The Dow just lost 200 points. Hey, pass me a beer, will ya?

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From Times staff writer Walter Hamilton:

So trading volume is very light in the stock market, there’s minimal news -- and the Dow Jones industrial average is down more than 200 points.

Yep, must be vacation time on Wall Street.

Many traders are lounging on beaches in the Hamptons this week rather than slumping over computer terminals in lower Manhattan. The annual pre-Labor Day Wall Street diaspora is here, when much of the financial center hollows out.

The result is thin trading volume -- and sometimes big swings in stock prices on seemingly inconsequential news.

‘Light volume makes the market more vulnerable to the smallest breeze,’ said Alan Gayle, investment strategist at RidgeWorth Capital Management in Richmond, Va.

Veteran traders are the ones most likely to be absent, and the junior people manning the trading desks are under strict orders not to take risks, Gayle said. That can tend to push stocks down, he said, because no one wants to step into a falling market, watch it go even lower, then have to fess up to a big loss when the boss returns.

‘If you’re a junior guy, more than likely there are a lot of instructions that already have been made about not taking a lot of bets in this particular market,’ Gayle said.

At the closing bell today, the Dow was off about 240 points, or 2.1%, to 11,386. Once again, financial stocks led the market lower after brokerage Credit Suisse said additional mortgage-related write-downs may push insurance giant American International Group into the red in the current quarter.

AIG was down $1.08, or 5.4%, to $18.79, a new 13-year low.

Beyond that, not much is going on. Oil prices were up a bit and the dollar was flat.

Of course, the market is never far away from the Hamptons, figuratively speaking. Even when big Wall Street players are on vacation, they’re still tethered to the market via cellphones and Blackberrys, notes Hugh Johnson, chief investment officer at Johnson Illington Advisors in Albany, N.Y.

‘Those who are in the Hamptons can still stay in pretty close contact with their trading desks,’ Johnson said. ‘I don’t attach as much significance anymore to the fact that it’s a traders’ vacation week. It’s still a factor, but it’s not as much of a factor’ as in bygone times.

This year, maybe it’s the market itself that really needs a vacation, not the traders.