Sometimes, it takes more energy to argue than it's really worth. Like, if someone's coming at you with a thought that makes absolutely no sense, you'll often find out that they'll go to any lengths to convince themselves that they've figured it all out.
I mean, we all say dumb stuff from time to time and a good friend can bring you back down to reality, but this type of thing can have its limits. Sometimes, they've already done all the mental gymnastics and all you can do is give them their gold medal.
Just a warning, though. If you ever find yourself presenting your big theory on everything and all someone can say is "oh, really?" and "that's interesting," then this might be your award ceremony.
Just be sure to recognize it before you disappear down the rabbit hole and you'll be fine.