Updated United Airlines' stock price plummeted more than 75 per cent yesterday, after a six-year-old bankruptcy story somehow surfaced on Google News.
As reported by The Washington Post, this labyrinthine tale began on Saturday, when Google News indexed a United bankruptcy piece published by the Chicago Tribune way back in 2002. United filed for chapter 11 that December, but emerged from bankruptcy four years later.
Google insists the South Florida Sun-Sentinel - a Trib sister paper - republished the story at about 10:30pm Pacific Saturday evening. But the papers' parent company says Google bots must have pulled the piece from the Sun-Sentinel's online archive.
In any event, the story lacked a date stamp. So Google stamped it with the current date: September 6, 2008.
Two days later, an unsuspecting reporter with a Florida investment research firm/news outfit typed "bankruptcy 2008" into Google News, and the six-year-old story appeared in the search results - looking brand new. The research firm, Income Securities Advisors, happens to be one of Bloomberg's so-called third-party content providers, and the story was soon spewed onto Wall Street monitors via a Bloomberg subscription news service - as nothing more than a headline.
The headline read "United Airlines files for Ch. 11 to cut costs."
When the Nasdaq Stock Market opened Monday morning, the stock price of United's parent company, UAL, sat at $12.30. But when the Bloomberg headline appeared at about 11am Eastern, the price dipped to $3 within the hour.
UAL trading was eventually halted, and after the headline was explained, the stock rebounded to $10.92 by closing time. But this tale paints a telling picture of Wall Street - and the news game. We can't decide which is more ridiculous. ®
The Tribune Company has now said that traffic to the Sun-Sentinel's archive pushed the old bankruptcy article onto the "most viewed" section of the paper's web site.