• March 2000 was the beginning of the Dotcom Bust, during which the S&P 500 fell by 50% and the Nasdaq by 78%.
• July 2007 was just before the stock market started tuning into the beginning of the Financial Crisis, during which the S&P 500 fell by 56%.
• May 2018 was followed by a 20% decline in the S&P 500 by late 2018.
• October 2021 led to a 25% decline of the S&P 500.

[T]his is what it looks like from the leverage point of view, and it’s scary: A massive spike in risk-taking and excessive speculation in the stock market, as demonstrated by this multi-month spike in margin debt from record to record, that is creating big vulnerabilities and risks.

In the long-term view of margin debt, such as in the chart above, it’s not the absolute dollar amounts that matter, but the steep spikes in margin debt from new high to new high over a multi-month period.