2. Blind Woman’s Bluff – Market World of Warcraft
June 3, 2010
by Ellen Brandt, Ph.D.
Of all the technical indicators around, none is as accurate at predicting market or sector turning points as the deliberate crashing of my computer system. If my poor little PC is weeping buckets of computer-tears and writhing in computer-pain – trust me, something wonderful or dreadful is about to happen to the markets.
My two recent computer breakdowns from within my brokerage account were the first ever – in more than twelve years – to occur while using an Ameritrade site. They were also the first destructive breakdowns of any kind to happen to my fairly new – purchased 16 months ago - Vista-based computer system.
But in the early days of my encounters with my Hacker-Short-Seller-Tormentors, computer system destruction was the weapon of choice, applied so consistently at key market moments, I clearly should have attempted to sell monitoring rights to institutional investors or government agencies seeking to get a better handle on the markets.
Was a sector in which I owned a significant position about to get very good news or very bad news momentarily? Ka-boom! Kaput! Bye-bye, Computer!
Was a particular company I was following about to soar or to falter? Uh-oh, there went my system again.
Was the entire market about to go up 800 points or down 1800 points? Couldn’t take the chance that I’d snag the top or the bottom. Absolutely necessary to take me – The Enemy – out of the game.
Does all of this sound unbelievable, unimaginable, idiotic, and extraordinarily childish to you?
That makes two of us! Because normal human beings don’t act like this. Normal human beings – even if they are Master-of-the-Universe spolled and privileged Kiddie Short-side Traders — don’t believe that playing a cat-and-mouse game with such Guardians of the Internet as Microsoft, Verisign, Intel, and Sun in order to pulverize The Enemy’s driver codes and other system essentials is a “justifiable trading strategy” or a justifiable life strategy.
But that’s just us.
To my Tormentors, anything was OK, so long as they didn’t get caught. And they didn’t. Despite my pleas, my desperate entreaties to everyone from Homeland Security to Interpol to the the SEC to the Pope and the Dalai Lama – OK, I made the last two up - no one in a position of influence seemed to be able to do anything to stop these constant crashes.
In the first eight years of my battles with Tormentor-Hacker-Shorts, from about 1998 until 2006 or so, I lost five entire computer systems, literally broken down so many times and to such an extent, they eventually became unrestorable and unfixable.
These five systems were from different manufacturers in different price ranges. One was even designed by a custom computer builder. No matter. Prior to Vista, the Tormentors had no trouble whatsoever shredding my computers to pieces.
I’ve kept two of these five systems in my home office as paperweights, though. So if a forensic computer investigator ever takes this seriously enough to examine their burnt-out innards, perhaps proof of Who did What to Which is still available.
Pre-Vista, the worst viruses or plagues or worms or scorpions - whatever the heck the weapons of choice were – seemed to have as their goal various driver control files, starting with those affecting peripherals, like monitors and keyboards. This has changed for the better with Vista.
But in the Dark Ages of my initial eight-year battle, in between their knocking out entire systems, my Tormentors gleefully took aim at a system’s Outliers - its peripherals – which were clearly the hacker-prone weak spots before Vista came along.
In the first eight years of my Cyber-Victimhood, I lost a computer mouse about every six or seven weeks, a keyboard every three months or so, and a hard-to-take-out monitor every eight or nine months. Even the most experienced computer repair people became baffled at the success of these attacks, clearly the result of Evil Genius Hackers of Kevin Mitnick-caliber. (Mitnick is the only celebrated Black Hat Hacker whose name I know, because I read Tsutomo Shimomura’s wonderfully interesting book about him.)
I can imagine two nasty little overweight, pimple-faced, 23-year-old “technical traders” on the Maserati Platinum Partners Ultra-High-Frequency trading desk – I do hope this is a not a real firm - gleefully plotting an algorithmic-robotic-goblin-in-the-machine attack:
“Ooooooooooh, Wow! We got her this time, Chad! Convert the keyboard to an obscure Amazonian tribal dialect, using characters shaped like little poison frogs. When the frogs turn purple, they take out the function keys first, the numerals second, and then the rest of the keyboard, which I’ve additionally programmed to give her a bad electric shock – and ideally jump to her washing machine, stereo speakers, and toaster oven.”
Ah, Youth! Ah, Evil!
Let’s Turn Her Eyeballs Into Sightless Marbles
None of my Tormentors’ machinations comes close, however, to their deliberate use of something called Blaster Viruses, which seem to piggyback off various Flash facilities, especially those involving screen savers, wallpapers, or other applications which link visual and audio components.
Blaster Viruses probably first evolved as malicious attempts to take over users’ desktops. Quite aside from their “normal” viral effect, since they work off Flash files, even average computer users may intuitively feel the Blaster Viruses are there, because they cause a slight increase in eye strain.
To me, though, Blasters are incredibly harmful. That’s because, along with a fair number of other people – it’s not that rare an ailment – I have something called a macular hole in one of my eyes.
Don’t confuse this with macular degeneration, which affects many elderly people. A macular hole is a mechanical defect caused by some sort of trauma, like whiplash after a car accident or a serious fall. Mine was caused by a skiing accident in my early 40s.
