Large margin debt supporting the Ponzi
The market may go higher or may go lower from here. There are plenty of indications that we are in a topping process. There are some signs that the market could run higher in the short term. And who knows, maybe that becomes a longer term.
However, a strong capital base is an essential foundation for economic growth. And asset appreciation. And based on this chart from Zero Hedge, we’ve got a lot of margin froth supporting this market. When margin calls hit, things drop fast. Point being… if/when we hit the tipping point where a “correction” triggers enough margin calls, it’s going to get ugly again. Just like 2000. Just like 2008. It’s something worth remembering when Playing the Ponzi.