WARNING🚨
THE MARKET MAY BE OPERATING ON BORROWED TIME (AND THE SIGNAL IS VERY CLEAR)
🩸This is similar to the CRASH of 1929, 2000, and 2008
👀There is an indicator that has ALWAYS been present before the major crashes in history… and today it has reignited strongly.
📊It is not a stock
📊It is not an ETF
📊It is not a bond
👉It is MARGIN DEBT
What exactly are we talking about⁉️
▪️Margin debt is the money that investors borrow from brokers to buy stocks
▪️It is pure leverage
▪️When it rises too much, the market becomes fragile
🧨And the data is compelling
▪️Margin debt in the U.S. surpassed $1.28 TRILLION, one of the most extreme levels in history
▪️This is the 8th consecutive month of increase in margin/leverage debt in the American market
▪️In fact, over the last 8 months, margin debt has increased by +45%, the largest increase since the "meme stock fever" of 2021
▪️Meanwhile, the SP500 remains close to historical highs
Where is the problem⁉️
👉The problem is NOT just the level
👉The problem is the SPEED
▪️Margin debt is growing more than twice as fast as the stock market
▪️Historically, when leverage grows much faster than the value of assets, the system becomes unstable
📉This happened before the CRASH of:
▪️1929
▪️2000
▪️2008
👀Another even more concerning fact
▪️If we subtract margin debt from cash in investment accounts, the balance is NEGATIVE at -$814 BILLION
▪️This means that investors owe nearly $1 TRILLION MORE than they have in cash
👉That is extreme leverage
👉That is a total absence of margin/safety liquidity
Why is this so dangerous⁉️
▪️When everyone is leveraged, no one has liquidity to buy dips
▪️A small drop can trigger liquidations, that is, forced sales
▪️These sales generate more drops