Humans and computers complicit in crash

Institutional investors are, by nature, quite conservative. Whether they are pension plan managers trying to keep their clients' livelyhoods secure or mutual fund managers working in the interests of their investors, large funds tend to avoid risk as much as possible. With the ITS lagging up to two hours in reporting prices through the market, institution managers were operating in an information vacuum. With no information except clear signs of a panic on the floor, their conservative nature led them to join the flood of sellers. This is a clear example of a set of systems which "proved quite effective over the long run" under normal circumstances, but broke down in extraordinary conditions and unprecedented loads. Had ITS kept institutional investors abreast of actual prices, they might not have speculated about the level of the crisis (naturally assuming the worst) and might not have ordered their brokers to "sell at any price."