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Data: US Investment Market Leverage Surges, Margin Debt to M2 Ratio Higher Than During 2000 Dot-Com Bubble
Summary: According to reports, KobeissiLetter released data showing that in November, US trading margin debt surged by $300 billion, reaching a record high of $1.21 trillion, marking the 7th consecutive month of increase. Over the 7-month period, US margin debt increased by $364 billion, a 43% increase. Adjusted for inflation, margin debt grew 2% month-on-month and ...
According to reports, KobeissiLetter released data showing that in November, US trading margin debt surged by $300 billion, reaching a record high of $1.21 trillion, marking the 7th consecutive month of increase. Over the 7-month period, US margin debt increased by $364 billion, a 43% increase. Adjusted for inflation, margin debt grew 2% month-on-month and 32% year-on-year, reaching historic highs. At the same time, the ratio of margin debt to M2 money supply soared to around 5.5%, the highest level since 2007. The margin debt to M2 ratio is higher than during the 2000 Dot-Com Bubble, indicating that the leverage in the US investment market has reached extreme levels.
Trading margin debt refers to the total amount of debt investors borrow from brokers to purchase stocks or other securities in securities trading, allowing investors to amplify their investment size with less of their own capital, thereby increasing potential returns but also risks.
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Link: Data: US Investment Market Leverage Surges, Margin Debt to M2 Ratio Higher Than During 2000 Dot-Com Bubble [Copy]
