This memory just popped into my head, and it seemed interesting enough to share:
In middle school, my friend Billy and I loved the board game Diplomacy. We had just enough friends to put together a game sometimes. He and I were the best players, me because I had a knack for the strategy, and him because he was very good at the diplomatic angle. One day, after everyone sided with him again, I confronted a friend in frustration about why. Surely she knew that I would live up to the letter and spirit of my offer, while Billy would betray her the instant it was to his advantage. She agreed that she knew that both of those things were true, but she trusted him and not me.
That taught me a LOT about human thought.