Data: US Investment Market Leverage Surges, Margin Debt to M2 Ratio Higher Than During the 2000 Dot-Com Bubble

BlockBeats News, December 21st. KobeissiLetter released data showing 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 these 7 months, U.S. margin debt has increased by $364 billion, a 43% surge. Adjusted for inflation, the margin debt increased by 2% month-on-month and 32% year-on-year, reaching a historical peak. At the same time, the proportion of margin debt to M2 money supply has soared to around 5.5%, the highest level since 2007. The ratio of margin debt to M2 is higher than during the 2000 dot-com bubble, indicating that the leverage in the U.S. investment market has reached extreme levels.

Trading margin debt refers to the total amount of debt that investors borrow from brokers 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 gains but also risks.