Paint the Table

[JXM]

The VIX is the Implied Volatility of a number of OEX options. The site can probably explain it better than I, but I will give you my particular interpretation (mileage may vary).

Because the market has a bullish bias (an example would be that there are more people who go long stocks than there are those who go short), when there is complacency, there is less demand for put options. With less demand, those who are selling options can demand less premium on those options. So generally speaking when there is a low VIX it is a good time to buy options because the premiums are low. But when there is fear in the market, there is a lot of demand for puts and there the premiums go up. This would be a good time to sell puts so that you can get the extra premium.

When everyone has given up, there is rarely complacency. There is usually desperation and fear. The link can explain it far better than I.