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Strategies & Market Trends : Bob Brinker: Market Savant & Radio Host -- Ignore unavailable to you. Want to Upgrade?

To: Boca_PETE who wrote (13243)	3/19/2001 8:52:52 AM
From: Kirk ©	Read Replies (2) \| Respond to of 42834

But if easy margin money did not cause the NASDAQ bubble, just what did ? Easy MasterCard money ? Unrealistic expectations and a long period without normal down periods so many never understood what "risk-reward" really means. There is a rather large community of multimillionaires near me that come from Taiwan, own multimillion dollar homes without mortgages and were buying stocks here as their home stock markets tumbled. Some are my friends and I would TRY to explain valuation... but try and explain why "Cisco is too expensive" when it is "only $50" compared to MSFT that was $60 or why stocks that split are not cheaper when.... you get my drift. Margin debt was what percentage of the total market capitalization? Back in 1929, margin debt was the majority of the markets value since the limits were 90%. What numbers are we talking these days for Margin Debt and what is total market cap? Maybe it caused a pimple, but not a bubble. I think Brinker's point was that Greenspan wanted to protect the little guy and yet that was just the person that was hurt when the market crashed and margin calls were made. Well, I think it is a nice sentiment and makes for good radio (sort of like Art Bell and UFOs) but the reality is the little guy would charge his groceries on Visa to get cash for the market if he really wanted to so what Greenspan did was kept a reasonably priced source of credit available to the little guy so he didn't have to go to his local bookie and pay 10% a week to gamble on the market.