Notable Bear Isn't Betting Against The Market

David Tice of Tice Capital is one of the stock market's most notable and vocal bears. His own website even highlights the dangers of "investing near the end of a secular bull market" yet at the same time he believes an equally dangerous trade is betting against the bull market and going short.

The reason for what appears to be mixed logic is quite simple, Tice explained during a recent CNBC "Trading Nation" segment. The stock market is being supported by central banks across the world with zero or even negative interest rate policies. Moreover, central banks are also in activities that have never been seen before by "buying stocks because they essentially ran out of bonds."

Needless to say this is "dangerous" but without any sign of changes coming, the bull rally can go on for quite some time, Tice added. Meanwhile, stocks are trading near all-time high valuations and an encouraging economic backdrop and ongoing earnings momentum could extend the bullish stock market.

"Most bear markets begin at a level of extreme froth," which doesn't describe the current environment, Tice emphasized. "Therefore it's possible — as much as I hate to say it — this market could go a little bit higher."

Bottom line, although stocks are looking "dangerous," it would be foolish to be short today.

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