Data: US Investment Market Leverage Surges, Margin Debt to M2 Ratio Higher Than Dot-Com Bubble Era

BlockBeats News, December 21st, KobeissiLetter released data that in November, the U.S. trading margin debt surged by $300 billion, reaching a record high of $1.21 trillion, marking the 7th consecutive monthly increase. Within 7 months, U.S. margin debt increased by $364 billion, a 43% increase. After adjusting for inflation, margin debt increased by 2% on a month-on-month basis and 32% year-on-year, reaching a historical high. At the same time, the proportion of margin debt to the M2 money supply has soared to about 5.5%, the highest level since 2007. The ratio of margin debt to M2 is higher than during the 2000 dot-com bubble, and the leverage ratio in the U.S. investment market has reached absurd levels.

Trading margin debt refers to the total amount of debt that investors borrow from a broker to purchase stocks or other securities in securities trading, allowing investors to amplify their investment scale with less of their own funds, thereby magnifying potential returns but also risks.