Rich Guys Club

Is anyone familiar with the name Charles Munger? Better be, for Charles Thomas Munger is the partner and vice-chairman of Warren Buffett’s Berkshire Hathaway Corporation.

Munger, like Buffett, is an Omaha native and earned a JD magna cum laude from Harvard Law School in 1948, and has an excellent track record of his own investment. In a recently published article for Slate titled “Basically, It’s over,” he has unmistakably painted the scenario that the USA faces today.

In the article he talks of “Basicland,” which is his poetic name for the US, starting as a new colony. He describes a romantic setting: “A strong family-oriented culture emphasizing duty to relatives, plus considerable private charity, provided the only social safety net.” In that land the “banking system was simple” and the emphasis was to provide strong currency, efficient trade, and freely available loans to credit-worthy businesses, but to discourage the unworthy borrowers.

Read More: – A Mohit

In the early 1700s, Europeans discovered in the Pacific Ocean a large, unpopulated island with a temperate climate, rich in all nature’s bounty except coal, oil, and natural gas. Reflecting its lack of civilization, they named this island “Basicland.”

The Europeans rapidly repopulated Basicland, creating a new nation. They installed a system of government like that of the early United States. There was much encouragement of trade, and no internal tariff or other impediment to such trade. Property rights were greatly respected and strongly enforced. The banking system was simple. It adapted to a national ethos that sought to provide a sound currency, efficient trade, and ample loans for credit-worthy businesses while strongly discouraging loans to the incompetent or for ordinary daily purchases.

Read More: – By Charles Munger, Slate