EES: Why preppers have it all wrong

Prepping has not only gone mainstream, it's infected even the billionaire culture as referenced recently on a ZH article:

When it comes to “prepping”, many among the elite take things to an entirely different level.  As you will see below, the elite are willing to pay big money for cutting edge home security measures, luxury bomb shelters and superyacht getaway submarines. Some of the things that the elite are demanding for their own protection go beyond even what we would see in a James Bond film, and serving the prepping needs of the elite has become a multi-billion dollar business.  Meanwhile, the media outlets that the elite own continue to mock the rest of us for getting prepared.  All the time we see headlines like this one that appeared in a major American news source: “Preppers: Meet the paranoid Americans awaiting the apocalypse“.  Well, if we are paranoid for setting aside some extra food and supplies for the future, what does that make the people that you will read about in this article?

Financial prepping has been the mantra of the 'hedge' fund community since it started to exist.  Instead of just blindly buying stocks and hoping the market always goes up, 'hedge funds' provided a 'hedge' in case the market actually didn't go straight up.  Of course, this is now just for lazy investors, now it's possible to buy options for almost any situation, and insurance companies will sell insurance for anything - even being abducted by aliens (over 30,000 policies sold in Europe according to Geico).

Description of the prepper & background

So let's take the average prepper, metaphorically speaking.  You have your safe house, stockpile of supplies, food, ammo, tools, toilet paper, shortwave radios and other electronics powered by cranks, etc. etc. etc. (depending on how deep your infection).

Financially speaking, you keep your savings in a combination of cash (US Dollars, Euros, and Swiss Francs), gold, silver, bitcoin, and bearer bonds.  If you are really savvy, you're holding the paper on several nearby farms in a fair deal whereby they pay down their principle in cash and interest & fees in milk, beef, and in the summer vegetables.

You own several properties in the names of charities you've setup just for this purpose... ok you get the idea.  Take it to the extreme.  The estute prepper has done all this and more - he's ready for anything!

The problem

Now the calamity comes - whether it be a global pandemic, alien invasion, terrorists, the United Nations with foreign troop invasion - take your pick.  It's really bad, but you survive - because you are ready for anything!  So now you've survived - NOW WHAT?  

Do you come out of your bunker after the smoke has cleared?  What will you do all day?  What will other survivors do?  Will you try to communicate with other preppers?  What if in the process of that communication - you discover that you are a little more prepared than they, and they trick you into a meet whereby they kidnap you and force you at gunpoint to give up your safe location and supplies?  

What if there is a secret group of 'anti-preppers' who are right now preparing for ways to steal from preppers, based on their security flaws and lack of planning?  

What if there is a group right now setup by the government, who is monitoring preppers, that within 24 hours of said 'calamity' will be taken into custody (or otherwise dealt with).

What is to stop the military from seizing your supplies, and forcing you to join their chain gang?  

The problem is that in order to really be 'prepared' - one must strive to be a stronger fighting force than the strongest army in the world (be it whatever you think in your opinion) because in a real crisis, the only currencies are 1) intelligence and 2) accelerated lead.  Accelerated lead is a quickly depleting resource whereas intelligence can grow and be self-replicating.  

Prepping generally speaking is a good thing, to use example of global pandemic - if everyone in the world is prepared and follows WHO guidelines, the pandemic will not exist!  Probably the same could be true with financial markets.

The point here is to realize that like with anything - the popularization of 'prepping' has warped the purity of the concept.  

The idea itself - very noble.  But in practicality, in reality, if there is an apocalypse, where are you going to go shopping with your gold and silver coins?  

Especially in America where we like to do things to extremes (like eating for example) - we've taken prepping to a new fangled art form.  But it's this 'new level' that is the snake oil - not the concept of prepping.

Just in case

Mossberg sells a package "Just in Case" that includes survival kit, shotgun, all neatly packaged in a waterproof tube (that also can double as a flotation device).  It's a great analogy for the prepping movement.  It's a great thing to have - JUST IN CASE.  99% of buyers of this will never use it.  

