What is even reality?

Another ridiculous question, but its true. If we think more about it, what is even real? There's this book inside The Elder Scrolls V: Skyrim called Reality and Other Falsehoods. The passage says: "...first accept that reality is a falsehood. There is no such thing. Our reality is a perception..."

Well, I think we rarely experience reality directly. We experience our interpretation of reality. We see what happened, process it through our knowledge, assumptions, fears, and desires, and then call the result “reality”. Two people can observe the same event and walk away with two completely different realities.

What business and private equities has taught me about this?

Financial markets have taught me that perception can become reality.

A company may have strong revenue, healthy cash flow, and good products. But if investors believe the company has no future, its valuation can collapse.

Another company may have little revenue, continuous losses, and an uncertain product. But if investors believe it will dominate the future, its valuation can rise.

Which one is real?

Is the real value of a company its assets? Its profits? Its future cash flow? Its stock price? Or what people are willing to pay for it today?

Perhaps all of them are real in different ways.

So, what is reality?

I don't know, well, let's have a coffee and talk about that instead.