If somebody read the book, I'd like to understand what he means. Why does he think people are generally so optimistic, and what is the math he's referring to?
The math he refers to is simply high school level probability math.
All you need is high school mathematics and a sense of realism.
He's saying rather than putting everything on red because you are optimistic you should figure the odds of red are 18(18+18+2) and your expected return on a dollar is 95c.
Of course things like should I punt on a startup are more complicated than roulette but you can maybe benefit from looking at what proportion of similar ones succeed and that kind of thing I guess.
Han Solo: "Never tell me the odds!"
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C3-Po has the habit Munger recommends. Han is probably an incorrigible optimist.
I was supposed to link to this post (got kinda lazy and wanted to get this summary out) - will do so once it's ready!