But - IT'S BETTER TO HAVE IT AND NOT NEED IT, THAN TO NEED IT AND NOT HAVE IT!  -The Avid Prepper

Financial Prepping

What can one do to financial prepare themselves?  This completely depends on the situation, and depends on the extent you want to prepare for.  As a general rule, you just want to be more prepared than your neighbor, but only a little.  That means - forget about the kevlar suit that can withstand 1,000F burns, or the bitcoin wallet that can only be opened with one time pad; each hidden in 2 secure locations in Europe.

Also, forget this naive idea about hoarding physical gold or cash - as if it will help you.  You're just painting a target on your back!  Where will you spend this cash?

Some reasonable prepping steps to be a 'pure prepper' 

• Have a healthy options portfolio
• Take the other side (even if you don't agree with it)
• Invest in some really crazy ideas - if everyone you know says 'don't do it - it's crazy' - DO IT!
• Invest and trade LOCALLY, at least a little.
• Keep multiple accounts open with different TYPES of brokerage firms/banks - not only the same institution where your 401k is.  Not all of them will die.
• Participate in some class action lawsuits for securities or similar cases - even if you won't get a big payout.  When the dollar bubble really pops, you'll have a friend who can help you get 20 cents on the dollar from Bank of America.
• Make some foreign connections, who may not be in the same predicament as most in America
• As much as possible, try to do things for yourself.  Having your deck resurfaced?  Do it yourself!  Do your own research - don't rely on a service (and certainly not your broker!)  
• Educate yourself!  Learn a foreign language, or study that course in wreath making you've been putting off for so long.  Remember, although the world is a large place - the majority of nuclear fuel rods are made by hand by Samurais in Japan:

Although Japan Steel Works is a major corporation with 5,000 employees, it also maintains a samurai sword blacksmith, in a small shack on a hill above the factory in Muroran, where a single craftsman still hammers steel into broadswords, as the company has done since 1917.

Just remember.  For those who think the apocalypse is coming - there are just as many who believe it's already here.  Just ask some Detroit residents.  

Looks like the Zombies have already invaded and destroyed our cities.  

 http://www.zerohedge.com/news/2015-11-12/why-preppers-have-it-all-wrong

Banks’ Civil Forex Settlements Near $2 Billion

The total amount paid by banks to settle a civil lawsuit tied to allegations traders manipulated the currency market has now reached almost $2 billion following a recent round of settlement agreements.

HSBC Holdings PLC, Barclays PLC, BNP Paribas SA and Goldman Sachs Group Inc. have recently signed agreements to settle the case, according to people familiar with the matter.

HSBC agreed to pay $285 million and Barclays $375 million, some of the people said. The Wall Street Journal previously reported that Goldman Sachs Group was in advanced settlement discussions for $129.5 million. It was unclear how much BNP has agreed to pay.

The four banks are among a dozen lenders named as defendants in the suit filed in late 2013 by law firms Scott+Scott LLP and Hausfeld LLP on behalf of a group of claimants including several U.S. state pension funds, which alleged bank traders improperly shared confidential information about their clients’ orders through electronic chat rooms to unfairly manipulate the $5.3 trillion currency market.

Five other banks reached settlements with the claimants earlier this year totaling roughly $1 billion, according to public statements from the banks and law firms involved in the case.

The civil settlements follow $10 billion in bank fines after a yearslong investigation into the foreign-exchange market by many global regulators including the U.S. Department of Justice and the U.K.’s Financial Conduct Authority. While regulatory settlements in the U.K. last November and in the U.S. in May largely closed the book on the official investigation, problems related to the currency market continue to rumble on. Banks are likely to face similar civil claims in other jurisdictions such as London, where both plaintiff firms have an office, according to a person familiar with the matter.

Plaintiffs accused the banks’ traders of conspiring in instant messages and chat rooms with names such as “the Cartel,” and “the Dream Team” to manipulate foreign-exchange markets. “[Banks] participated in an unlawful conspiracy to restrain trade,” the filing said.

Three of the banks—Deutsche Bank AG, Credit Suisse AG, and Morgan Stanley—have still not agreed a civil settlement, according to people familiar with the matter.

