He wasn't, though. Not in mid 1941, at least. At that point, Nazi Germany had conquered continental Europe and only had Britain to deal with. Operation Barbarossa was a strategic misstep, but not one born of insanity: there was no indication that the Soviets had the industrial capacity or capability to mobilize and modernize their military so quickly. Moreover, the USSR had vast natural resources reserves (most notably oil) and vast agricultural production, and so they were a legitimate strategic target.

By the start of 1942, the invasion of the USSR had failed and the US had joined the war, and the rest is history.

Hitler doesn't need to be insane to be a terrible person. Why make things worse than they are? Hitler's three critical missteps were aligning with the Japanese in the Tripartite Pact (for which he gained little but gave the US justification to join the war in Europe), pursuing the Battle of Britain (for which he burned a ton of resources and time but ended up not invading because he lacked naval superiority), and invading the Soviet Union (which he did too late in the season and after waiting too long because the Germans spent so much time dicking around Britain).

There's a lot of propaganda surrounding the efficacy of German tanks in WW2 (a good chunk of it coming from "sources" like Death Traps by Cooper). What we do know, though, comes mostly from US reports (because I don't speak Russian). According to a report by the US Army Ballistic Research Lab, the average distance a US tank (M4) would disable a German Panzer 4/5/6 was similar to th average distance that a German Panzer would disable a US tank. The purported advantage that German tanks had in terms of optics and in terms of gun weren't that relevant: Germany's primary advantage was in training over the Soviets and Americans.