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Gordon Browns Gold Trade

Tick By Tick's picture





 

 

In the period between Mid 1999 and the End of 2001, Gordon Brown (Chanellor of the Exchequer) managed to sell 12.5 million ounces of gold on the open market to fund wasteful socialist policies around the UK.  The magnitude of this trade cannot be understood until you quantify the potential loss in value.  If we use the July 2011 value from the chart, Gold is priced at $1800 per Troy Ounce or thereabouts.  Using this figure, we can calculate that the British Governtment lost $22 500 000 000 in potential asset value. 

 

 

 

The figures for the chart below were taken from the UK International Reserves and Foreign Currency Liquidity Template issued by the Bank of England.  Any grievances should be taken up directly with The Swerve.

 

Macro Man:

The Swerve / King of the Moon – Governor of a Central Bank based in London

Mervynflation – A form of inflation that a whole population can see and suffers, yet is completely invisible to The Swerve.

 

 

 

 

First published on 28th September 2011

 

 

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Tue, 12/13/2011 - 19:52 | Link to Comment scratch_en_sniff
scratch_en_sniff's picture

um, hes a shitty gold trader, but you must admit, he did not do too bad when it came to trading EUR/GBP.

Tue, 12/13/2011 - 12:19 | Link to Comment FunkyOldGeezer
FunkyOldGeezer's picture

At the time, it WAS the thing to do. No yield, costs involved with storage etc, etc. Gold had been languishing for a fair amount of time and didn't moved significantly for how many years?. Just how much Gold did the UK lose when the pound had to be supported as Soros took everyone to the cleaners?

20/20 vision in hindsight is a marvellous thing.

I'm just saying...

 

 

Tue, 12/13/2011 - 13:03 | Link to Comment Whalley World
Whalley World's picture

I want what you are smokin

Tue, 12/13/2011 - 12:03 | Link to Comment topshelfstuff
topshelfstuff's picture

For anyonw who doesn't know about this link is one of the best I've fond for this story. And it wasn't just about the Sale, though that was bad enough [the bottom], it was the manner, the Telegraphing of the sale before it bgan,thus assuring the Lowest Price possible would appear.

http://jessescrossroadscafe.blogspot.com/2010/03/browns-bottom-is-enormous-issue-in-uk.html

 

24 March 2010

Brown's Bottom Is an Enormous Issue In the UK: Was This a Bailout of the Multinational Bullion Banks Involving the NY Fed?

The bottom referred to, of course, is the bottom of the gold price, and the sale of approximately 400 tonnes of the UK's gold at the bottom of the market.

The sticky issue is not so much the actual sale itself, but the method under which the sale was taken and who benefited.

There has been widespread speculation that the manner in which the sale was conducted and announced was in support of the nascent euro, which Brown favored. This does not seem to hold together however.

There is also a credible speculation that the sale was designed to benefit a few of the London based bullion banks which were heavily short the precious metals, and were looking for a push down in price and a boost in supply to cover their positions and avoid a default. The unlikely names mentioned were AIG, which was trading heavily in precious metals, and the House of Rothschild.
The terms of the bailout was that once their positions were covered, they were to leave the LBMA, the largest physical bullion market in the world.

"LONDON, June 1, 2004 (Reuters) -- AIG International Ltd., part of American International Group Inc., will no longer be a London Bullion Market Association (LBMA) market maker in gold and silver, the LBMA said on Tuesday."

LONDON, April 14, 2004 (Reuters) — NM Rothschild & Sons Ltd., the London-based unit of investment bank Rothschild, will withdraw from trading commodities, including gold, in London as it reviews its operations, it said on Wednesday.

The manner in which the sale was conducted, and the speed at which it was undertaken, without consultation of the Bank of England, made many of the City of London's financiers a bit uneasy. The sale as bailout was given impetus by this revelation which surfaced some years later.

"In front of 3 witnesses, Bank of England Governor Eddie George spoke to Nicholas J. Morrell (CEO of Lonmin Plc) after the Washington Agreement gold price explosion in Sept/Oct 1999. Mr. George said "We looked into the abyss if the gold price rose further. A further rise would have taken down one or several trading houses, which might have taken down all the rest in their wake.
Therefore at any price, at any cost, the central banks had to quell the gold price, manage it. It was very difficult to get the gold price under control but we have now succeeded. The US Fed was very active in getting the gold price down. So was the U.K."