None of the banks that have settled the suit have admitted to any wrongdoing, according to settlement agreements seen by the Journal.

The civil suit is pending in New York. U.S. district court judge Lorna G. Schofield is due to talk with lawyers and some of the defendants on Thursday, according to court filings.

A person familiar with the civil case said negotiations with other banks accelerated after J.P. Morgan Chase & Co. in January became the first bank to agree to a settlement. The U.S. bank agreed to pay out $99.5 million and disclose to the plaintiffs’ lawyers documentation it had already shared with U.S. and European regulators and trading data related to the alleged manipulation, according to documents reviewed by the Journal.

The agreements signed by other banks include similar clauses, according to people familiar with the matter.

http://www.wsj.com/articles/banks-civil-forex-settlements-near-2-billion-1434541324

OPEN A FOREX ACCOUNT

Venezuela Default Countdown Begins: After Selling Billions In Gold, Caracas Raids $467 Million In IMF Reserves

In late October, when describing Venezuela's desperate steps to keep itself afloat for a few more months, we reported that in order to fund $3.5 billion bond payments in early November, Maduro's government had engaged in something that is the very definition of insanity: selling the country's sovereign (and pateiently repatriated by his deceased predecessor) gold to repay creditors.

Specifically, in the past several months, Caracas has quietly parted with 19% of its gold holdings: "Central bank financial statements posted this week on its website show monetary gold totaled 91.41 billion bolivars in January and 74.14 billion bolivars in May.  At the strongest official exchange rate of 6.3 bolivars per U.S. dollar, which the bank uses for its financial statements, that decline would be equivalent to $2.74 billion."

But while ridiculous, Venezuela's decision to liquidate some of its gold is perhaps understandable under the circumstances: Venezulea relies on crude oil for 95% of its export revenue, and with prices refusing to rebound, the only question is when do all those CDS which price in a Venezuela default finally get paid.

What is even more understandable is what Venezuela should have done in the first place before dumping a fifth of its gold, but got to do eventually, namely raiding all of the IMF capital held under its name in a special SDR reserve account.

Recall that this is precisely what Greece did in July when everyone was speculating when it would default. Now its Venezuela's turn.

The details: Reuters reports that Venezuela withdrew some $467 million from an IMF holding account in October, according to information posted on the fund's web-site, as the OPEC nation seeks to improve the liquidity of its reserves amid low oil prices and a severe recession.

Venezuela holds part of its reserves with the International Monetary Fund in an instrument called Special Drawing Rights (SDR), a basket of international currencies made up of the euro, Japanese yen, pound sterling and U.S. dollar.

The withdrawal will allow Venezuela to use the funds for imports or debt service, but does not change its total reserve holdings as SDRs are already accounted for.

Needless to say, it is far wiser to use up all paper "assets" to repay "paper" liabilities, before resorting to hart money. By then, it is usually game over anyway, so our advise to Mr. Maduro: just default now, and save your gold.

Referentially, the country's international reserves as of Thursday stood at $14.819 billion: and dropping fast.  At this rate of depletion, we give Venezuela a few more months before the army takes over.

Finally, the central bank's most recent financial statements as of May, showed that 58% of reserves were held in gold.  It is unclear how much, if any, were held in "toilet paper".

http://www.zerohedge.com/news/2015-11-09/venezuela-default-countdown-begins-after-selling-billions-gold-caracas-raids-467-mil

This post sponsored by Elite E Services Forex

Shares Of World's Largest Miner Plunge To Seven-Year Low After Massive Toxic Mudslide Engulfs Brazilian Village

Ok, so if you’re the world’s largest mining company, one thing you don’t want is a global deflationary supply glut brought on by depressed demand from China and a worldwide excess capacity problem. 

Another thing you don’t want is for a tailings dam to burst, sending a river of toxic mud into a nearby village in South America.

Well, BHP Billiton is now dealing with both of those issues and the market is punishing the stock, which hit a seven-year low on Monday as analysts and investors alike attempt to figure out how the company intends to clean up a spectacular (in a bad way) mess in Minas Gerais. 

