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The Box Spread Trick: Get rich slightly faster

Your scenario seems totally different from the one described in the post. You're keeping the $200K loan in your brokerage account (not withdrawing it) and plowing it back into the risk asset (not a risk-free CD); then imagining only an 18% decline (not 28%).

OP's liquidation scenario occurs with a $200K liability against $252K equity in the brokerage account (following the 28% decline from the original $350K). The brokerage let OP withdraw the $200K, but then can't assume he still has it.