Ideas
Regional banks/BDCs face credit stress
He sees funding stress in the financial system: record SRF borrowing, weak regional-bank equities, and private-credit issuance blowups. He specifically warns that private credit is not marked to market and may hide bad debt, and later says regional banks and BDCs are signaling something significant beneath the surface, making them risky to own.
Imminent VIX spike from leverage
Over the short term he expects an imminent VIX spike because of excessive leverage, record call-trading volume, leveraged ETF launches, heavy margin debt, and widespread overconfidence as everyone is bullish into year-end. He says timing is unknown, but the conditions are set for an air pocket or tail event.
Long-term bullish equities on deregulation
Longer term he remains bullish on stocks because deregulation is a disinflationary, underappreciated tailwind that should create sector rotation and new leadership. He explicitly says he is not a perma bear and that long-term equity prospects are positive even though he expects volatility along the way.
Deregulation ETF FMKT is long-term bullish
He launched The Free Markets ETF (FMKT) to express the deregulation theme. He argues deregulation lowers inflation by increasing competition and speeding products to market, and he says FMKT has outperformed the S&P since launch despite not owning tech or AI.
Fed cuts steepen Treasury curve
He expects a steeper Treasury yield curve as the Fed cuts short rates while inflation pressures keep the long end elevated. The exception is if credit weakness metastasizes into a deflation scare and triggers a flight to safety.
Prefer BBB over high yield
He says investors can still earn money in high yield, but it is like squeezing blood from stone and the risk/reward is asymmetric because layoffs could cause default risk to suddenly rise. He prefers BBB/higher-quality bonds, and says if conditions get very nasty, long-duration Treasuries become the only thing that works.
Prefer BBB over high yield
He says investors can still earn money in high yield, but it is like squeezing blood from stone and the risk/reward is asymmetric because layoffs could cause default risk to suddenly rise. He prefers BBB/higher-quality bonds, and says if conditions get very nasty, long-duration Treasuries become the only thing that works.
Bearish large-cap tech versus defensives
He is more bearish on large-cap tech relative to Treasuries and defensive sectors. The market is a concentrated AI-led market, valuations and earnings expectations are stretched, and he argues gravity eventually returns to valuations, especially after recent earnings disappointments.
Bombed-out defensives offer alpha
He points to healthcare and consumer staples as bombed-out defensive sectors relative to the S&P. Nobody wants defensives, and if large-cap tech weakens, these sectors can deliver real alpha and relative outperformance, with some deregulation beneficiaries also helping.
Avoid crowded AI bubble
He describes the market as a concentration bubble and says the way to play it is not to be in where everyone else is, specifically Nvidia and AI plays. He questions circular AI deals where money moves back and forth to the same entities, and says if AI does not generate real earnings and revenue, it will be called a bubble in hindsight.
Housing risks nasty recession
Housing could be entering a nasty period after a prolonged stretch of insane pricing. Lumber, a key housing input, has cratered, and he says some argue a housing recession may be starting and housing remains a big economic question mark.
Gold is momentum, not safe haven
Gold has shifted from institutional safe-haven demand to a speculative retail momentum trade. It has not acted like a risk-off asset this cycle and has been more correlated with equities; if there is a real tail event, he thinks long-duration Treasuries would do better than gold.
Utilities remain defensive risk-off sector
Utilities still behave like a risk-off sector. Although AI power demand is a popular bull argument, utilities have not outperformed as much as that narrative would imply, so he still views them as defensive.
Dollar and yen stay defensive
With gold no longer acting as a reliable risk-off asset, he says the US dollar and Japanese yen remain defensive currencies that should provide safe-haven support in a risk-off environment.
Flying-car deregulation benefits Archer, Joby
He cites FAA deregulation around flying cars as a specific deregulatory tailwind. Archer Aviation and Joby are two stocks in the FMKT ETF because of that deregulatory push.
EPA deregulation boosts Comfort Systems
EPA cuts and deregulation have been a big tailwind for Comfort Systems (FIX), which he calls one of the biggest winners and larger holdings in the Free Markets ETF.
This The David Lin Report video, published November 05, 2025,
features Michael Gayed
discussing KRE, BDCS, VIX, SPY, FMKT, TLT, LQD, HYG, XLK, XLV, XLP, AIQ, HOUSING, GLD, UTILITIES, FXY, USD, ACHR, JOBY, FIX.
16 trade ideas extracted by AI with direction and confidence scoring.
Speakers:
Michael Gayed
· Tickers:
KRE,
BDCS,
VIX,
SPY,
FMKT,
TLT,
LQD,
HYG,
XLK,
XLV,
XLP,
AIQ,
HOUSING,
GLD,
UTILITIES,
FXY,
USD,
ACHR,
JOBY,
FIX
