Know Your Risk Podcast It's a Bubble, But the Tech is Real
Oct 7, 2025
Explore the current market landscape as rising VIX levels signal caution amid a backdrop of investor euphoria. Delve into the implications of AI on tech valuations and discover how unprecedented risk-taking is reshaping investor behavior. Zach highlights the allure of gold and mining assets as potential safe havens, while emphasizing the need for selectivity in investments. Learn how international tech offers lower valuations compared to U.S. giants and why keeping an eye on macro factors is crucial for sound decision-making.
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VIX Rising With Rally Is A Warning Sign
- Rising VIX during a bullish rally signals investors are buying insurance despite market gains.
- That divergence is abnormal and merits caution about market complacency.
Rally From Here Looks Like A Blow-Off
- A big rally from current levels likely signals a euphoric blow-off top rather than a sustainable advance.
- Dollar degradation alone probably won't justify a perpetual U.S. market surge, given past dollar strength.
AI Creates A Company-Level Imperative
- AI is fueling a valuation bubble for tech even though the technology itself is real and strategic for firms.
- Corporations must overspend on AI capex for survival, which drives market froth even if returns are uncertain.