Here’s what happened, in BHP’s words: 

The Samarco operations include a three tiered tailings dam complex. Within this complex, the Fundão dam failed and the downstream Santarém dam has been affected. This resulted in a significant release of mine tailings, flooding the community of Bento Rodrigues and impacting other communities downstream.The third dam in the complex, the Germano dam, is being monitored by Samarco. At this time, there is no confirmation of the causes of the tailings release.

Samarco is jointly operated with Brazilian giant Vale and BHP has been keen to note that the joint venture is “responsible for the entirety” of the Minas Gerais operations. After the company's operating license was revoked on Monday, its debt plunged, with some $2.2 billion in paper due 2022, 2023, and 2024 hitting record lows.

For those who might have missed it, the following images will tell you pretty much all you need to know about what happened:

(via WSJ)

And here's Deutsche Bank's take, which underscores the significance:

BHP and Vale's 30Mtpa Samarco iron ore mine in Southern Brazil (50/50 JV) has suffered a catastrophic tailings dam failure. The mine represents c. 10% of our BHP earnings and 3% of NPV, we now assume the mine is shut until FY19. Pellet production was recently expanded to 30Mtpa at a cost of US$3.2b. Media reports have stated that there is a significant and tragic loss of life. Based on public images of the failure we estimate that the dam contained over 300Mt or 150Mm3 of tailings and Samarco could be down for years while the clean-up costs may exceed US$1b. This accident will add further pressure to BHP's cash flow, growth and safeguarding of the progressive dividend

At around 0530am AEST on Nov 6, Samarco’s largest tailings facility failed causing slurry to race through the open pit and down the valley into the local village of Bento Rodrigues and into local waterways. The media is reporting that between 15 and 17 people have died and 45 others are missing. Samarco states in its FY14 sustainability report that it employs a management system referred to as “Failure Modes and Effects Analysis (FMEA) system” to control tailings dam failure risks. It could be months before Vale, BHP, State and Federal governments complete their assessment of the incident. The clean-up, community support, litigation and rebuilding of the tailings dam (if approved and deemed feasible) could mean that Samarco is shut for years. The mine employs 3,100 people and is one of the largest employers in the region. Samarco contributed US$369m to BHP earnings in FY15 and before this incident we estimated it would contribute US$308m in FY16. We have assumed the mine is shut until FY19, the workforce remains employed, and BHP’s share of the clean-up and dam rebuild costs US$500m. We have excluded any recouping of costs from insurance at this stage. 

Of course this is the sellside penguin brigade so naturally, all of that somehow translates to a "Hold":

As WSJ notes: 

Brazilian officials on Sunday raised the death toll to three people, two of whom were found in the path of the mud flow, and a third who died while receiving medical treatment. That number is expected to rise, as at least 28 people are now confirmed missing.

“BHP Billiton will continue to work with Samarco, Vale, the local communities, local authorities, regulators and insurers to assess the full impact of this tragic incident,” BHP said.

The shutdown will reduce BHP’s iron-ore production this fiscal year—cutting into profit when falling commodity prices already are already making it more difficult for the company to keep its promise to maintain or lift shareholder dividends. Samarco last year accounted for roughly 3% of BHP’s underlying earnings.

Right, so in other words, this is an unmitigated disaster. 

On the "bright" side, the fallout could take some excess supply offline, and could impact prices. Here's more, via Bloomberg:

• Deactivation of production at Samarco Mineracao mine, a JV between BHP Billiton and Vale, is likely to pressure iron-ore prices, Christopher Tuck, mineral commodity specialist at U.S. Geological Survey’s National Minerals Information Center, says in interview in Rio.
  • "Any deactivation, on this scale, will have an impact on seaborne trade. The varying factor that would affect prices is the length of time this mine remains inoperable. The larger time it remains idled, the greater the likelihood it will have an impact on prices’’
  • Potential impact on price of pellets much more significant than effect on overall market
  • Short-term idling could level off prices through end of 2015; if output is halted long-term, prices could increase slightly

