Wall Street: Room at the Top

For the seventh time since World War II, the Federal Reserve Board last week made it harder for investors to buy stock with borrowed money. It did so by raising the so-called margin requirements from 50% to 70%—meaning that to pick up $1,000 worth of listed stock, an investor will have to put down at least $700. The Fed's seven governors, who often split on other matters, voted unanimously for the "precautionary" boost. But they passed the word around that they plan no further movement of margins for quite a time.

Why the increase last week? The Fed believes that the...

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