PALO ALTO (CNN/Money) - The gamblers are leaving the casino. Impossible, you say -- the stock market always has been a place for speculation and always will be.

But since before the Depression, the true problem gamblers are those who load up on debt to make their bets. And debt, as measured by margin debit balances in New York Stock Exchange member firms, followed a steady upward trajectory during the boom years of the 1990s. As the markets rose, investors borrowed more dough to fund their speculation.

Want to take a guess as to when margin debt peaked? That's right, in March 2000, not coincidentally when the Nasdaq crested. In that month, investors were in debt to the tune of $278.5 billion to fuel their stock-market obsession.

So here's the good news, released Friday morning by the Big Board. Debit balances in July hit a level last seen in October 1998, a time of another downturn in the markets. Margin debt in July stood at $136.2 billion, down 7 percent from June.

Make no mistake, this doesn't signal the all clear. Even if the marked decline in margin debt does represent a bottom, it doesn't say squat about where the markets are going.

In fact, few of the many "bottoming" signals you'll see written about prove anything about what comes next, as I argued in a recent article in Fortune. It merely suggests that those who like to play with more than they've got have been washed out enough that they're staying away from the table more these days.

This, as Martha Stewart once was fond of saying, is a good thing. We're entering an era where 30 years from now old fogeys will be boring youngsters with comments like, "I remember the bubble of the late 1990s, and I'll never quite trust the stock market again." The bubble was caused in no small part by amateurs borrowing money -- from willing securities-firm lenders -- and bidding each other up on the stocks they were buying on margin.

Where might be a good level for margin debt to bottom, suggesting that an "appropriate" amount of debt is being deployed? That's hard to say, because according to figures provided by the New York Stock Exchange, margin debt rose steadily from 1992 to 2000, pretty much without taking a breather.

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Having said that, though margin debt levels have returned to their October 1998, levels, the broad market has fallen to it's January 1998 levels. In that month, margin debt was around $127.8 billion. Perhaps if margin debt falls again in August to a level commensurate with the market's decline, the situation will be in equilibrium.

Adam Lashinsky is a senior writer for Fortune magazine. Send e-mail to Adam at lashinskysbottomline@yahoo.com.

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