Debt is fine as long as you are A. not overgeared B. it can be...

Debt is fine as long as you are A. not overgeared B. it can be managed via cashflow and C. and your don't become a distressed seller during a market down turn. Essentially, Bond was a distressed seller in the example you provided.

IMO when you take on too much debt you are no longer the master of your own destiny which would let you ride out any market revalution, you are in fact a pawn of your finacers. Make use of debt at your peril.

Rule number 1 in investing. Don't borrow money you don't need. If you're borrowing money you're getting greedy and will pay the price when the market slows.

http://en.wikipedia.org/wiki/Long-Term_Capital_Management#1998_Bailout