Markets aren’t just numbers. They’re theater. And the most expensive tickets are always to the show called confidence.
Think about it. Every earnings call is staged like a play. Executives stride onto the stage, armed with carefully rehearsed lines, graphs that slope politely upward, and body language that whispers “trust us.” Analysts, like critics, scribble notes in the dark. Traders, like theatergoers, cheer, boo, or walk out early.
Confidence is less about truth and more about performance. Investors don’t buy spreadsheets; they buy the narrative that a company can deliver. Elon Musk didn’t get Tesla to a trillion-dollar valuation by handing out balance sheets like playbills. He sold a vision — an act of storytelling that bent the market’s mood to his script.
Psychologists call this the confidence heuristic: we tend to trust the person who sounds certain, even when certainty has nothing to do with accuracy. Politicians use it. CEOs weaponize it. Markets amplify it. (Harvard Business Review has a great primer on this effect).
The problem? Every theater has an intermission. Markets eventually dim the lights, and the props get tested against reality. That’s when illusions crack. We’ve seen it with Theranos, WeWork, and meme stock CEOs promising rockets to the moon. Curtain up, curtain down.
So what’s the trader’s role? To enjoy the performance — but never forget it’s a performance. You can applaud the play while keeping your wallet in your pocket. Confidence can move prices in the short run, but over time fundamentals write the script’s final act.
Here’s my rule: when the spotlight burns brightest, squint. That’s when the shadows are deepest.
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