It was a perfect September day in Chapel Hill, unseasonably cool with zero humidity and clear Carolina blue skies. The afternoon gradually faded into a beautiful evening as thousands of giddy Carolina fans marched down to Kenan Stadium for the debut of a new era of Tar Heel football. A half moon decorated the sky as the team took the field amid fireballs and explosions while Michael Jordan and Lawrence Taylor looked on. Roy Williams gave a regal wave. The era of Bill Belichick— wearer of eight Super Bowl rings—had begun. Kenan Stadium was as electric as it was gorgeous.

An impressive opening drive touchdown served to validate all the Belichick hype, all the drama surrounding his hiring, all the speculation over his curiously young companion, and all the high expectations for the North Carolina football program. Those expectations had just become reality, and there was jubilation.

It lasted about half an hour.

The Horned Frogs of Texas Christian University dominated the Tar Heels, winning the game by a score of 48 to 14. By the time the fourth quarter arrived, the previously giddy Tar Heel fans were fumbling for their car keys as they trudged up the aisles toward the exits.

Embarrassingly, one could not help but compare this hubris-driven implosion to Mike Krzyzewski’s disastrous last home game at Cameron Indoor Stadium, his team dominated by Carolina in front of all the stars in the Duke basketball universe. How soon one forgets.

High expectations are a terrible curse. They were for Coach K four years ago, and they were for Carolina fans on Monday night. They almost always are. They rob future accomplishments of deserved acknowledgement, twisting future enjoyment into mere relief. The higher the expectations, the more difficult it is to experience success.

Of course, high expectations are a burden for investors, too. It doesn’t take a mathematical genius, or even a football coaching genius, to observe that high expectations, in the form of high prices paid for assets, work against future returns. They don’t guarantee poor outcomes, but they make the odds longer.

Major equity market indices are trading near all-time highs. Across the board, but especially in large-cap tech, stock prices are unusually expensive. Since 1990, the S&P 500 has only been more expensive on a price/earnings basis during the dotcom era and during the stimulus-powered pandemic rally. This does not mean we are facing an imminent market downturn, but it does mean that near-term returns must contend with high hurdles.