Most people think in a straight line: "This is a great company, I should buy the stock." Marks calls this . He argues that because everyone else sees the same "great company," the price is already high, leaving no room for profit.

: When the bubble burst, those who ignored risk were destroyed. Marks’s defensive investing strategy—prioritizing the avoidance of losses over the pursuit of maximum gains—allowed him to preserve capital while others lost everything. The Core Lessons of Uncommon Sense

Here is a solid story of how that uncommon sense works in the real world: The Secret of Second-Level Thinking