1987 ON HIGH SPEED ACCESS...THE BIG KAHUNA

Did you have high speed internet access in 1987? Me neither. Isn't technology great? Today I can access the internet from my cell phone, I can e-mail you from my Blackberry, I can get instant alerts on my PDA. And I can do it all very fast from anywhere. What a world we live in. Some people say they are always "in touch" and can be reached anytime of day or night on any one of a number of devices that keep them connected to their business, friends, & loved ones.

While all the connectivity may be good for business and for staying in touch with your spouse, there may be one problem that nobody is thinking about. Being connected may let too many people know about, and act upon, a stock market correction or crash, faster than anybody might like.

In 1987, one of the biggest problems, other than the market dropping 23% in a single day, was that investors could not get through to there brokers or mutual fund companies to place orders, which were mostly to sell. By the time the dust settled, many investors were locked out of trading and it was too late to sell or buy anything. Today, with all the high speed internet connections, cell phones, PDA's, blackberry pagers and the like, everybody will know what's happening at the same time, and will be able to act upon that information, in real time and very fast. No broker to call or mutual fund hold messages to annoy you. Just hit the "enter" key and its done.

Since 1987, the NYSE and the NASDAQ marketplace have ramped up there trading capacity by many fold, which would allow huge amounts of volume to be executed by the masses. Yes there are market triggers that would halt trading at various stages of a large market move, yet that would only temporarily stop the deluge of sell orders coming in from every DSL line and cable modem that has been installed over the past few years.

A high speed access, fully connected 1987 style crash would look very different. Volume would be enormous. For example, if volume were to jump say 5x normal, some 8 billion shares would trade on the NYSE and about 10 billion on the NASDAQ. What's amazing is that the new systems in place could probably handle it. Volatility would be historic, as sellers and buyers would be able to "get through" and place orders at an unbelievable speed, allowing for great trading action and potentially great profits and losses.

I do not know how the market triggers would hurt or help, but suffice to say, that traders and investors would not rely on those stop gap measures to see how and even if they would stem the declines. When I think about a 2004 market crash, it is not only scary but exciting as well, because nobody knows how it would look or feel. If its anything like surfing the web, I think the "Big Kahuna" will be an apt way for it to be described.