The condition is cured somewhat by a standard operation involving the injection of a gas bubble into the eye and a prolonged healing process during which you must keep your eyes downcast. I also had to have several follow-up procedures over a five-year period.
But the defect never fully heals. It usually has little long-term effect on basic eyesight. In my case, being only moderately near-sighted and not at all far-sighted, I need glasses for driving, but not for reading, watching television, or working at my computer.
There is one very serious residual effect for people with macular holes, however: We literally cannot stand rapidly flashing lights, If I’m behind a police car with a rooftop flasher or one of those horrid brightly-flashing towtrucks, I have to pull over to the shoulder and wait until the flashing light is completely out of my field of vision.
So to someone like me, Blaster computer viruses are downright painful. Stare at a screen with one for even a half-minute, and it feels like burning hot daggers are being thrust into my eyeballs. My eyes may start pulsing crazily. I get nauseous. And at times, I’ve had to lie down with ice compresses on my eyelids for several hours before the effect is diminished.
To make a gruesome tale shorter, my Evil Tormentors know about my eye condition – like all expert Hackers, they can find out anything by breaking into other people’s files, including medical files – and they’ve used their knowledge for the purpose of pure sadism, causing me as much physical pain and torture as possible via the use of Blasters.
And Blasters have the additional bonus effect of being extremely destructive to computer monitors and systems. Reach out and feel your computer screen. It may not be ice cold, but it shouldn’t be particularly warm. If a very bad Blaster had been placed on your computer, your screen might get so hot, you’d have trouble touching it without getting burned. Sometimes, the monitor gets fiery hot, like the burner on a stovetop.
No, I am not exaggerating.
How About Knocking Out a Library?
After my Hacker-Tormentors knocked out my fifth complete computer system to the point where it was unrepairable, I got so disgusted, I decided that I’d trade my Ameritrade account at the public library.
I actually found a library – not the closest one, but only ten miles away – that had a very nice, modern computer room, if you could ignore the strange people muttering to themselves, others with a slightly pungent odor, or teeny-boppers crowding in after school to collaborate loudly on whatever projects teeny-boppers are assigned these days.
But guess what? At key moments in the general market, sectors I followed, or my individual stocks, my Tormentors still contrived to stop me from trading expeditiously. Only now they had to knock out the entire library. And most of the time, they managed it.
There I’d be, contentedly reading stories from Der Spiegel or Asia Times, intending to make some key trades at the close. And all of a sudden, every computer in the library – which is a lot of ‘em – goes dark. The research desk, the circulation desk, the library’s financial lady working on her accounts – all dark, all kaput, all because of me!
Of course, this was – and is – impossible to prove. And there’s no way of knowing if the darling little Super-Hackers were able to accomplish their amazing feats remotely or if, as part of the Game, they actually sent a young Trader-Hacker to the library itself from somewhere nearby – say – let’s do this by initials – R.T. in East Setauket, the only quant hedge fund within 50 or 60 miles of where I live.
At least it was too difficult for my Tormentors to send Blaster Viruses to an entire library’s machines, so my eyes got a rest. And my foray into Computing-Among-Homeless-People did have the positive effect of introducing me to Vista, which the library switched to soon after I started to use its computers.
In general, Vista seemed safer to me than previous versions of Windows. So in late 2008, after the Crash ate my life’s savings, I decided to bite the bullet, purchase a new Vista-based machine at Best Buy, and retreat once more to the comfort of my home office.
I still had to deal with Hackers and Flamers in the process of relaunching my journalistic career. See “I Don’t Like What You Wrote. You Should Be Stabbed With Stiletto Heels” http://wp.me/pycK6-5 and “My Life With a Twitter Stalker” http://wp.me/pycK6-L .
In fact, I now believe these apparently non-market-related hacking attacks might, indeed, be linked to my original Tormentors or those firms funding their delightful and congenial activities. More about this in future chapters.
But the sinister and physically painful Blaster Virus attacks did not reemerge as a problem on my new Vista machine until I reentered the stock market at the end of February, 2010.
Please reread that. No Blasters trying to take out my eyesight until I dared – dared! – to intrude upon my Tormentors’ main territory again. As if to say, “It’s bad enough Those Who Are Not Us muddy up the Internet with their presence. How dare they attempt to play in our personal playpen, the stock market. Good luck getting us to share our toys.”
With the reemergence of painful Blasters literally hours into my reactivating my Ameritrade on-line account, I should have figured a computer wipeout would occur eventually.
Now that there have been two – both occuring from within my trading account itself, thereby clearly implicating Ameritrade’s own proprietary traders and/or their on-site “Partners” like – oh, I dunno, how about Something-or-Otherville? – in a perverse way, I’m glad these attacks have occurred in such a blatant fashion.
As I said earlier, I had hoped against hope – as I’m sure you did, if you’re a market outsider like me – that after what our country and the entire world suffered in 2008, steps would have been taken to stop the most egregious abuses aimed towards retail investors and smaller institutions.
