One of America’s largest online retailers has prepared for a financial crisis. Have you?
During a recent speech (see video below) at the United Precious Metals Association, Overstock.com Chairman Jonathan Johnson said the company has stockpiled $10 million in gold and silver outside of the banking system. He said most of the gold is in the form of “button coins” suitable for payroll:
We want to be able to keep our employees paid, safe, and our site up and running during a time of financial crisis.”
The company also has a plan to ensure employees have access to food in the event of a major economic meltdown. Overstock.com sells freeze dried food. Johnson said the company always maintains inventory on hand to feed every employee plus one other person, such as a spouse, for three months.
Some people may ridicule the company’s preparations as unnecessary, but Johnson is simply responding to history he believes will likely repeat itself. He points out that he predicted the most recent economic meltdown and government policy remains basically unchanged:
We foresaw the financial crisis; we fought against the upcoming financial crisis that happened in 2008, and then it happened. We don’t trust the banks still. We foresee with QE3 and QE4 and QEN, whatever the number is that you can think is big enough – that at some point there is going to be another significant financial crisis.”
If a company with $1.5 billion in revenue has the foresight to prepare for an economic meltdown, shouldn’t individuals?
But why buy gold and silver?
Well, as Johnson pointed out, dollars don’t really have any value, especially during a financial crisis:
Fiat dollars really have no intrinsic value at all…Maybe you could burn a stack of them and keep warm for a little bit, but other than that, their intrinsic value…not backed by gold…is nothing.”
But precious metals historically maintain their value. They can also be used in barter when supplies of cash become short. As Johnson points out, this will likely happen during a financial crisis. When the Greek government limited access to cash, many people turned to barter just to survive. Johnson said that same thing could easily happen here:
