Organizations that take the word of overconfident experts can expect
costly consequences. The study of CFOs showed that those who were most
confident and optimistic about the S&P index were also overconfident and
optimistic about the prospects of their own firm, which went on to take
more risk than others. As Nassim Taleb has argued, inadequate appreciation
of the uncertainty of the environment inevitably leads economic agents
to take risks they should avoid.