I dipped in too. However, at the moment I'm choosing not to buy individual stocks, but to buy shares in listed investment companies. Some of these are trading a long way below the value of the shares I hold. I bought about $20k worth of CIN today. In essence, for $22.50, you get a basket of (typically blue chip, dividend yielding) shares with a nominal value of about $27.00 I figure I'm getting exposure to an extra 20% shares this way. And the MER is on par with the better ETFs in Australia, at about 0.12%. Gross yield is currently about 5.4%, and its only paying out ~70% of the dividends they receive, so some reinvestment for increased future cash flow, even if the dividends of its holdings are zero.
Gearing 50/50, I put in $10,000 of my money. Borrow another $10,000 at 1.15% through IB. Gross income, $1080/year. Less $115 in interest = $965 pre-tax income, or 9.65% on my original $10k. Even after being done over by the ATO at 38.5% (or worse once gillard/swan introduce some more levies), its still almost 6% post tax, assuming stock prices go nowhere. I'll take that sort of return any day!
(of course, do your own research. For example, CIN has a concentrated ownership in AHD, which looks like a cross-share ownership, and if the Australian dollar really tanks, I'm up for exchange rate losses. And of course, using margin has the potential for a margin call and total wipeout of capital). But on balance, I'm happy to wear those risks!