One of the bigger stories in the UK over the past several days, has been the increasing pressure on Prime Minister Gordon Brown to justify his sale of 395 tons of gold in 17 auctions in the period from 1998 through 2002, when Brown was Chancellor of the Exchequer, a role identical to the one Tim Geithner now performs in the US as Treasury Secretary. The issue is that in the abovementioned period, gold was trading at the rock bottom prices of the past two decades, and as such his rush to sell is estimated to have cost UK taxpayers £6 billion. One reason previously given to Parliament, to explain the transactions from Treasury ministers and Tony Blair was that the sale was made 'on the technical advice of the Bank of England.' Today the UK Treasury has released long-withheld FOIA documents which disprove this claim, and indicate that in fact the BOE was if not completely against selling the bullion then certainly waiting until the price improved. Furthermore, as the Daily Mail reports, "A source close to the Bank of England said last night: 'It was not our
decision. It was their decision and we simply provided technical
advice. Then it was up to them.'" Yet, in light of recent LBMA manipulation revelations by GATA, it was most likely the association itself and its member banks which pressed the then relatively new Chancellor to do something against the interest of his people, potentially with promises of further rank extension in the "public services" arena. So far, they have not disappointed.
And while the question of domestic UK politics is quite relevant, we uncover something very important as pertains to our very own US Treasury, its auctions of gold in 1979, the four-fold surge in gold prices in the 1979-1980 period, and the trampling of the London Good Delivery standard by the US Treasury.