The tendency of many people who are overconfident is just the reverse of Munger’s use of a “too hard” pile. In other words, people with a high IQ often relish the opportunity to solve hard valuation problems, thinking that they will be rewarded for having such ample mental skill with a higher return. The reality is that, in trying to solve hard problems, emotional and psychological problems cause the losses rather than a lack of intelligence. Hard problems are hard problems, pregnant with opportunities to make mistakes.
