Investment Rarities Incorporated
History |  Q & A  |  Endorsements  |  Portfolios  | Flatware | Gold Coins  |  Silver Coins  |  Contact |  Home

Products

Jim Cook

 

RUNAWAY SOCIAL SYMPATHY

Every once in a while I switch the TV channel from Fox to CNBC to see what the liberals are saying.  After listening awhile I get a deep sense of hopelessness and foreboding for our country.  The most important thing for the left is giving money to people.  They are happy to see the growth of food stamps, disability payments, housing subsidies, free healthcare and all the other welfare benefits.  They utterly fail to see the damage it is doing to the recipients.  Whole cities that once flourished have deteriorated into rotting eyesores populated with shambling hulks of chemically dependent drones.  These people are no longer employable.  They have become incompetent and helpless and the liberals can’t see that it’s their doing.

..Read More »

The Best of Jim Cook Archive

 

Best of William Histed

May 9, 2012

archive print

METALS ARE BOUGHT BECAUSE
OF A LACK OF CIVILIZATION

Charlie Munger, right hand man of multi-billionaire and higher taxes advocate (on others) Warren Buffett is sure to rally the opposition with his recent remark that "civilized people don't buy gold."  He added, they invest in "productive" businesses.
 
Some people buy gold for exactly that reason---that most governments and many people are in fact, NOT civilized.  As a dear friend said the other day,  "We are living in an increasing corrupt environment."
 
And what are the "productive businesses" Mr. Munger and his company invest in?
Berkshire Hathaway has a chunk of change invested in a major carbonated soft drink company.  Products of this company are known to help decay teeth in children, add weight to people who should not be gaining weight and have no known nutritional value.
 
Another "productive business" Berkshire Hathaway owns outright, is a very expensive chocolate and candy company that possesses some of the same characteristics of the first one mentioned.
 
For investing in industries that rot the teeth of children, help cause weight problems with those of all ages, he is a good one to talk about investing in "productive businesses."
                             
"YOU CALL THAT CIVILIZED?"
 
The good Mr. Munger attacks gold while making the assumption that people and governments "are civilized."  Our world today is arguably no more civilized than it has ever been---it is just more sophisticated and polished in its sins.
 
Most governments and political leaders today no longer openly go door to door stealing your possessions---the modern process is done through legislation and a menu of "fees, taxes and inflation."
 
"Civilized" leaders today do not send gangs out to confiscate goods, but they sell favoritism to special interest groups that have purchased influence via "contributions" leading up to election time.  Those on the losing end, end up paying just as truly as if soldiers came rummaging through their property.
 
There is relative little open bribing of politicians in our country where cash is exchanged for favors "under the table."  Our bribery and buying influence is done openly and in a different manner, by giving checks to office holders and candidates simply marked "campaign contribution."
 
Most killing by governments is no longer kings sending soldiers into neighboring countries on horseback to fight eyeball to eyeball with the "enemy," but by using 500 pound bombs dropped from jets and to use unmanned "drones" dropping bombs, often hitting "civilians."
  
Politicians today seldom attack each other physically, but the attacks are character assassinations done by rumor, stretching of the truth, high priced media advertisements and open assaults on the reputation of competitors.
 
Of course, Mr. Munger probably believes all of this "same old wine in a new bottle" is called "modern civilization."
 
The expansion of the government fiat money supplies that is a form of theft, would also be considered "civilized" by some.
 
But perhaps Berkshire Hathaway officials know this as much as anyone, as its many billions of dollars in profits has been made, not in the long term holding of "dollars," but by investing largely in at least the theoretical real assets of stocks.
 
Also, remember not too many years ago, Berkshire Hathaway took a huge position in silver and made a good profit.  Was that "civilized?"

                                 Hypocrisy Abounds Everywhere
 
One of the largest methods by which Berkshire Hathaway rose up was by buying insurance companies.  This of course has often given the company many legal tax benefits.  The insurance industry, by and large, has tax-free and tax-deferred benefits not available to those at large.
 
This, while the chairman, Warren Buffett, has publicly called on higher taxes on the "wealthy."
 
I read recently where the U.S. government says one of Mr. Buffett's aircraft leasing companies owes a tremendous amount of back federal taxes.  Isn't that ironic?
 
Cough it up, Warren!
  
As I wrote in some newspaper columns, Mr. Buffett should just shut up and donate a few billion dollars extra to the politicians to blow if he feels that way about it.  Why doesn't he do that?  Much of his investment lifetime has been spent finding industries that have favorable tax treatment.
 
One final thought.  Who is Mr. Munger to say precious metals are not "productive" businesses?  How many thousands and thousands of jobs in the United States alone are due to mining, mine engineering, jewelry sales, coin hobby dealers, precious metal coins given as gifts and the like?
 
Is this no less of a "productive business" than selling Coca Cola and other soft drinks of which Berkshire Hathaway is a major share owner?
 
How long will it before a precious metals advocate charges Mr. Munger with investing in "sugar water" and "liquid candy?"
 
Is this no less fair than to tell the gold, jewelry and coin hobby industries that they are "unproductive no-accounts?"
 
As a famous wag once noted, "If you want to converse with me, please define the terms you use."