Markets don't wait around, they react.

Markets don't wait around, they react.

This week, the VIX spiked 50% to levels not seen since April's tariff panic. Thursday alone the Dow swung from up 700+ points to deep red in hours. No earnings disaster. No policy shock. Just a recalibration of what investors are willing to pay.

Here's what the chaos revealed:

😨 Multiples move at the speed of fear. Companies didn't suddenly become less profitable this week. But with the market-to-GDP ratio hitting 217% (a record that screams overvaluation), investors blinked first.

📉 The cost of capital shifts in real time. Powell hints at pausing rate cuts, and suddenly every stock's discount rate effectively jumps. No Fed meeting required. Everyone adjusted their DCFs and “wham-o!” stocks start to slide en masse.

🧮 Risk premiums aren't background noise. Everyone’s seen that tech multiples now mirror early 2000s dot-com levels, and when that confidence cracks, traders don't sit around and debate – they adjust. Risk premium up, valuations down. It's arithmetic, not sentiment. It’s business and not personal.

♣️ The bottom line: It’s been a good year, and this was just one week of pull-back so don’t go trading in all your chips just yet. But rallies built on expanding multiples are fragile by design. This week reminded us what's actually holding up prices – momentum and hope.

At least Friday ended up (mostly). Here’s to a better week next week! 🙏