This is a fundamental problem with PoS, and is why Peercoin incorporates both PoW and centralized checkpointing. Sunny King is not a stupid guy, he knows that PoS has a big flaw or else he would have implemented pure PoS for Peercoin
I've heard this argument quoted many times.
I don't agree with the idea that there's a "fundamental problem" with POS. I think there are more fundamental problems with POW.
I also think that POS is a far more elegant and modern approach to crypto currencies, being that it more closely represents the idea of "tokenised" wealth than POW does. POW kind of panders to the false premise that a store of wealth has to have "done something to deserve its value". In fact it doesn't and that's a highly flawed analysis of the definition of money in itself.
The fact that you can potentially take control of it by owning more than half the money supply doesn't impress me either as a criticism. In the modern world, you can take control of just about anything by owning more than half of it and as I said before, these are hypothetical scenarios anyway, not practical ones.
So all in all, I see POW as being obsolete. I'm into DRK for other reasons - I don't mind the fact that it's POW - I don't have any problem with that. Bitcoin itself is a POW algo, but if we're comparing "investability" issues based on algo alone, give me POS any day.
I'm not saying it's a problem with PoS as an idea, in general; but it is a problem with PoS as currently implemented by Peercoin and all of its copycats (pretty much any copycoin with a QT interface and not too much original development). The PoS mechanism in NXT may be better (I have not seen any real details of it), and maybe somebody else has a solution implemented somewhere that I have not read about. I know that Daniel Larimer (who is a very smart guy) who is developing BitShares, had problems creating a PoS system from scratch. He kept running into all of these issues, came up with a system called "TaPoS" (Transaction as Proof of Stake) and ended up morphing into a PoS system called DPoS that implements a Delegate system with some similarities to the MasterNodes of Darkcoin. We will see how that system turns out. But all Peercoin-derived PoS implementations are flawed in several ways, this being a major one.