So it appears that long before AIG crafted its enormous positions in CDS with the likes of Goldman Sachs, requiring a bailout by young Tim and the NY Fed, it may have been engaging in short positions in the metals markets, especially silver, and may have required a bailout by England to preserve the integrity of the LBMA.

There are also some who think that the gold sale provided a front-running opportunity for that most rapaciously well-connected of Wall Street Banks, Goldman Sachs. Gold, Goldman, and Gordon

Tue, 12/13/2011 - 11:45 | Link to Comment Ratscam
Ratscam's picture

Switzerland did the same but with over 30 million ounces of gold!

Tue, 12/13/2011 - 11:09 | Link to Comment JDintheUK
JDintheUK's picture

"...senior Bank of England officials refused to support a Treasury proposal to sell almost 400 tonnes of Britain’s gold"

"The Treasury has been officially censured by the Information Commissioner over its attempts to block the release of information about the gold sales... The Treasury has unsuccessfully fought for more than four years to suppress all documents on the gold sales".

Hmmm I wonder why.

More here: 

http://www.telegraph.co.uk/finance/personalfinance/investing/gold/7511589/Explain-why-you-sold-Britains-gold-Gordon-Brown-told.html

http://www.telegraph.co.uk/finance/7542525/Gordon-Brown-accused-of-cover-up-over-gold-sale.html

This was written when gold was $1100.

Tue, 12/13/2011 - 10:49 | Link to Comment paint it red ca...
paint it red call it hell's picture

in my mind, brown's gold liquidation was nothing more than moving the asset from public to private hands.. perhaps the eu benefited in a small way but probably only provided cover as cause. so eu benefits a little, the ultimate puchasers benefited in a big way. at that time no central bank interest existed in gold. so in all likelyhood private hands were the beneficiaries.

Tue, 12/13/2011 - 12:04 | Link to Comment covert
covert's picture

smart choice for a change.

http://expose2.wordpress.com

 

Tue, 12/13/2011 - 10:47 | Link to Comment Bansters-in-my-...
Bansters-in-my- feces's picture

I looked for some substance in this article,but failed to find it.

Did I miss something...?

Disclaimer...I am a gold bug.

Tue, 12/13/2011 - 11:15 | Link to Comment Dr. No
Dr. No's picture

You are gold bug who believes the government should own the gold per your respnse above.  You are a false flag infiltrator.

Tue, 12/13/2011 - 13:07 | Link to Comment Whalley World
Whalley World's picture

One can comment on the stupidity of wasting an empires spoils of war for a few shreds of worthless fiat.  lots of blood went into the capture of that gold and it was sold by a weak and insecure dolt

Tue, 12/13/2011 - 10:38 | Link to Comment rwethereyet
rwethereyet's picture

Who has the most gold in US? Gates, Buffett,Pelosi,Walton's ??

Tue, 12/13/2011 - 11:47 | Link to Comment Ahmeexnal
Ahmeexnal's picture

Goldman Sachs.

Tue, 12/13/2011 - 10:24 | Link to Comment Henry Hub
Henry Hub's picture

A parallel story is the Conservative government of Brian Mulroney selling most of Canada's gold in the 1980s. All 660 tons of it!!

Tue, 12/13/2011 - 10:28 | Link to Comment Potemkin Villag...
Potemkin Village Idiot's picture

Might as well also include a story about "W" topping off the SPR at what were record oil prices at the time...

Tue, 12/13/2011 - 10:17 | Link to Comment Dr. No
Dr. No's picture

I think Gordon Brown did the right thing.  Why should governments and the CB hold the gold??  Sell it the to people as quickly as possible I say.  I only wish the FED and US government took a page from Mr. Brown's book.  From what I sense, Brown bashers think he was stupid because he sold the governement gold and these bashers somehow think they as citizens were douped.  These bashers live in a fantasy world.  Government property is government property and tax payers have no claim.  The faster the gov sells back to the public, the faster power can be returned to the public.

Tue, 12/13/2011 - 10:59 | Link to Comment Bansters-in-my-...
Bansters-in-my- feces's picture

Hey Dr No

Fuck off you sack of goverment shit shill.

Banker or a goverment employee,one or the other.

Fuck off you sack of mouldy shit.

You are not welcome here.

Tue, 12/13/2011 - 11:06 | Link to Comment Dr. No
Dr. No's picture

I promote selling of government property (gold) to the public.  How does that make me a gov shill? seems like it would be the opposite.  I do not believe gold held by gov or CB are good for the public.  The gold was stolen from the public, it should be returned.

Tue, 12/13/2011 - 10:58 | Link to Comment moonstears
moonstears's picture

I see your point good Dr. I think the Brits actually believed THEY the people owned it, but that is a tricky belief, like our own FT Knox in the USA, I believe it's full, unlike many, I just don't know who OWNS it.

Tue, 12/13/2011 - 11:14 | Link to Comment Dr. No
Dr. No's picture

As far as US gold, you are right, I am not sure who owns it: The gov or the FED.  It most certainly is not the people.  Ron Paul proposed selling all the gold to pay the debt.  I back this idea 100%.  Sell gold coins to the public and use the proceeds to fund the fat government projects.  Meanwhile the gold is back where it belongs: in possession by the people.

Tue, 12/13/2011 - 10:13 | Link to Comment Eireann go Brach
Eireann go Brach's picture

Obama will hire Brown to be the next US Treasury Secretary!

Tue, 12/13/2011 - 10:20 | Link to Comment Dr. No
Dr. No's picture

If Mr. Brown promises to sell the US gold as gold coins to the public, I pray for a fast senate confirmation!!

Tue, 12/13/2011 - 10:12 | Link to Comment Outlaw Of The W...
Outlaw Of The Wasteland's picture

he was put in place to dump half of englandistan's gold into the vaults of the jews at the low.  

he is one of the biggest traitors of all time.

Tue, 12/13/2011 - 09:46 | Link to Comment fonzanoon
fonzanoon's picture

Someone please let me know when he is buying so I can get out.

Tue, 12/13/2011 - 09:45 | Link to Comment vegas
vegas's picture

Yea, but he never looked at the gold sales as a "trade". To him, the gold that was sitting there was free money he could use to buy votes. Just like all these asshats in politics, they have no fucking clue about the real world. The gold sale tells me more about him than anything coming out of his lying lips. Selling the family jewels to make interest payments on the credit card. Fucking brilliant.

 

http://vegasxau.blogspot.com

Tue, 12/13/2011 - 09:44 | Link to Comment YHC-FTSE
YHC-FTSE's picture

This is a very old story. Worst gold trader of all time? As a Brit, you won't get an argument from me, nor anyone else around here. 

Tue, 12/13/2011 - 09:04 | Link to Comment Smiddywesson
Smiddywesson's picture

Could recent developments where the UK declined to follow the party line signal that all is not well in bankster land?   Maybe some hard feelings over promises that were extended prior to the Brown sales that are looking like they are no longer going to be honored?

 

Central banksters play tag, covering each other when needed.  Maybe they just got word that the gold you have when this thing blows is all you're ever going to have, and the banksters are never going to return the favor that Brown did them.  

Tag, you're it UK!

Tue, 12/13/2011 - 07:57 | Link to Comment adonisdemilo
adonisdemilo's picture

@ fredquimby

He sold it to his buddies so that they could deliver and cover their shorts.

Tue, 12/13/2011 - 13:17 | Link to Comment Narcolepzzzzzz
Narcolepzzzzzz's picture

Bingo!

This article from 1999 makes for interesting reading. The decision was against BoE wishes but was still pushed through by the Treasury.

(PDF file)

www.venerosoassociates.net/0518%20BOE%20III.pdf

Tue, 12/13/2011 - 07:34 | Link to Comment adonisdemilo
adonisdemilo's picture

It will come to be rcognised, when history is wriiten by someone who is honest, that Gordon Brown was the worst Chancellor and possibly the worst Prime Minister ever. Even worse than Ted Heath.

The only sensible thing that Tony Blair did, whilst in office, was to keep Gordon Brown out of the Premiereship.

Having said that, he allowed him to inflict terminal damage to the UK economy. See latest report on the RBS take over of ABN AMRO which points the gun at Brown, Blair and that other idiot Keynesian theorist (failed)Ed bloody Balls.

Anyway, I was under the impression that Brown sold the GOLD because some of his buddies were caught very, very short, and like the brilliant economist that he thinks, sorry, thought he was/is he announced his intentions thereby ensuring that he got the lowest possible price. The outcome of which enabled his buddies to mitigate their losses at the expense of the Treasury.

Tue, 12/13/2011 - 10:24 | Link to Comment Dr. No
Dr. No's picture

You may be right, but if he sold cuz his buddies were short, the were not in much of a bind considering gold was at a low.  They could have bought on open market and covered with profit.

