Margin Debt at Record High: Market Overheating Risk Grows

According to Real Investment Advice, the share of margin debt in the US's real disposable personal income has exceeded 6.0% for the first time.

This is more than twice the peak during the dot-com bubble in 2000.

Key Data:
— Nominal margin debt reached a record $1.2 trillion
— The indicator has been rising for 8 consecutive months

Historically, such spikes in debt load in the stock market have often ended with:
— Deep corrections
— Sharp declines in indices
— Forced reduction of leveraged positions

Growth in margin debt increases market vulnerability to negative triggers, as any price decline can trigger a cascade of liquidations.
#CelebratingNewYearOnGateSquare