Gold's 800(pound) Goodbye to Gordon Brown

By: Adrian Ash | Thu, May 6, 2010
Print Email

As Britain goes to the polls, gold says "Goodbye" in fine style to the man who dumped half the UK's reserves on the market in May 1999...

HOW SWEET of gold to mark Gordon Brown's last day in power with a new all-time high against the Pound Sterling.

He did so much, short term, to dent the former. But his famous "prudence" - in truth, an abject misreading of both economics and history - has in fact worked to destroy the latter instead.

Perhaps today's valedictory jump...leaping 3.7% to touch £805 an ounce...was just one last blow-off to mark Brown's political passing. But the gold price in Sterling looks more ironic than toppish given his legacy of debt.

Gold Price Under Gordon Brown

The man who sold over 55% of the UK's reserves 11 years ago - advising the market two months in advance so it could get itself short...and in fact lending out one-fifth of the UK's total reserves* so gold-sellers could do precisely that, as well - had come to power with gold trading around £200 per ounce.

But rather than leaving gold prices lower...as his ill-advised sales (well, Goldman Sachs-advised, in fact) did at first...the Irn-Bru chancellor has instead given long-term British gold buyers 23% gains for every year of his prudence.

Cheers, Gordon! We might (grow to) miss your smile. Thanks to your fiscal incontinence, however, it should be a few years yet before we miss your impact on gold.

 


 

Adrian Ash

Author: Adrian Ash

Adrian Ash
BullionVault.com

Formerly City correspondent for The Daily Reckoning in London and head of editorial at the UK's leading financial advisory for private investors, Adrian Ash is the head of research at BullionVault, where you can buy gold today vaulted in Zurich on $3 spreads and 0.8% dealing fees.

About BullionVault

BullionVault is the secure, low-cost gold and silver exchange for private investors. It enables you to buy and sell professional-grade bullion at live prices online, storing your physical property in market-accredited, non-bank vaults in London, New York and Zurich.

By February 2011, less than six years after launch, more than 21,000 people from 97 countries used BullionVault, owning well over 21 tonnes of physical gold (US$940m) and 140 tonnes of physical silver (US$129m) as their outright property. There is no minimum investment and users can deal as little as one gram at a time. Each user's unique holding is proven, each day, by the public reconciliation of client property with formal bullion-market bar lists.

BullionVault is a full member of professional trade body the London Bullion Market Association (LBMA). Its innovative online platform was recognized in 2009 by the UK's prestigious Queen's Awards for Enterprise. In June 2010, the gold industry's key market-development body the World Gold Council (www.gold.org) joined with the internet and technology fund Augmentum Capital, which is backed by the London listed Rothschild Investment Trust (RIT Capital Partners), in making an $18.8 million (£12.5m) investment in the business.

For more information, visit http://www.bullionvault.com

© BullionVault 2006-2014

Please Note: This article is to inform your thinking, not lead it. Only you can decide the best place for your money, and any decision you make will put your money at risk. Information or data included here may have already been overtaken by events - and must be verified elsewhere - should you choose to act on it.

</body>
All Images, XHTML Renderings, and Source Code Copyright © Safehaven.com

SEARCH





TRUE MONEY SUPPLY

Source: The Contrarian Take http://blogs.forbes.com/michaelpollaro/
austrian-money-supply/