In conceptual metaphor, "good" is "up" and "bad is down." How does that fit with the waterfall metaphor?
Because Good Is Up, time-based graphics like stock charts show the desirable direction (more value for a stock) as up.
So what does this convey?
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Something is going down, in the direction of badness. It's like the Fall in Genesis or Plato's Allegory of the Cave.
That naturally makes us think the results of top-level phases are more important than the result of something like "coding," way down there toward the end.
Coupled with our Platonist training that the abstraction is more "real" than the concrete realization, this makes the actual code – the product someone is paying for – seem unimportant (and therefore not worthy of much attention or effort).
If I could go back in time, I’d have told Royce to draw his diagram with a U shape, with the requirements and code at the top, on opposite sides of the U. To my mind, the two most important things in software are the requirements – the understanding of why you’re doing this at all – and the code, which is the actual thing people can use.