Unsophisticated investment practices are running wild. For example, stock tips are rampant and many people buy solely on the strength of these tips. One of the fundamental rules of sound investing teaches not to buy stocks on tips or rumors. If you own stocks, you know how prevalent this practice is.
Margin buying is at record levels.
This is another violation of basic investment advice. Everyone has heard not to buy stocks on borrowed money. In addition to borrowing from their brokers, people are using the proceeds of home refinancings, bank loans, credit card loans, and installment loans to buy more stock. Everyone's in the market. They say that in 1929, even the shoe-shine boys were passing out stock tips.