uploaded image

Truth Or Skepticism: Bull Market Fallacy

By:Mike Butler

Tom & Dylan reunite for another segment of Truth Or Skepticism! On this episode, the guys discuss the recent spike and decline of volatility, and how this market is in a weird place. Jumbotron stocks are exploding from earnings announcements, but executives of some of those very same companies are selling their shares of stock. What gives? Check out the preview of the full segment below!


What would you rather put away for 10 years right now, seven shares of NFLX or an ounce of platinum?
— Tom Sosnoff

Tom & Dylan are perplexed by the huge moves in jumbotron stocks. Tom believes it is more of a bubble situation than anything, and believes over time these stocks will come back to earth and normalize. It just adds to the list of red flags he sees in this bullish market, and gives him even more reason to be short.

Can the intrinsic value of a multi hundred billion dollar entity change by fifty billion dollars in ten minutes?
— Dylan Ratigan


Is the rate of decay in the vix an indication of a more efficient market or a complacent market?
— Dylan Ratigan

Dylan compares the VIX to a high performing car. It revs up quickly, and revs down just as quickly. They discuss whether this is an effect of complacency, or if it is just a normalized asset. Tom believes it is a normalized asset.

Volatility generally contracts ⅔ of the time, and expands ⅓ of the time, but when it expands, it expands quickly.
— Tom Sosnoff


Has the fed become an anti-intellectual organization?
— Dylan Ratigan

Tom & Dylan discuss the bull market fallacy, and how it seems that the dumber you are, the better you perform. ETF’s have been ripping up consistently, and leading people to believe that what goes up, must not come down. Dylan ponders on a potential safe haven play, and asks why that is not getting long stocks like GOOG, NFLX, etc.

Do you WANT to buy stocks at an all-time high as a safe haven play?
— Tom Sosnoff


The companies that are creative with their models (GOOG, FB) do very well. The other companies that are not still do well, but not as well.
— Tom Sosnoff

Dylan wonders how buybacks and dividends affect the future of companies today. Tom is worried that if there are not deals that can be made to improve / shift business, things are either overpriced or the model has changed so dramatically that you have to buy things for the future.

If the most intelligent thing a company can do with retained earnings is buybacks and dividends, then there’s a much bigger problem.
— Dylan Ratigan


Can the Chinese government re-inflate its own stock market?
— Dylan Ratigan

The guys finish off this segment by discussing China, and the interesting turn of events that have played out over the past few weeks. Tom is interested to see just how much more they can pump into the economy, as they have already pumped a couple hundred billion into it. Dylan spins the question into a comparison of what’s scarier - the thin ice China is on or the passive American investor?

This is a unique situation because the marketplace is not mature, and they do not have the same infrastructure here, and not nearly the same liquidity
— Tom Sosnoff

To see earlier episodes of Truth or Skepticism with Dylan Ratigan, you can watch them here on the tastylive archives!

Options involve risk and are not suitable for all investors. Please read Characteristics and Risks of Standardized Options before deciding to invest in options.

Related Posts

tastylive content is created, produced, and provided solely by tastylive, Inc. (“tastylive”) and is for informational and educational purposes only. It is not, nor is it intended to be, trading or investment advice or a recommendation that any security, futures contract, digital asset, other product, transaction, or investment strategy is suitable for any person. Trading securities, futures products, and digital assets involve risk and may result in a loss greater than the original amount invested. tastylive, through its content, financial programming or otherwise, does not provide investment or financial advice or make investment recommendations. Investment information provided may not be appropriate for all investors and is provided without respect to individual investor financial sophistication, financial situation, investing time horizon or risk tolerance. tastylive is not in the business of transacting securities trades, nor does it direct client commodity accounts or give commodity trading advice tailored to any particular client’s situation or investment objectives. Supporting documentation for any claims (including claims made on behalf of options programs), comparisons, statistics, or other technical data, if applicable, will be supplied upon request. tastylive is not a licensed financial adviser, registered investment adviser, or a registered broker-dealer.  Options, futures, and futures options are not suitable for all investors.  Prior to trading securities, options, futures, or futures options, please read the applicable risk disclosures, including, but not limited to, the Characteristics and Risks of Standardized Options Disclosure and the Futures and Exchange-Traded Options Risk Disclosure found on tastytrade.com/disclosures.

tastytrade, Inc. ("tastytrade”) is a registered broker-dealer and member of FINRA, NFA, and SIPC. tastytrade was previously known as tastyworks, Inc. (“tastyworks”). tastytrade offers self-directed brokerage accounts to its customers. tastytrade does not give financial or trading advice, nor does it make investment recommendations. You alone are responsible for making your investment and trading decisions and for evaluating the merits and risks associated with the use of tastytrade’s systems, services or products. tastytrade is a wholly-owned subsidiary of tastylive, Inc.

tastytrade has entered into a Marketing Agreement with tastylive (“Marketing Agent”) whereby tastytrade pays compensation to Marketing Agent to recommend tastytrade’s brokerage services. The existence of this Marketing Agreement should not be deemed as an endorsement or recommendation of Marketing Agent by tastytrade. tastytrade and Marketing Agent are separate entities with their own products and services. tastylive is the parent company of tastytrade.

tastycrypto is provided solely by tasty Software Solutions, LLC. tasty Software Solutions, LLC is a separate but affiliate company of tastylive, Inc. Neither tastylive nor any of its affiliates are responsible for the products or services provided by tasty Software Solutions, LLC. Cryptocurrency trading is not suitable for all investors due to the number of risks involved. The value of any cryptocurrency, including digital assets pegged to fiat currency, commodities, or any other asset, may go to zero.

© copyright 2013 - 2024 tastylive, Inc. All Rights Reserved.  Applicable portions of the Terms of Use on tastylive.com apply.  Reproduction, adaptation, distribution, public display, exhibition for profit, or storage in any electronic storage media in whole or in part is prohibited under penalty of law, provided that you may download tastylive’s podcasts as necessary to view for personal use. tastylive was previously known as tastytrade, Inc. tastylive is a trademark/servicemark owned by tastylive, Inc.