How quickly the options world changes. Remember back in the good old days when the market didn't move, yet the VIX priced as if it did? And the VIX futures traded at decent and persistent premiums to "cash" VIX, suggesting that even overpriced volatility wasn't overpriced enough.

Well, those days are gone. We now officially have a market moving 2% a day, a flyinig VIX, and VIX futures that (for now) must consider this a blip as they trade with a $2 discount (in November) and a $3 disount (in December).

Now we all know what happened in 2008. The VIX kept flying and the market kept getting plowed. And in fact, that's likely why the VIX is pretty quick to get pumped these days. But generally, this kind of spike in fear is very bullish. Trading the Odds tweeted all sorts of interesting stats Friday. Such as this.

w/$VIX up > +25%, $ES_F closed higher on 14 and lower on 5 occurrences since 1990 (but on 14 out of the last 16 occurrences, and last 8).

And this.
 

w/$VIX up >+20%, since 1990 $ES_F lost more than -0.75% on only 1 out of 34 occurrences next day, and not more than -0.50% on the last 30.

And this.
 

I haven't been this bullish since October 2007.

Okay, the last one was me quoting what some trader I'll call "Eddie" would have said on Friday.

But seriously, it's one of those situations where unless you're expecting a crash, odds and just seeing this movie before suggest this got a bit extreme.

An important point to remember is that buying spiked volatility is often not a bad idea. In other words, let's say you're of a mind to go long. Buying ATM-ish calls at pumped volatility is not a bad idea. If you catch it right directionally, it won't matter if you sell it out at a lower volatility as the intrinsic value of the option will soar. If you're dead wrong and we crash ... well, you'll be happy, too, in that you lost less than a stock buy.

The only time you'd regret owning options over stock is if we flatline and volatility comes back to earth. To me, that's the least likely outcome here.