Acharya Prashant explains that complacency arises from a failure to inquire into the facts of one's life. He notes that most people are not in a healthy internal state, often experiencing dissatisfaction, anxiety, and jealousy. If one remains smug despite these internal realities, it indicates a lack of honesty or a fear of self-inquiry. He emphasizes that physical manifestations of fear, such as trembling before an interview, are undeniable facts that should prompt investigation rather than denial.