Margin debt in 2014 is DOUBLE that of 2010

Use this link to see how margin debt (i.e. debt used to buy stocks) grew since 2010.  Scroll down to the bottom and you can see that it was $233.6 billion in Jan 2010.  In Jan 2014 it was $451.3 billion.  That is only a few billion shy of being double.  Since then it has eased back to $437.1 billion as the smart money has been edging for the door.   All of these folks effectively naked shorted the dollar by going long stocks with borrowed money.  As interest rates rise, these guys will want OUT of these loans in a hot hurry.  The contracting debt will strengthen the dollar and cause more of a short squeeze for the margin boys.

If you want to know why shares skyrocketed since 2009, don't look to the boomers.  They got their asses handed to them and will never recover from the drubbing they got back then.  I think many boomers have called it splitsville with the equity markets.  They are probably kicking themselves for not catching the big ass bounce since 2009 but they will eventually breathe a sigh of relief as shares will eventually create  lower low.  Misery loves company don't you know.

OK, tables of numbers are fine but how do we know that the peak is really in?  Why can't the borrowing continue on and on and on for years to come?   For that we need to see the data in chart form which appears below.  Right now I'm assuming this is a corrective bounce and thus a-b-c not 1-2-3.  But in either case, a massive margin debt pullback is indicated to AT LEAST the level of the prior 4th wave.  Far more likely is that the concept of using debt to buy stocks with is going to cripple the global banking industry so badly in the coming years as stocks go into "last man out is a bag holder" mode that new laws and limits (Glass-Stegall II) will be imposed on the bankers. 

Once this happens the con men and thieves will no longer be able to leverage up using our savings and checking account to back their market bets.  When that stops, the stock markets will be dead for decades to come.  Without massive leverage by bankers, who is going to buy into a collapsed stock market??  Boomers?  I don't think so.  They will be spending their retirement money, not gambling it.  Young people?  Sure.  As soon as the 30 somethings move out of their parents house and get a job they might have something to invest.  Face it, the concept of investing is structurally wounded unless massive leverage is in play.

Be sure to check out the C wave of that margin debt since Elliott waves seem to apply to everything in the universe.  5 clear waves up so far.  Clear alternation between waves 2 and 4.  Parallelism between 1-3 and 2-4.  Wave 3 is the strongest of the series and even though the monthly resolution does not provide enough detail, you can see that wave 3 seems to have 5 sub-waves in it. 

Without the presence of ever increasing of debt, a debt Ponzi is doomed.  These stocks were all bid up using debt and without more and more debt being used to bid them higher and higher, the margin service (the cost of borrowing money to speculate in markets) will eat the gamblers alive due to the extreme leverage tricks they are using.  So you see, a debt Ponzi cannot just have a Permanent Plateau of Perpetual Pleasure and Prosperity.  No my friends, the game of the Ponzi is grow or die and this margin debt chart is most likely rolling over right here, right now.