Imagine the following situation:
You have a material open in the Inspector, and you want to assign a texture to it.
This texture is located in a folder.
You navigate to this folder in the Hierarchy, and in order to opeen the folder, you have to click it.
The Inspector is designed in such a way that if you click something, it will show its contents.
This means that if you click the folder, the Inspector will show the empty (which makes no sense. Why would you want to inspect a folder?)
Now that you've opened the folder and found your texture, you notice that the Inspector no longer shows your material, but the folder.
In order to assign the texture to the material, you have to find the material again and click it so that it finally shows again in the Inspector.
This is a stupid work that nobody should have to do.
The solution would be simple:
The Inspector should simply ignore clicks on a folder and instead keep showing the last GameObject.
That what this feedback is for.