Wall Street Has a Serious Gambling Problem.

Wall Street Has a Serious Gambling Problem.

And no, I’m not talking about World Cup fever and betting on games, which you can now do on Robinhood (but not on other brokerage accounts). Gambling is fueling Wall Street’s rally, as margin trading hits an all-time high.
 
Is everyone trading on a whistle, a prayer and borrowed money, with FOMO spiraling in their brain? Could it all come crashing down, or will the fever send stocks even higher?
 
Here are the things we’ll discuss in this blog. I’ll be hosting a videoconference to discuss this more on Thursday, July 1, 2026 at 4 pm PT (7 pm ET). Email [email protected] with VIDEOCON in the subject line if you’d like to join me live.
 
Margin Levels to GDP are Historically High
Why Downturns are Swift and Sudden
How FOMO is Fueling Gains.
Will AI and Data Centers Save Us?
What is the Best Policy in a Highly Leveraged Debt World?
 
And here is more information on each topic.
 
Margin Levels to GDP are Historically High
Margin trading to GDP has never been higher as you can see in the chart below. If we look at some of the other high periods, there is a significant correlation with fast and furious plunges, as occurred in 2022, the pandemic, 2008, and during the Dot Com Recession.
 

Source: Google Gemini AI.

Between the high of March 2000 and the low of October 2002, the NASDAQ Composite Index dropped -78% – a million dollars sank to just $220,000. It took 15 years to crawl back to the highs of March 2000 (above 5,000). Margin trading today is even higher than it was then.
 

Why Downturns are Swift and Sudden
Corrections in stock prices can spiral and become a Snowball Effect largely due to the leverage and compliance ratios. When the price of a stock falls, the account owner may need to put in more cash to cover the losses. Some brokerages will automatically sell positions as the price starts plunging, to ensure that the account remains in compliance with the Federal Reserve Board Rules for margin trading. Account holders are unable to stop this process, but how many have read the fine print and are aware of this?
 
How FOMO is Fueling Gains
People who have been “waiting for the crash” for years are reaching out to our office and are now interested in investing again, even though stocks are at an all-time high. FOMO is real. This is an example of why we don’t want our emotions running our wealth plan.
 
Apocalyptic worrying is also real. When prices plunge, everybody thinks that they can never come back. Nobody wants to buy low. Few have the liquidity to buy low. In tough times, many are struggling to make ends meet and keep their home.
 
The Wall Street rule is to buy low and sell high. And yet, how many of us are tempted to buy high now? It is human nature to do the exact opposite of what we should be doing. This is why it is important to adopt time-proven wealth strategies that protect our principal, while increasing performance  – something our sample pie charts have been doing for decades.
 
Will AI and Data Centers Save Us?
AI and data centers have everyone excited about the economy. Even just a few weeks ago, when oil prices were high and we had wars and elevated uncertainty in the world, the excitement over the potential of these industries kept everybody invested. Retail investors leapt in, borrowing the money to do so, betting that an end to the war in Iran would make AI stocks soar. And yet, we have seen the technology stocks – including the Magnificent 7 that specialize in AI – go down in value. SpaceX is trading close to the launchpad of its IPO, while Amazon, Tesla, Meta and Microsoft are down -1.17%, -17.10%, -17.19% and -26.94%, respectively in 2026.
 
I’ll be publishing a mid-year performance blog next week. However, it’s important to remember that the highflyers can be the worst tankers in a correction. Check out the chart below from 2022 (another mid-term election year).

Source: Morningstar Direct, MSN.com, Coinbase, Kitco.

If artificial intelligence is so hot, why are the Magnificent 7 companies lagging Wall Street? Why is the technology-rich NASDAQ Composite Index down -6.7% from the high set on June 1, 2026 (before the most recent ceasefire with Iran)?
 
As my Wall Street friends are fond of saying, investing as easy. It’s just a question of what and when. AI is very exciting. The companies have great potential and products. The share prices crash because the valuations fly too high. Whenever companies have outlandishly expensive prices, the whales of Wall Street are going to take their profits. If a retail investor doesn’t understand price and price-earnings ratio, they could buy high into a promising industry and still lose money. That certainly happened in the Dot Com Era. It took a decade and a half of waiting to earn back the losses, even though many of those companies that suffered so severely are now the Magnificent 7 Blue Chips.
 
What is the Best Policy in a Highly Leveraged Debt World?
Market timing just doesn’t work. Wall Street has been hitting new highs almost weekly since the correction in stocks of 2022. That is one of the reasons why we have been using dollar cost averaging in our funds and hot slices. Even when the price is high, it can go higher. However, you don’t want to count on that happening. That’s why it’s also important to have an age-appropriate, diversified plan in place that is rebalanced 1-3 times a year.
 
The bones of an age-appropriate, properly diversified wealth plan are to:
 

• Always keep a percent equal to your age safe,
• Consider overweighting safe (or into risk) based on market conditions,
• Divide the at-risk side into 10 equity funds for diversification and performance,
• Invest the safe side in short-term high credit quality income-producing assets, and,
• Rebalance 1-3 times a year.

Sample Natalie Pace pie chart. All rights reserved.

This is the time-proven system we teach at our Financial Freedom Retreats. If you’d like to ensure that you capture gains at an all-time high right now, email [email protected] for pricing and information on my unbiased 2nd opinion of your current wealth plan. Most managed plans cost about 1.5% of your assets ($15,000 every year, per million). My 2nd opinion is a fraction of that cost to ensure that you are properly protected, with superior performance. Many of our hot funds and value replacements have far outperformed the S&P500. Our income strategies are earning a competitive yield with no paper losses.
 
