Although professionals are able to extract a considerable amount of wealth from amateurs, few stock pickers, if any, have the skill needed to beat the market consistently, year after year.

There are some conditions where you have to trust your intuition.

Lucky risk takers use hindsight to reinforce their feeling that their gut is very wise. Hindsight also reinforces others' trust in that individual's gut.

Policy makers, like most people, normally feel that they already know all the psychology and all the sociology they are likely to need for their decisions. I don't think they are right, but that's the way it is.

We are far too willing to reject the belief that much of what we see in life is random.

Unfortunately, skill in evaluating the business prospects of a firm is not sufficient for successful stock trading, where the key question is whether the information about the firm is already incorporated in the price of the stock. Traders apparently lackthe skill to answer this crucial question, but they appear to be ignorant of their ignorance.

That's one of the real dangers of leader selection in many organizations: leaders are selected for overconfidence.