Margin debt as a % of GDP just hit an all-time high.
4.0%. Higher than August 2021. Higher than March 2000. Higher than July 2007.
Every previous peak on this chart preceded a major drawdown:
โ June 1968: end of the Nifty Fifty bull
โ Aug 1987: Black Monday
โ March 2000: dotcom crash
โ July 2007: GFC
โ Aug 2021: the 2022 bear market
The chart doesn't predict the future. It predicts who can't sit through it.
Leverage doesn't kill you when you're right.
It kills you when you have to sell at the wrong time.