What We Can Learn From Margin Levels In The Stock Market | Seeking Alpha

What We Can Learn From Margin Levels In The Stock Market | Seeking Alpha



This is an interesting article about how margin calls affect the stock market.  When the next bear market finally arrives, broker margin calls will cause an avalanche decline in the market.  As the author noted, margin peaks can also predict an imminent bear market, and that is where we are now.  People are leveraged to squeeze all they can out of small general stock market gains.  Eventually, the gains will be so small that bonds will be more attractive, and then the market will fall as people sell stocks aggressively.