Tue, 12/13/2011 - 09:39 | Link to Comment onebir
onebir's picture

Brown - being the control freak that he was - kept Blair in the dark about the economy to an extent Blair is probably too embarrassed to admit. Balls (at Brown's behest to find 'room for more spending') was personally responsible inflating UK revenue projections. The Millibands were special advisors at HMT at the time. Not sure exactly what they got up to, but I imagine they were busily creating vote-winning ways to spend Balls' phantom revenues.

King's was unable to countenance the possibility that housing could be in bubble, on grounds that this was inconsistent with the predominant economic theory based on rational agents, and - being the control freak that he is - closed down discussion of the mere possibility that housing could be a risk.  His preferred explanation was a 'regime shift' reflecting reduced macro volatility due to the new inflation targetting regime (ie Merv pats self on back for being clever).

These people are directly responsible for the UK's current economic mess, and not one has been held to account in any signifcant way.

Come the revolution, I hope someone is reading this when they're drawing up the passenger list for the tumbrils. :)

Tue, 12/13/2011 - 11:20 | Link to Comment reload
reload's picture

All excellent points.

My dislike for Ed Balls is reaching epic scale. The Millibands are close behind, their grandfather was however a good man. I expect he would be horrified by their complete lack of sincerity.

But on the issue of Blair - I think he was up to speed on the Gold sales. I think his multi million $ P.A advisory role with JPM is in part a `thank you`. He also does a lot of work for them while being a UN middle east peace envoy. The UK taxpayer picks up the considerable tab for those activities while he lines his own pockets.

The whole lot of them are truly sickening. Brown not in the news much though thank God - I hear he has been in a clinic recieving treatment for depression. Not a condition I would wish on anybody - but he is not on my sympathy list. Disasterous chancellor and disasterous (unelected) PM.

Tue, 12/13/2011 - 11:55 | Link to Comment onebir
onebir's picture

If Blair was up to speed on the gold sales, Brown didn't consider them important. Blair (& the rest of cabinet not directly under Brown's control) were kept completely in the dark until briefings a day or two before the budget.

Brown's depression is probably just a power withdrawal syndrome. Good luck treating that with Prozac, has-been. Really scary thought is Balls as chancellor... 

Tue, 12/13/2011 - 08:26 | Link to Comment MrAngry61
MrAngry61's picture

Apparently Brown insisted on pre-announced auctions against the forceful advice of his officials and the incredulity of metal traders brought in for overview.

 

Brown rejected all of their advice and experience and sold at the bottom that he created - and invested part of the proceeds in Euros apparently...

Tue, 12/13/2011 - 07:01 | Link to Comment fredquimby
fredquimby's picture

If any non-cricket playing people happen to be here ;) .....The Swerve refers to the original "Merv the Swerve Hughes" who was the bane of the English cricket team in late 80's early 90's with his wildly swinging deliveries--- He also had a great tash

P.S To whom did ole GordoB sell the gold too I wonder?

.........His wife apparently.......who was working for Goldman Sachs of course.....

 

Tue, 12/13/2011 - 07:38 | Link to Comment Zero Govt
Zero Govt's picture

i thought Terry Alderman did more damage (took more English wickets) but Merv the Swerve sure had Star appeal (like having the Village People run at you!)

Brown was a crock ..only kept propped-up as a human turdball by being pumped full of anti-depressants and a pitiful pathalogical liar (politicians in a nutshell)

i suppose his suffering wife had to have some pay-off, Goldman Sucks commission for her hubby ripping off and pillaging public assets

Tue, 12/13/2011 - 14:17 | Link to Comment Mediocritas
Mediocritas's picture

Alderman was one of the best damn bowlers of all time IMO. Always overlooked somehow and awarded far fewer LBWs than he should have been. Nobody swung a delivery like he could.

A mate of mine who was a pretty decent (and consistent) fast bowler used to describe Merv's bowling (by comparison) as "shit gets wickets". Put a solid bowler in and the batsmen get focused, disciplined and defensive. Now bring in a guy like Merv who bowls like shit and sprays them around, the batsmens' eyes light up at the thought of smacking some over the fence, they start slashing and inevitably nick one. The shit gets wickets. People remember that and forget about the role a better bowler played in setting the wickets up.

Tue, 12/13/2011 - 19:24 | Link to Comment Zero Govt
Zero Govt's picture

Alderman swung and seemed

agree with the spraying it about theory on Merv, perfect foil to Aldermans accuracy

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