Hi, Hollis - fascinating post:)

I think you have clearly described the perfect trainwreck that occurs when expectations are artificially inflated combines with unrealistic confidence.   This is a life problem that has been with us for a long time.  I remember assuming that everyone else was earning more money and managing it much better than I during my first years in the work force.

My expectations were high, my confidence over-inflated, and when the bubble burst, my emotional reaction was to go to the opposite extreme:  I felt a complete failure and did not see how I could ever recover.

Each one of the solutions you describe are right on and effective, if the leader applies them.  My personal favorite, because it is the hardest to do consistently, is number 3, where you evoke Jack Nicholson at his psychotic best.  Reality is usually less appealing than what we see on line and on the screen, but as you point out nicely, it's where we all live.

Even Kim Kardashian has to face reality when the cameras are turned off ...

John