NASD sounds alarm on margin buying

Discussion in 'Wall St. News' started by S2007S, Apr 11, 2007.

  1. S2007S


    NASD sounds alarm on margin buying
    By Aaron Siegel
    April 11, 2007
    NASD has issued a warning to investors about the dangers of margin buying, as the amount of debt U.S. investors took on rose to a record $321.2 billion in February.

    The figure topped the previous record of $299.9 billion in March 2000, at the peak of the last bull market, according to Reuters.

    Margin debt has more than doubled from $141.3 billion in January 2003, three months after the bear market bottomed out.

    The self-regulatory organization’s latest investor alert comes as many American homeowners are unable to keep up with their mortgage payments. Delinquencies hit 4.95% in the fourth quarter, compared with 4.67% during the third quarter, according to the National Delinquency Survey released by Mortgage Bankers Association released last month.

    "We are concerned too many investors are unaware they could suffer substantial financial losses by using debt to purchase securities," said Mary L. Schapiro NASD chairman and chief executive, in a statement.

    "By updating our alert on this topic, we hope to remind investors not to underestimate the risks involved."
  2. it can make a new high for the next two years before a mini crash comes about.

    same thing happned back in 1929.

    margin debt was trading at record highs for a good 18 months and making new highs each month.

    you try shorting this market.

    its impossible.
  3. Yup, Hopeless. I went to cash.

    Silly to be long waiting for the axe.

    Silly to be losing money short waiting for it.