My Buddy The Physicist
As many of you know...I have a friend who is a PhD physicist specializing in failure probabilty analysis. It wasn't until recently that he was admitted into the Institute of Alstrynomics and over the weekend he was elevated to equity partner after he sent me the following email which I will summarize.
He was playing Monopoly with his children and after some period of play ran out of money. AFTER he ran out of money he made the following observation:
...had he had unlimited access to credit, or the "bank"....he would be guaranteed victory every single game....and in relatively short order as he could "buy" up all the properties, quickly put hotels on them and charge whatever he wants after gaining control of the board. He could even give his kids "free passes" as long as they paid him a "tax" the next time they came around. Eventually he could charge them and/or tax them whatever he wanted and would be guaranteed victory everytime.
As part of his elevation to "equity parther" he read the book Atlas Shrugged and was amazed how we are reverse engineering the book....but not in fiction but in reality.
It is why Buffett is no longer Buffett....capitalism implies the fair allocation of credit.....when credit is only offered to a few, and in unlimited quanities, those few get to win everytime, regardless whether they deserve it or not.
The access to credit becomes the determining factor to victory or defeat....no longer is America the land of opportunity....it has become the land where he who has access to credit wins....and he who doesn't loses.
Never before, save a World War, has the Federal Government had so much access to credit while its citizens are being cut off....credit is Freedom.....and the Federal Government's freedom was constrained by the Freedom of its citizens....
but now that the Federal Government's freedom is no longer constrained by the freedom of its citizens...the Federal Government and Wall Street no longer need its citizens.
As a matter of fact, the best interests of the Federal Government and Wall Street now rests overseas....as overseas gets credit and Americans do not. It raises a fundemental Constitutional issue....is our Federal Government looking out for its citizens' and nation's interest...or is the Federal Government now serving Wall Street and the interests of foreign objectives?
All interesting question which can be discussed in a different forum...but what you can learn from the game of Monopoly, and my friend the physicist.....who ever has access to unlimited credit will ALWAYS be able to take the life, liberty, property, and the persuit of happiness of the person who is constrained by limited credit.
Ask yourself the following....since when is bailing out Wall Street and NOT maintreet in the NATIONAL interest?....unless of course you work on Wall Street, and Wall Street owns the banks, the media, and now seemingly most of your politicians.
Remember...Buffett had no problem shutting down Berkshire and reinvesting the money in other places in America....now Buffett is helping to shut down America and reinvest the capital overseas.....
No wonder Buffett is telling you to suck it up.....because you will be forced to suck whatever he wants as he has unlimited access to credit....and you don't.
And wasn't Buffett the guy who was against big inheritances because it was like starting on the 50 yard line in a 100 yard race.........well having unlimited access to credit against limited access to credit is like starting on the 90 yard line in a 91 yard race......the best most often never wins in such a race.
Notice Buffett is making his money on derivatives and foreign investments these days...two things he was against just a few years ago....no more building companies with durable COMPETITIVE advantages....simply a game where he who gets the most amount of easy money wins.
and you lose as the nation continues to get cut off of credit.
As my friend reads this blog....let me extend a warm welcome to our newest equity partner in the the Institute of Alstrynomics.