We suppose the takeaway here is that an already abysmal backdrop for BHP just got a lot worse, which means you may want to brace yourself if you're a shareholder and if you're a Brazilian villager, just hold your breath and wait for your compensatory check from Samarco - we're sure it's in the mail.

http://www.zerohedge.com/news/2015-11-09/shares-worlds-largest-miner-plunge-seven-year-low-after-massive-toxic-mudslide-engul

The Most Surprising Thing About Today's Jobs Report

After several months of weak and deteriorating payrolls prints, perhaps the biggest tell today's job number would surprise massively to the upside came yesterday from Goldman, which as we noted earlier, just yesterday hiked its forecast from 175K to 190K. And while as Brown Brothers said after the reported that it is "difficult to find the cloud in the silver lining" one clear cloud emerges when looking just a little deeper below the surface.

That cloud emerges when looking at the age breakdown of the October job gains as released by the BLS' Household Survey. What it shows is that while total jobs soared, that was certainly not the case in the most important for wage growth purposes age group, those aged 25-54.

As the chart below shows, in October the age group that accounted for virtually all total job gains was workers aged 55 and over. They added some 378K jobs in the past month, representing virtually the entire increase in payrolls. And more troubling: workers aged 25-54 actually declined by 35,000, with males in this age group tumbling by 119,000!

Little wonder then why there is no wage growth as employers continue hiring mostly those toward the twilight of their careers: the workers who have little leverage to demand wage hikes now and in the future, something employers are well aware of.

The next chart shows the break down the cumulative job gains since December 2007 and while workers aged 55 and older have gained over 7.5 million jobs in the past 8 years, workers aged 55 and under, have lost a cumulative total of 4.6 million jobs.

The same chart as above showing the full breakdown by age group - once again the 25-54 age group sticks out.

But young workers' loss is old workers' gain, as the following chart of total jobs held by those aged 55 and over shows. As of October, there was a record 33.8 million workers in the oldest age group tracked by the BLS - the same workers who, as noted above, also have the poorest wage negotiating leverage.

Finally, the most disappointing data point in today's report is that while overall labor growth was solid, the participation rate for workers 25-54, was 80.7%, far below is peak of just under 85%, and below the 80.8% at the end of 2014.

Time for a rate hike?

http://www.zerohedge.com/news/2015-11-06/most-surprising-thing-about-todays-jobs-report

EES: Play The Forex Fix - JPY And CHF Pairs Range Bound

The Forex market is very unusual; it's the largest market in the world with the least amount of significant players (a handful of large banks and central banks control the Forex market).

We see everyday in the news more and more proof that the Forex market, to a large degree, is fixed. Just today, two traders from Rabobank have been convicted of rigging Libor rates:

Two British citizens face lengthy prison sentences in the US after being convicted of rigging Libor interest rates, in the first case of its kind to reach a courtroom across the Atlantic.  The two former traders at the Dutch bank Rabobank - Anthony Allen, Rabobank's former global head of liquidity and finance, and Anthony Conti, a former senior trader - both intend to appeal against the verdicts reached by a federal jury in Manhattan.

The US justice department said the verdicts showed that the authorities were determined to crack down on financial crime.

Instead of getting into the detail of how and why the Forex market is different, and that it's fixed; let's look at some charts of USDJPY and EURCHF.

USDJPY 1 Hour

EURCHF 1 Hour

As you can see from the above 2 pairs which are not connected or correlated, there are defined ranges and little direction. While USDJPY has a slight trend up and EURCHF has a slight trend down, they mostly are range bound.

Why is this? Both the BOJ and the SNB have intervened in the market to influence the Forex market, and in some cases have defined predetermined 'fix' levels where they want the currencies to be. They can do that, because they are the primary emission of the currency!

A simple range bound strategy - trade the ranges

If you have the ability to trade spot Forex, trading these ranges is simple. In the case of USDJPY, simply sell when there's a big move up and buy when there's a big move down. There are ways to use algorithms to execute this as well - simply program them to trade against the market - if USDJPY is going up - sell, and if USDJPY is going down, buy.

Of course, there are situations where they will break out of the range - which is why it is always prudent to use stop losses and other account protection methods. The ranges certainly will not last forever - but the point is to make money while they last!

