It’s All Relative

“Did you like it?”

The answer to one of the most common questions in the world is not just about whether you liked the thing in question. Your response will depend on reality exceeding or falling short of expectations. How did you like it relative to how you thought you would like it?

One of my colleagues told me he enjoyed the new Jurassic Park movie and I absolutely could not believe it. He didn’t love it, more like a “hey it wasn’t so bad.”

I almost refused to believe him. Like literally I could not believe it. And then another colleague of mine had the exact same response. Like exactly the same. “I mean it wasn’t good, but it wasn’t that bad.”

This had me shaken.

Two things going on here. First, movies on airplanes are 30% better than movies on your couch. There’s nothing to distract you, and there’s not much else you could be doing. It’s not like you wasted two hours watching a piece of crap when you could have done literally anything else. In an airplane, there are three choices- sleep, read, or watch something.

The second and main determinant of them not hating a very bad movie was their expectations. The movie got lambasted by everyone, myself included. Jurassic Park is one of my favorite franchises. It would be difficult for there to be a dinosaur movie that I didn’t like. And I really, really didn’t like the new Jurassic Park. So my colleagues were expecting horrible, and I guess through that lens, terrible is actually pretty good.

I’m big into expectations versus reality, but I think even I underestimate how foundational this is to everything whether it’s books or movies or trips or food or anything really.

So I tried something on the flight home. I had no interest in watching Morbius. I’m a fan of superhero movies, but I was not wasting my time with this one. 15% from critics on Rotten Tomatoes, 5.2 on IMDB, and 35% on Metacritic. No thanks.

But after being shocked that my two colleagues liked an objectively awful movie, I decided to put the expectation game to the test. I watched Morbius and I was  surprisingly entertained. The reality is this movie was terrible, but it wasn’t horrible, and the small gap between the two made me like it.

And this is what makes investing  so hard. Markets don’t move on good or bad, they move on better or worse, specifically better or worse than expected. The tricky, nay impossible thing is you don’t know what’s expected until you see the market’s reaction.

The other day I saw this tweet from Sean Fennessey

Mindful of the no-expectations thing, I did it. At least the first part. I don’t know how to find a crowded theater. I saw it with a total of two other people. Obviously for Sean to tweet something like this, I suspected I was in for a treat, but in order to not taint the experience, I took his advice and saw it blind without knowing a single thing about it.

Holy shit. This movie was absolutely wild. If you’re a fan of demented horror, I cannot recommend it enough. And Sean’s right. The less you know about this movie the better.

It’s going to be a week in the markets. We’ve got the Fed on Wednesday and the market is pricing in an 82% chance of 75 bps. With respect to the fed funds rate, we do know what the market is expecting, but we don’t know if it will like it.

This content, which contains security-related opinions and/or information, is provided for informational purposes only and should not be relied upon in any manner as professional advice, or an endorsement of any practices, products or services. There can be no guarantees or assurances that the views expressed here will be applicable for any particular facts or circumstances, and should not be relied upon in any manner. You should consult your own advisers as to legal, business, tax, and other related matters concerning any investment.

The commentary in this “post” (including any related blog, podcasts, videos, and social media) reflects the personal opinions, viewpoints, and analyses of the Ritholtz Wealth Management employees providing such comments, and should not be regarded the views of Ritholtz Wealth Management LLC. or its respective affiliates or as a description of advisory services provided by Ritholtz Wealth Management or performance returns of any Ritholtz Wealth Management Investments client.

References to any securities or digital assets, or performance data, are for illustrative purposes only and do not constitute an investment recommendation or offer to provide investment advisory services. Charts and graphs provided within are for informational purposes solely and should not be relied upon when making any investment decision. Past performance is not indicative of future results. The content speaks only as of the date indicated. Any projections, estimates, forecasts, targets, prospects, and/or opinions expressed in these materials are subject to change without notice and may differ or be contrary to opinions expressed by others.

The Compound Media, Inc., an affiliate of Ritholtz Wealth Management, receives payment from various entities for advertisements in affiliated podcasts, blogs and emails. Inclusion of such advertisements does not constitute or imply endorsement, sponsorship or recommendation thereof, or any affiliation therewith, by the Content Creator or by Ritholtz Wealth Management or any of its employees. Investments in securities involve the risk of loss. For additional advertisement disclaimers see here: https://www.ritholtzwealth.com/advertising-disclaimers

Please see disclosures here.