Thursday, Apr 01, 2010
The sale of Britain's gold
Yahoo / Telegraph: Gordon Brown accused of 'cover-up' over sale of Britain's gold
An email released under freedom of information laws shows that in December 1998 senior officials at the Bank refused to back a Treasury move to sell almost 400 million tons of gold. Hundreds of pages of documents thought to detail the Bank's concerns and advice to the chancellor have been withheld by the Treasury. Gordon Brown was chancellor at the time.
The decision to sell the gold has since been described as one of the worst ever taken by the Treasury, costing the country about £7 billion due to a sharp rise in the price of bullion. The Treasury has declassified only limited information on the sale and refused to release most of the key documents. Some pages have been heavily censored.
Posted by crash n burn @ 11:16 AM (1036 views) Add Comment
11 Comments
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1. Spuglyfuglet said...
"400 million tons of gold" Wow now that would have its own gravity well I think
has April 1st got in a typo
2. greenshootsandleaves said...
An order to sell 400 million tons of the stuff? Just imagine what that would do to the price!
3. doom&gloom said...
c&b. You've misquoted times a million I'm afraid. d&g.
4. waitingtobuy said...
D&G it is april 1st
5. greenshootsandleaves said...
d&g @ 2
Thank God for that! They might even have been tempted to give it all to the people, in which case each person's share would have been around 6.5 tons, most of which would then have gone into property, sending the average price of a 3-bed semi with potential to add a bullion vault to astronomical levels. RIP HPC. Smugdog would have been pleased..
6. quiet guy said...
Here's a theory about the sale:
http://jessescrossroadscafe.blogspot.com/2010/03/browns-bottom-is-enormous-issue-in-uk.html
7. uncle tom said...
It's all a bit mischievous, dragging this old story through the mud just before the election..
..but as Labour has a very long history of playing the same sort of game, they can't really complain...
- Did we need the gold? - Not really..
- Was it a good time to sell? - Hindsight is a wonderful thing, but the market was clearly very slack at the time.
- Was the sale conducted in a prudent manner? - No way, it flooded the market.
- Is Brown guilty? - No crime committed (as far as I know) - but a consequence of his arrogant incompetance.
8. This comment has been removed as it was found to be in breach of our Blog Policies.
9. 51ck-6-51x said...
First off, it was a bad decision, and Brown is a poor leader AFAIC, however I shall defend him...
It was the treasury's gold, they could decide what to do with it, Brown was in charge of the treasury.
The decision did not "cost the country £7bn": The fact that since the price has increased should have no bearing on the correctness of the original decision. If they sold now and did not lose this £7bn who's to say that the value would not be £7bn more in another 11 years. Furthermore the sales (there would need to be many to sell this volume at the best price) would decrease the price, so it wouldn't be the full £7bn anyway.
However, what was probably wrong was:
1) The decision to sell so much of the treasuries gold reserves in the first place;
2) The rush to do so - trading was relatively thin at the time.
3) The decision to air the fact. [totally ridiculous!]
One would think that these three points put the blame firmly on Brown, however he is not at all qualified to make these decisions: He was a history student, a history post-graduate, a tutor, a lecturer, a journalist and finally a politician.
The blame must lie with those who put him in charge and for the system that allows one person to make such a momentous decision on our behalf, surely?
10. greenshootsandleaves said...
What we'd all like to know is 'Who criticised the sale at the time?'
11. letsgetreadytotumble said...
Surely one man cannot have such power?
It was the way it was sold, to drive prices down. There's some shenanigans at work here.
http://www.youtube.com/watch?v=A5v-I8JrPxA
A court has ordered Brown to release all the info on this before the GE under the FOI act.