I had hoped against hope that the perverse concept of on-line brokerages being permitted to trade counter to the interests of their own customers would be held up to public and legislative scrutiny and be abolished forever as the immoral and, in terms of “Chinese walls,” illegal practice I believe it is.
I had hoped against hope that massive class actions would be initiated against the on-line brokers, in an attempt to get retail customers and smaller institutions some restitution for the life-threatening losses we incurred in the Great Crash.
And I had fervently hoped against hope that the poisonous atmosphere of Short-Seller Bullying, in which the markets are viewed as one big Casino, would end. You all know what I mean. Anyone who dares to be long anything anywhere at any time is looked upon as a Mark, a Sheep, and a Shnook. Meanwhile, the Anointed Short-side Insiders are the designated House, raking in all the profits on the table in periodic massive crashes based on wall-to-wall media propaganda led by UltraBear Dons like Nassim Taleb or Nouriel Roubini (who seem to jet from luxurious conference venue to palatial estate, all the while thundering “Apocalypse Now!”)
Smash Those Widows and Orphans
Whether or not they support financial reform, you would think even the most gilded of Market Insiders or most clinically aggressive of Market Bears would draw the line at crashing opponents’ computers or trying to take out an eye patient’s eyesight as as part of a “reasonable trading strategy.”
Indeed, it is quite likely that many of the dirtiest of dirty tricks perpetrated by Short-side Trader-Hackers on proprietary trading desks or elsewhere are the province of very young Kiddie traders, whose supervisors are simply asleep at the switch. After all, these youngsters were probably hired in the first place for their knowledge of computer systems. And Well, Heck! Boys will be Boys.
Only some Boys spent their childhoods pulling wings off butterflies or torturing their little sister’s pet hamsters. For all we know, they may have quickly progressed to sneaking out in their Donald Duck PJ’s to set fire to the neighborhood old folks’ home.
In any case, getting together with other Boys-Just-Wanna-Have-Fun types on an unsupervised trading floor can lead to mob behavior of the scariest kind. If you doubt this, I suggest you view CNBC’s Enron special, The Smartest Guys in the Room, the next time it airs. The most memorable and frightening scene in the saga was a tape of some Kiddie hacker-traders in their 20′s talking about their plundering of California utilities whose stocks and bonds were havens for the proverbial “widows and orphans.”
The cute, carefree, adorable little Kiddies acknowledge this on tape with raucous laughter and commentary along the lines of, “Let’s bleep those Grannies hard. Put ‘em on welfare. Out on the street. Poor old Grannies.” Or words to that effect.
With all the problems I’ve experienced over the years, you might reasonably ask why I don’t hire a computer consultant to monitor my system on a regular basis.
To be frank, I can’t afford one. Maybe I could have before my life’s savings went Bye-bye, but not now. Moreover, since my computer has been designated “Laboratory Number One For Hacker Experimentation,” there’s little reason to think an outside consultant could prevent these attacks from occurring any more than the various anti-malware programs I’ve tried over the years could prevent them.
Microsoft and Verisign and Google and my ISP – all the various Guardians of the Internet we rely on – generally “catch” these viruses and worms and dragons and coyotes and Tasmanian devils – whoever or whatever makes life on the Internet such a minefield – within a few hours at their next scan or update.
But sometimes they don’t. And these Guardians seem either unable or unwilling to intrude on the territory of individual financial institutions – like the on-line brokerages or investment banks or hedge funds - if security problems are occurring, even regularly, within those institutions’ own sites.
The two devastating computer crashes I talked about in “My Life Versus Mrs. Blankfein’s Diamond Earrings” http://wp.me/pVYiX-7 occurred from within Ameritrade’s own site, more or less pointing towards direct involvement by someone with security access to that site, either on Ameritrade’s own trading floor or at one of its “Partner” sites to which they’ve given blanket security access.
It’s high time all of us – investors, traders, regulators, politicians, the Entire Planet – stopped treating this protected class of financial institutions as a world apart, somehow exempt from investigating and stopping internal bad behavior or outright criminal offenses perpetrated by employees, “rogue” or otherwise.
In a coming chapter in this series, I will post an open letter to my broker, Ameritrade, asking them to investigate, correct, and somehow reimburse me for the losses I suffered because of their own employees conspiring to crash my computer.
But I’ll go further, telling Ameritrade management how I believe they could stop these abuses from happening ever again and satisfy their customers’ demands for a safer, fairer, and more honest market environment, in which everyone pulls together, rather than acting in direct opposition to other groups perceived and often demonized as “Enemies.”
Markets should be cooperative ventures, not war zones. Legitimate “trading practices” do not include bullying, harassment, hacking, spying, nor disabling other people’s computer systems.
My life and my well-being are not Games – and neither are yours.
We’re all human beings. Not animals. Not aliens. Not avatars in Market-World-of-Warcraft.
The next chapter in this series will go back to the beginning and theorize why and how the anti-Me vendetta came about.
For the next two stories in this series, see “Midnight Death Threats and Kittens With Their Throats Slashed”
and “An Open Letter To My Broker – How To Make Things Right”
For the first story in this series, see “My Life Versus Mrs. Blankfein’s Diamond Earrings” http://wp.me/pVYiX-7