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Pastimes : CNBC -- critique.
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To: HandsOn who wrote (7498)3/17/2001 12:13:07 PM
From: Thomas M.  Read Replies (1) of 17683
 
In 29 with 5k in a margin acct. You could trade with 100k, reason people were jumping out of windows.

Margin hasn't changed a bit since the 1920s. First of all, only ~2% of the population owned stocks. Maybe 0.5% traded on margin. Of those, most traded on far less than 90%. 90% margin was for bucket shops, where your losses were limited by automatic stop orders, and for businesses. Basically, trading on huge margin was only available to an exclusive few - just like today. Derivatives allow unlimited leveraging, a la LTCM, to those privileged few who have access to them.

Tom
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