Charlie’s lesson here is that a combination of supersmart people and large amounts of leverage often ends in disaster. I might add that the combination of really dumb people and large amounts of leverage usually ends in disaster as well.
Smart or dumb, avoid or minimize leverage. When used, short term and paid back quickly. Long term leverage is crippling.
Overconfidence leads (smart) people to think they can beat the odds and make a big bet doing so for big upside. Maybe that’s true, but the downsides can be terminal.