Trading ranges with options

If available at your broker, trading these ranges with options is great, especially with options such as 'double no touch' which allows traders to bet that a pair will stay within a certain range.

For serious traders, sell a call above the range and sell a put below the range for the duration you believe the range will last (30 days, a reasonable time). Or in the reverse and in the money, buy a put above the range and buy a call below the range.

What this bet is really all about - the Forex Fix

Not only do the banks fix Forex market rates, the central banks openly manipulate the Forex market in many ways:

• Most basically, setting the interest rates
• Capital controls (such as the case with emerging markets)
• Actual Forex market intervention

See a short timeline of central bank intervention from Reuters here.

What are the best range bound Forex pairs?

Simply open your platform and look hourly or daily charts. Currently any CHF pair should be the best, and the best CHF pair - EURCHF. Any pair which is connected to a central bank that openly intervenes in the market, is subject to such behavior. JPY is a little more volatile than CHF, as Japan has a real economy it needs to manage (no offense, Switzerland!).

Remember - Forex is a countertrend market. It always pays in Forex to bet against the trend. Forget "The trend is your friend" and start listening to "Home, home on the range."

About Elite E Services Forex

For updated Forex strategies, checkout Elite E Services blog, Elite Forex Blog.  

http://www.zerohedge.com/news/2015-11-05/play-forex-fix-jpy-and-chf-pairs-range-bound

Bank Of Ireland Bans "Small" Cash Withdrawals At Branches

As central planners the world over grapple with the effective “lower bound” that’s imposed by the existence of physical banknotes, there’s been no shortage of calls for a ban on cash. 

Put simply, if you eliminate physical currency, you also eliminate the idea of a floor for depo rates.

After all, if people can’t withdraw paper money and stash it under the mattress, then interest rates can be as negative as the government wants them to be in order to “encourage” consumption. If, for instance, you’re being charged 10% for saving your money, then by God you will probably spend that money rather than see the bank collect a double-digit fee just for holding on to your paycheck. 

In the absence of physical cash, there’s no way for depositors to avoid that rather unpalatable outcome unless the public starts buying hard assets like commodities with their debit cards. If you think that sounds far-fetched, just consider the fact that everyone from Citi’s Willem Buiter to economist Ken Rogoff to the German Council Of Economic Experts' Peter Bofinger have now floated the idea. 

"With today's technical possibilities, coins and notes are in fact an anachronism," Bofinger told Spiegel back in May. 

Now, in what should be a wake up call to the world, Bank of Ireland has banned branch withdrawals of less than €700. 

Seriously.

Here's The Irish Times explaining that tellers will still assist the "elderly" if they have trouble using automated methods of obtaining cash:

Under new rules, designed to streamline in-branch services, Bank of Ireland said withdrawals of less than €700 will no longer be facilitated with the assistance of tellers.

From mid-November, customers will have to use ATMs or mobile devices for small and modest-sized withdrawals.

Lodgements of up to €3,000 and those involving less than 15 cheques will also have to use the bank’s dedicated lodgement ATMs.

“Bank of Ireland understands these changes may be a new way of banking for some of our customers, and the branch teams will be available to help and guide them through this change,” the bank said in a statement.

So, if you are, i) wanting less than €700, ii) have less than 15 checks to deposit, or iii) aren't looking to put at least €3,000 into your account, you are no longer welcome inside Bank of Ireland branches. 

For his part, Irish Finance Minister Michael Noonan seems to think that this is, for lack of a better description, absolutely nuts: 

Minister for Finance Michael Noonan has described restrictions to be imposed by Bank of Ireland on over-the-counter lodgements and withdrawals as both “surprising and unnecessary”.

“I expect the bank to fully honour this commitment and ensure that customers will be facilitated through the existing arrangements where required. I would welcome a clarification form Bank of Ireland on the issue,” he said in a statement.

