Japan’s government rebuked the Tokyo Stock Exchange and one ofthe country’s biggest brokerage firms Friday after a typing errorcaused Mizuho Securities Co. to lose at least 27 billion yen ($225million) on a stock trade. The error roiled the Japanese market,while jitters over the reliability of the exchange’s trading systemcontributing to a 1.95 percent drop in the benchmark Nikkei 225index Thursday. The Nikkei rebounded 1.45 percent Friday to finishat 15,404.05, but the mishap triggered concern among some tradersjust a month after an embarrassing glitch at the Tokyo exchangeshut down the market for almost an entire day. The trouble beganThursday morning, when Mizuho Securities tried to sell 610,000shares at 1 yen (less than a penny) apiece of a job recruiting firmcalled J-Com Co., which was having its public debut on theexchange. It had actually intended to sell 1 share at 610,000 yen($5,041). Worse still, the number of shares in Mizuho’s order was41 times the number of J-Com’s outstanding shares, but the TokyoStock Exchange processed the order anyway. Mizuho says it tried tocancel the order three times, but the exchange said it doesn’tcancel transactions even if they are executed on erroneous orders.By the end of the day, Mizuho Securities — a division of thenation’s second-largest bank, Mizuho Financial Group, Inc., hadlost at least 27 billion yen ($225 million). That total could rise,however, Mizuho Securities spokesman Hideki Sakuma said Friday,adding that the mishap was sparked by human error. Japan’sFinancial Services Agency, the country’s financial watchdog, beganan immediate probe into what went wrong and how to prevent arepeat. “In order to maintain the credibility of the Tokyo StockExchange, I very strongly want this issue to be resolved quickly,”Economy and Banking Minister Kaoru Yosano told reporters Friday.“The first thing for the Financial Services Agency to do is todetermine what happened in detail. Based on that, we will decidewhat is needed based on the rules and regulations.” “We need tothink more about putting safety measures in place to preventconfusion,” Prime Minister Junichiro Koizumi told reporters Friday.Chief Cabinet Secretary Shinzo Abe said the Finance Ministry wasworking with Mizuho and the Tokyo Stock Exchange to formulatecountermeasures for the future. J-Com’s shares debuted at 672,000yen ($5,600) on the Tokyo exchange’s Mothers market and plunged to572,000 yen ($4,767). But a big buy bid placed after MizuhoSecurities’ sell order helped lift J-Com to 772,000 yen ($6,433) atthe close. According to a Ministry of Finance filing, MorganStanley ended the session with a 31.2 percent stake in J-Com. TheTokyo Stock Exchange suspended trading of J-Com on Friday, butdeclined to specify how it will sort out a mess created by thebotched order. But news reports have suggested the exchange maycancel the order through penalty payments, borne by Mizuho. Many ofthe sell orders have yet to be carried out, meaning further tradingcould “cause instability in the market,” the exchange’s managingdirector, Tomio Amano, said at a news conference. The botched tradecomes at a sensitive time for the Tokyo exchange, which has surgedon record volume, spurred by buying from foreign investors. ForMizuho Securities, the news is even worse. Mizuho Financial Groupsaid it would fully back its security arm’s losses from erroneoustrades of J-Com. But the red ink could wipe out Mizuho Securities’profit of 28 billion yen ($233 million) for the fiscal firstquarter that ended in March.

please discuss how the trading system in the Tokyo StockExchange could be revised to prevent such mistake and loss fromhappening in the future? (If you think it can not be prevented,why?) Please list your suggestions systematically, e.g. using1,2,3, etc.