Big oopsy

A six-year-old story about United Airlines' bankruptcy filing has resurfaced, provoking investor panic and wreaking serious havoc on United's stock price (UAL) — at least for a day.

Who took the heat for it? Mostly Google News.

Here's what happened:

The original Chicago Tribune article from 2002 was published in the "Popular Story" section of South Florida Sun-Sentinel's website, where Google News purportedly picked it up.

It was then seen by a securities analyst perusing the newspaper's website. He sent the article to Bloomberg News in the form of a one-liner: "United Airlines files for Ch. 11 to cut costs."

The news, which spread from thence, triggered a flurry of panic as investors shook UAL off their portfolios. As a result, the stock price plummeted to $3 a share from its previous $12.

The shares, along with those of carriers like Continental and American Airlines, eventually rebounded after Wall Street realized the news was inaccurate, reports the LA Times. But investors that sold during UAL's extreme lows took a blow: NASDAQ refused to forgive the trades resulting from the panic.

Angry investors are not sure who exactly was to blame for this gaff:

• Google maintains that the article did not appear on its News headlines, only that it was only made searchable on the site. Google also said the only clear dateline on the story read September 7, 2008, making it impossible for its news crawler to perceive the article as old news.
• The Tribune refutes Google's argument, contending the article clearly showed the date. (See Silicon Alley Insider's retrieved screenshot of the document.)
• The analyst who regularly trawls content for the Income Securities Advisors newsletter thought the story was fresh because a Google search found the story on the current Sun-Sentinel page, which included news about Hurricane Ike. A closer reading of the article would have revealed its true date.

What's the moral to be learned? You can't count on the algorithm, you can't count on the human, and you certainly can't count on the methods used for information distribution.

But perhaps the lesson is simpler than that, quips Valleywag: Simply don't believe everything you read on the internet.