Yes, Noonan is demanding some "clarification," and you should too, before you discover that the world's central bankers planners have absconded with your physical cash on the way to instituting a regime that will allow for the micromanagement of your purchasing decisions. 

http://www.zerohedge.com/news/2015-11-05/bank-ireland-bans-small-cash-withdrawals-branches

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How One Retailer Is Preparing For The Apocalypse

Zero Hedge first revealed Overstock's contingency plans "in preparation for the next collapse" ten days ago. Today, the strategy outlined by Overstock Chairman Jonathan Johnson hasresonated across the Atlantic and this morning as the Financial Times catches up to the story of an "online retailer hoarding gold as crisis defense" in which it calls the retailer a "redoubt of doomsday conservatism" adding its policy to prepare for the loss of central-planning control is "redolent of the small band of US survivalists preparing for the end of civilization."

The FT reports that Jonathan Johnson, Overstock’s "anti-establishment leader", told the Financial Times it has "stashed away $10m in gold and silver coins as an insurance policy against financial apocalypse" and that it keeps "precious metals outside the banking system so the company could pay employees even if lenders slammed shut in a crisis."

Mr Johnson, who is running to be Utah governor, said Overstock also kept extra freeze-dried food so it had enough to feed each employee and one family member for three months.

“We thought there’s a decent chance that there could be a banking holiday at some point caused by a crisis and it could last for two days or two weeks or who knows how long, and we wanted to be in a position where we could continue to operate during any such crisis,” he said.

Overstock’s gold stash will resonate with libertarian conservatives who distrust the Federal Reserve and Wall Street and view gold as a refuge from government attempts to inflate and control the economy.

According to the FT, Overstock's stockpile "makes up about 10 per cent of the company’s liquid assets."

The Nikkei's most recent media acquisition also notes that in an "act of rebellion against financial convention", Patrick Byrne, its chief executive, "is a strident libertarian who champions bitcoin, the virtual currency, and its immunity from government money-printing."

Well, if the company had converted all of its fiat currency in bitcoin two months ago, it would have doubled in value as of yesterday now that the predicted Chinese exodus into the digital currency has been unleashed.

Mr Johnson said Overstock’s board had approved its accumulation of gold and silver after the last financial crisis when the Fed’s policy of quantitative easing, which he called dangerously “irresponsible”, was in full swing.

So with the Fed jawboning for a rate hike, and ZIRP expected to end in 6 weeks (the way it "ended" in Japan in August 2000), has Overstock's gloomy outlook changed? Not at all: "On the bullion hoarding policy, he said: “It was put in place during quantitative easing. It’s in place now and we don’t see a reason to change it.”

“Gold is just one of the financial contingency plans that Overstock puts in place,” he said. “We also have contingencies if sales don’t come in as expected.”

The FT concludes by poking fun of preppers and those who think the world's biggest experiment in central planning intervention will end the way central planning interventions always have - in absolute disaster:  

"Overstock’s policy is redolent of the small band of US survivalists preparing for the end of civilization, but Mr Johnson said he himself was not a “prepper”.

We'll spare judgment on Overstock's policy and Johnson's "prepperness" since the final chapter of the financial crisis - namely the so-called unwind of emergency measures - has yet to be written.

* * *

Finally for those who missed it and who would rather make up their own mind about the strategy, here are the key highlights from Johnson's speech presented first here in late October:

We are not big fans of Wall Street and we don't trust them. We foresaw the financial crisis, we fought against the financial crisis that happened in 2008; we don't trust the banks still and we foresee that with QE3, and QE4 and QE n that at some point there is going to be another significant financial crisis.

So what do we do as a business so that we would be prepared when that happens. One thing that we do that is fairly unique: we have about $10 million in gold, mostly the small button-sized coins, that we keep outside of the banking system. We expect that when there is a financial crisis there will be a banking holiday. I don't know if it will be 2 days, or 2 weeks, or 2 months. We have $10 million in gold and silver in denominations small enough that we can use for payroll. We want to be able to keep our employees paid, safe and our site up and running during a financial crisis.

We also happen to have three months of food supply for every employee that we can live on.

His full presentation before the UPMA is below:

http://www.zerohedge.com/news/2015-11-05/how-one-retailer-preparing-apocalypse