What’s worse, “we are often confident even when we are wrong,” writes Daniel Kahneman, in his masterful new book on psychology and economics called “Thinking, Fast and Slow.”

An objective observer, he writes, “is more likely to detect our errors than we are.”

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That $164 billion merger disaster defined a decade of thoughtless deal making, reckless ego and vaporous “synergy.”

But for Hollywood executives and bankers now toting their iPads like baby blankets, the new technology has brought them back to an old conversation about “content” and its distribution.

Just as cable-television upended the distribution of films and television, so too are increasingly mature digital platforms like 20 million-customer Netflix or even Google Inc.’s YouTube. As these platforms spar with cable-operators and media conglomerates for consumer attention, they are finding it increasingly necessary to differentiate themselves.

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Look instead on the market’s margins, where a new set of tech companies is racing to attract public investors before the warm, buzzy feeling wears off.

That’s where a curious document was released Friday afternoon: The initial-public-offering papers for a company called Skullcandy, Inc., issued by top-tier underwriters at Bank of America-Merrill Lynch and Morgan Stanley.

You probably try to avoid things called Skullcandy. Your kids think otherwise. Lately, they may have been pestering you for a pair of Skullcandy headphones for their iPhones. These headphones are typically stamped with bright colors and large skulls, presumably to enhance parental annoyance.

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Today, three of Verizon’s most significant divestitures are either in bankruptcy or near it. As they say on Wall Street, it all depends on what side of the trade you’re on.

Verizon’s former yellow-pages unit, which goes by the ungainly name of Idearc, sought court refuge from creditors in May; Verizon’s former Hawaiian telecom franchise, purchased by Carlyle Group, filed for bankruptcy in December, and FairPoint Communications, which absorbed landlines from Verizon in a complicated divestment, is close to going under, the company said in a July securities filing. In all, these companies have lost upward of $13 billion in value and counting.

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Here are two pieces this week, from the multitude of them about the continuing turmoil at Yahoo (YHOO), that really stand out for me.

Both encapsulate the dicey situation that the troubled Internet company finds itself in now–which is to say very dicey.

One from The Wall Street Journal’s Dennis K. Berman–titled “Who Played It Worse: Microsoft or Yahoo?”–comes to the only conclusion: Both.

Wrote Berman: “Never have so few failed so many for so much at stake.”

Money quote on Yahoo, referring to its ad-outsourcing deal with Google (GOOG):

Consider the state of Yahoo now: Thrust into the arms of Google, it now is forced to admit it can’t develop the technology to compete head-on with the Googleplex. It is as if IBM were to admit it could no longer build a big server, or Toyota were to give up on the Corolla and start selling Honda Civics.”

But a more devastating indictment of Yahoo and its CEO and Co-Founder Jerry Yang comes from New York Times columnist Joe Nocera, called “Oh, Jerry, It’s No Longer Your Baby.”

While Nocera, whom I know and admire, is not saying anything new about Yang’s glacial management of the company and Yahoo’s boneheaded handling of the Microsoft (MSFT) situation, his bracing prose in the form of a poison pen letter sums it all up perfectly.

Wrote Nocera, as he shoved the shiv in: “I haven’t seen this much contempt for shareholders since Robert Nardelli [pictured here] ran Home Depot.”

After recounting the sins against Yahoo shareholders, here’s the money quote:

Jerry, you’re a billionaire because people all over the world bought your stock, and trusted you to do right by them. That’s the compact you make when you take a company public: you get to be really rich, but in return, you have an obligation to do everything you can to ensure that shareholders get a healthy return on their investment. It doesn’t matter that you would like Yahoo to remain independent, or that you can’t stand Microsoft. Your feelings aren’t supposed to get in the way of your fiduciary duty.

A takeover by Microsoft was your last, best hope of rewarding your long-suffering shareholders. Now that opportunity is gone. It says here Mr. Icahn is not going to go as gently into the night as Mr. Ballmer did–and if I were a betting man, I would be taking odds that your days as Yahoo’s CEO are numbered.

It’ll be better for everyone to have someone in that role who understands who he’s supposed to be working for. Wouldn’t you agree?”

I would–but much more on that diciest of subjects for Yahoo next.