLUTELY need a pen or a pencil how much you'd be willing to pay for a Bic ball point that comes in a 10 pack for 4 bucks.

        Reminds me of the econ professor I had who would provide you with a blue book on exam day if you forgot yours.

        For a mere $2.

    • So real money is gained and lost as imaginary value is created and destroyed

      The value of "real" money itself is only a convenient fiction.

  • The article says nothing about in what way the oil markets were affected, so to spare you having to RTFA I'll copy it below:

    MOSCOW, Aug 6 (Reuters) - A Twitter user sent a hoax message on Monday that quoted Russia's ambassador to Damascus as saying Syrian President Bashar al-Assad may have been killed, forcing Russian officials to quickly deny the report.

    A user on the social networking site apparently pretending to be Russian Interior Minister Vladimir Kolokoltsev quoted the envoy, Sergei Kirpichenko, as sa

  • ...the stock market is run by robots that react to Twitter feeds.

    "Just secured 1 gazillion dollar line of credit from JP Morgan" @dave562

    Woo hoo... my personal stock is up 10% bitchez!!!!

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