Tyler Durden's picture

Things in the 'economy' must be good - investors are nearing their most levered long to US equities ever. As Sean Corrigan notes, Net Margin (defined as NYSE Margin Debt minus Mutual Fund Liquid Assets) is within a hair of its all-time record high and relative to the March 2000 peak in the Wilshire 5000 (broadest US equity market cap), we are rapidly approaching 'peak' exuberance levels. Indicatively this should make sense since the market is at all time highs, but it is so because of central banks, not because of individual investors. So why would the investors themselves be just as stretched as the global central banks, and how does this leverage upon leverage unwind in the end?



Source: Diapason Commodities

Comment viewing options

Select your preferred way to display the comments and click "Save settings" to activate your changes.
vmromk's picture

Stretched ?

Bernanke and his fellow criminal cohorts at the "fed" should be stretched on a medieval rack until they are ripped to shreds.

Divided States of America's picture

Not as stretched as the fuckin grin on LORD BLANKFIEND's greedy face..doesnt CNBShit have anything better to show than watching this Jbag criminal explain why he is doing God's fuckin work for everyone's good sake????

Headbanger's picture

It's the advertisers who want that BS so the sheeple will buy, buy, buy their crap

flacon's picture

So we can go higher? 

Keynesian Mess's picture

Best profile picture I've seen yet!


Thanks for the chuckle.

Jekyll_n_Hyde_Island's picture

S-T-R-E-T-C-H-E-D   then   SNAP!

mayhem_korner's picture



My friend from Knoxville used to spike punch with Everclear at college parties (he always let me know).  Each time, without fail, there would be about a 4x multiple of semi-conscious bodies than at a normal bash.

Leverage will (again) have the same effect once the punch bowl is empty.

SheepDog-One's picture

Seems like the perfect time yet again to whipsaw the muppets, pull the rug out, and take them for all they've got.

Colonel Klink's picture

How's it gonna end?  With a BANG, then a whimper from all those to lost everything, then another BANG!

Cult_of_Reason's picture

Instead of telling GS propaganda lies on CNBC, Blankfein needs to be hang upside down (to improve supply of blood to his head, so it takes longer before he passes out) with his legs bound apart and being slowly (so he feels and sees the blade work its way slowly to his heart) cleaved in half by two dudes with a massive saw -- starting from the genital area and slowly working down through his body until he dies of massive pain and blood loss.

Rip van Wrinkle's picture

Blood? Blankfein is human? Some f*ckin' chance!!

Cult_of_Reason's picture

Sawing Blankfein like this and showing it on CNBC live.


Or any one of these methoods (the only one I am not sure about is using rats, because rats might not eat another rat)


smlbizman's picture

with lord and god, lloyd blankfein being interviewed are we suppossed to stand or bow or not eat meat until he is done, anyone...?

Divided States of America's picture

smallbiz, just be in awe of the half human half squid explaining how he singlehandedly fixed the financial crisis in 2008 (but not mention that the Fed made GS a bank holding company and was given billions upon billions by Timmy boy)

mick68's picture

I'm in Canada and recently one of the biggest distribution magazines ran a 10 page article on how the bull market is just getting started, but noted the lack of buy in by average investors. The last 5 pages did nothing but try to persuade people to get into this market or be left behind. Literally, they used that teriminology.


Since when do the powers that be want to/need to persuade people to get into a legitimate bull market?

NEVER!! It's a FRAUD!!!

Divided States of America's picture

Dude, Larry Fuckin Fink, Warren Geezer Buffett, Jeremy Schmegal Siegel have all been doing the same on CNBShit....but we all know how much truth that comes out of those fuckers.

philosophers bone's picture

Yes, I think I know which one you are referring to - MacLeans - headline was "BUY!"   The writer and the editors should be embarassed.  Pages and pages about the bull market and how it is likely just getting started and not one peeop about quantitative easing or the Federal Reserve.  The sheeple don't have a chance....

101 years and counting's picture

but, Pomo money is coming into stocks 4 out of every 5 days.  so, why the need for leverage?

Divided States of America's picture

They need the leverage because it is masking the massive dumping by company insiders.

Macleans eh? I dont think any smart Canadian read that shit anymore.

swmnguy's picture

But, but, but...1600 S&P is within reach!  It's got to be good!

Besides, when you know you can fob off all your losses onto the Fed via buybacks and phony accounting, there's no risk, so why not lever up?

buzzsaw99's picture

But, but, but...1600 S&P is within reach!

must... ring... bell... ugh... got it!!

machineh's picture

So are I'm Yellen' for Janet! lapel buttons.

Dr. Engali's picture

I'm in the market for a dow 4000 hat.