If you’d like to personalize your own pie chart, you can use our free web app. Email [email protected] with Free Web App in the subject line for your complimentary link.
 
Bottom Line
Vegas has come to Wall Street. That is the headline that people should be reading, rather than Wall Street keeps hitting new highs. If we really knew how much people were gambling, would we be so worried about missing out?
 
In fact, a better strategy right now, when stocks are still at an all-time high, is to make sure that we have a plan for capturing gains. Now is the perfect time to get a 2nd opinion on your current wealth strategy, to ensure that you have an age-appropriate, properly diversified plan that is designed for superior performance. Whether you have a 401k or a managed plan, chances are there are many improvements to make. Email [email protected] to get started now. For anyone who has never done this, you will be capturing gains near an all-time high!


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​Are you aware that the hot funds we've been featuring in our sample pie charts and retreats performed at the top of Wall Street in 2025? Silver gained 141%. Peru (copper) was on fire with 83% gains. Even clean energy scored 44%... 

Why not treat yourself to the gift of financial freedom to create a New Year, New Me in 2026?
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Register now to join us at our online Financial Freedom Retreat Oct. 10-12 2026 where you'll learn how to protect your wealth, save thousands annually in your budget, invest in hot industries like AI, gold, crypto and more, and how to be in the best seat during our volatile Debt World. Register by June 30 to receive the best price and a free 50-minute private, prosperity coaching session (value $400). (Ask for access to a recording of our Wealth Secrets of the 1% masterclass as our gift to you.) Email [email protected] to learn more and register now.

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* Invest in hot industries, such as Nvidia, artificial intelligence, and chips,
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* Evaluate stocks,
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* Keep an age-appropriate amount safe, and,
* Know what's safe in a Debt World.

Yes, it's a complete money makeover. 
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Email [email protected] or call 310-430-2397 to learn more and register. Learn the 15+ things you'll master and read testimonials in the flyer on the home page at NataliePace.com. ​

"Ten minutes into the first day I was already much smarter about investing than I ever thought I would be in my life and I knew I was in exactly the right place at this retreat. I am amazed at how EASY and FUN it is to make my money work for me and those I love. I think this kind of information should be compulsory in schools. I wish I'd learned this sooner." CM
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neglect to follow simple and fundamental rules of the type provided [by Natalie]. 
This is why I recommend them with enthusiasm." 
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"College students need this information before they get their first credit card. Young adults need it before they buy their first home. Empty nesters can use the information to downsize to a sustainable lifestyle, before they get into trouble." 
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If you’d like an unbiased 2nd opinion on your current wealth plan, email [email protected] for pricing and information.

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Email [email protected] for pricing, additional information and to register. Register by June 30, 2026 to receive the best price and a complimentary, private prosperity coaching session (value $400).

Join us for our Restormel Royal Immersive Adventure Retreat. Spring Equinox 2027. Email [email protected] to learn more. Click for testimonials, pricing, hours & details. Register now to receive two 12-month all-access passes to our online training and four private, prosperity coaching sessions. There are only 3 rooms available. Considering the perks, you're receiving a 65% discount to learn the life math that we all should have received in high school, and the room is free! Email [email protected] to learn more. Yes, it's a great idea to register and start transforming our lives now with the online ABCs of money courses.

Natalie Wynne Pace is an Advocate for Sustainability Financial Literacy & Women's Empowerment. Natalie is the bestselling author of The ABCs of Money (6th edition) and The Power of 8 Billion: It's Up to Us, and is the co-creator of the Earth Gratitude Project. She has been ranked as a No. 1 stock picker, above over 835 A-list pundits, by an independent tracking agency (TipsTraders). Her book The ABCs of Money remained at or near the #1 Investing Basics e-book on Amazon for over 3 years (in its vertical), with over 120,000 downloads and a mean 5-star ranking. The 6th edition of The ABCs of Money and the 2nd edition of The ABCs of Money for College are the most recent releases of these books. Follow her on Instagram. 
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Natalie Pace's easy as a pie chart nest egg strategies earned gains in the last two recessions and have outperformed the bull markets in between. That is why her Investor Educational Retreats, books and private coaching are enthusiastically recommended by Nobel Prize winning economist Gary S. Becker, TD AMERITRADE chairman Joe Moglia, Kay Koplovitz and many Main Street investors who have transformed their lives using her Thrive Budget and investing strategies. Click to view a video testimonial from Nilo Bolden.​​

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Check out Natalie Pace's Substack podcast and watch videoconferences and webinars on Youtube.

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Important Disclaimers
Please note: Natalie Pace does not act or operate like a broker. She reports on financial news, and is one of the most trusted sources of financial literacy, education and forensic analysis in the world. Natalie Pace educates and informs individual investors to give investors a competitive edge in their personal decision-making. Any publicly-traded companies, funds or projects mentioned by Natalie Pace are not intended to be buy or sell recommendations.

ALWAYS do your research and consult an experienced, reputable financial professional before buying or selling any security, and consider your long-term goals and strategies. Investors should NOT be all in on any asset class or individual stocks. Your retirement plan should reflect an age-appropriate, diversified wealth plan, which has been designed strategically, with the assistance of financial professionals who are familiar with your goals, risk tolerance, tax needs and more. The "trading" portion of your portfolio should be a very small part of your investment strategy, and the amount of money you invest into individual companies should never be greater than your experience, wisdom, knowledge, patience and diversified strategy.  
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Information has been obtained from sources believed to be reliable. However, NataliePace.com does not warrant its completeness or accuracy. Opinions constitute our judgment as of the date of this publication and are subject to change without notice. This material is not intended as an offer or solicitation for the purchase or sale of any financial instrument.