Margin of Danger

"Look at these people. Wondering around with absolutely no idea of what's about to happen."
--Peter Sullivan (Margin Call)

Margin debt now at record levels--north of $800 billion. Margin debt is increasing at its fastest rate since...2007. And before that...1999.

The unfortunate reality is that leverage works both ways. It magnifies gains on the way up, and creates elevator shafts on the way down. It also shortens time horizons, as price swings make investors jumpy.

Easy money courtesy of the Fed, as usual.

Lotta Robin Hooders think they're borrowing their ways to riches...until Sherwood Forest catches fire.