Jason T's picture

get to work Mr. Chairmen.. we're all loaded up to our gills.  

shit it's gonna end badly.  

maskone909's picture

Tyler loves South Park!  classic episode

Captain Benny's picture

Rookie Mistake - Inferring affection through reference.

If a "Tyler" loves South Park, he'll say so.  Simply referencing pop culture should never be misinterpreted as affection.

ParkAveFlasher's picture

Tyler simply references South Park!  classic episode

Dollar Bill Hiccup's picture

In response to the last question : very quickly.

Captain Benny's picture

"Need MOAR buyers!!!!"

Jonas Parker's picture


"Need MOAR suckers!!!!"


There, I fixed it for you...

buzzsaw99's picture

Where's that dumbass who was talking about market cap?

mattdubz86's picture

But but but but were in a new secular bull market, all is well.

Jonas Parker's picture

Famous words prior to October, 1929 - "This time it's different!"

Dr. Engali's picture

Look at this fucking police state we live in! A 16 year old girl gets two felony charges for doing a science project in school. Not only that but the idiots publish her fucking address. What a bunch of cock suckers.



Shell Game's picture

Long watcher cams, Short school Volcano projects.


/s  fucking fucked up...

logicalman's picture

Leverage on leverage can only end one way.

I'm just amazed at the can kicking abilities of TPTB.

Dr. Engali's picture

"Leverage on leverage can only end one way"


With moar leverage?

prains's picture

except when the rock you're trying to move gets bigger and the stick over the fulcrum gets thinner. snap

The Dancer's picture

Doc, Name calling never accomplished anything...talking the talk is easy...walking the walk...now that's something!

venturen's picture

What me worry....nah!

polo007's picture

According to Canaccord Genuity:



We have been anticipating a correction over recent weeks, and we see no reason to change that view. Our reasons for expecting a pause in the upside remain tactical in nature because the fundamentals that have driven the rally since the 2009 low continue to be in place. We expect a correction because (1) the equity market is near-term overbought and somewhat extended above its 200-day moving average, and (2) the current move higher is the second longest without a 5% correction since the 2009 low. A 5% correction from the recent peak of would bring the SPX very close to our 1500 near-term correction target. As you all know, we believe the intermediate-term fundamental, historical and tactical framework command buying the equity market on any correction – especially one that is +/- 5%. Our 2013 target remains 1760, which assumes a 16 multiple on $110 EPS for the SPX.

Definition of insanity. Before we convince you there could be a 5% correction, we need to convince you the backdrop remains so favorable for domestic equities that any weakness should be used as an opportunity to add exposure. Remember that corrections are only natural, normal and healthy until they actually happen. The definition of insanity is doing the same thing over and over, but expecting a different result. The fundamental drivers of the equity market have not changed throughout this entire cycle, yet many continue to find reasons they won’t work. Those favorable drivers have been:

1. Low core inflation (Figure 1),

2. Historically accommodative monetary policy as seen in the real Fed Funds rate (Figure 2),

3. Improving money availability and steep yield curve (Figure 3),

4. Slow but positive economic activity,

5. Directionally positive EPS and upward trend in valuation levels.

Investing is not an academic study. Is it a cause for concern that the Fed is artificially keeping rates lower than where they should be? Not based on the past four years. Continued deceleration in core inflation is giving the Fed cover to keep rates abnormally low, which improves the availability of money that leads to positive growth for the economy and therefore corporate America. The very smart-sounding counter to these factors are weak domestic economic and employment growth, a meaningful slowdown in growth in China, and the recessionary environment in the Eurozone. These factors are real, and over the past few years they have caused corrections, but have not been the ultimate driver of stocks – the guys printing the money have. We try not to get wrapped up in whether that is right or wrong because it just is what it is – practically positive for domestic equities.

venturen's picture

Stretched Valuations show confidence in the recovery....MOAR!

Chippewa Partners's picture

Blankfein ........paying homage to Draghi is like Corzine paying homage to Madoff.

ziggy59's picture

Even the best, most elastic rubberbands when stretched to their limit, will snap

firstdivision's picture

Less than 2 points bitches.  Let's all join in the equity fun. 

sbenard's picture

Dr. John Hussman recently made this same observation in his weekly market commentary. He further noted that record high margin debt is a leading indicator of a market top, because when the inevitable collapse occurs, leveraged investors will be forced to sell, either willingly, or unwillingly, as margins calls wreak their havoc on bubble-driven markets.

ebworthen's picture

Has to be close to time for them the crash the mother fucker again.

It all depends on how much "leverage" they want to rake from Mom and Pop this time around.

Free money from the FED and Treasury, muppet slaying, incresed costs and fees for everything - pretty good run for Wall Street and Washington since 2008.  Bonuses, bribes, and bubbles.