Yesterday's stock market plunge—the Dow was down nearly 1,000 points and some stock traded at nearly 100% below their usual level—is now being investigated by the SEC. Bloomberg News reports, "U.S. regulators plan to examine whether securities professionals triggered yesterday’s stock- market plunge or exploited the turmoil to profit illegally." Securities professionals trying to exploit turmoil for profit? Shocking.

Even though there are legitimate factors to market jitters, such as the Greek debt situation, it's widely believed that a trader's error—typing in a "b" instead a "m," creating a trade for $16 billion instead of $16 million—spurred the sell-off. The head of U.S. derivatives at Capstone Global Markets, Tim Freeman, told CNBC, "We're [treating] it as a trader error. It was not me, thank God. I would be in a bar in New York City drinking that one off." The Wall Street Journal described:

Multiple stocks, ranging from Accenture PLC to Boston Beer Co., momentarily lost nearly 100% of their value, changing hands for just one penny. Exchange-traded funds, which are index funds that trade like stocks on exchanges, were also temporarily vaporized. The $9.5 billion iShares Russell 1000 Value Index Fund went from $59 to around 8 cents in the blink of an eye...

Major exchanges said they will cancel erroneous trades that occurred during the selloff.

The NY Times says, "The glitch that sent markets tumbling Thursday was years in the making, driven by the rise of computers that transformed stock trading more in the last 20 years than in the previous 200." Georgetown business school professor James Angel said, "We have a market that responds in milliseconds, but the humans monitoring respond in minutes, and unfortunately billions of dollars of damage can occur in the meantime." (I'm afraid, Dave.) The Times adds, "One official said they identified 'a huge, anomalous, unexplained surge in selling, it looks like in Chicago,' about 2:45 p.m. The source remained unknown, but that jolt apparently set off trading based on computer algorithms, which in turn rippled across indexes and spiraled out of control."

Investor Jim Rogers told CNBC, "Somebody should hang this New York Stock Exchange. They claim to be the center of the world's capitalism, of the world's financial markets, you would think that in 2010 they could sort out simple things like electronics."