Sometimes you attend a course, meet the requirements just to get the certificate, not to learn anything genuinely. It could be that you already knew everything the course had to teach and the certificate was a physical label required to prove that; or you could be just more interested in showing others you are something rather than truly being that.
This sense that you fork out the cash, check the boxes and then gain what you were showing up for is certainly appealing. And the economy is always selling you on the dream and ability to do that. Over many cycles, the connection between the certification and the underlying thing it indicates disappears. And we are left with confused signals – more generally known as noise; and confused people.
The same thing happens to the markets. There are financial metrics, performance indicators and other forms of signals which were like certificates that companies had to prove their worth. There are lots of forms to file, financial reports, investor communications. But soon the companies become more interested in the proof of worth than their real worth. So valuations go crazy, price signals become more like noise and a lot of metrics become worthless.
As investors, we are feeding the frenzy when we want to be those course participants who throw their money, show up and expect that magic happens to ensure they are properly equipped with whatever the course claims to be able to teach or make them out to be. We want to check the boxes of the investments and then earn our returns and be done with it.
When the culture is moving us to a place we don’t want to go, let’s choose not to subscribe to it. Especially when we can envision a different future, a better one.
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