Gordon Brown Wasted Billions

[Tony]

Gold prices were at a high in 1980 when Howe was chancellor

 

You seem unable to understand the simple graph and Howe was Chancellor until 1983. You can't pick dates that suit your daft point.

 

Any price is irrelevant except at the time of a sale. Howe did not sell any gold.

 

Brown sold the UK's gold reserves at a 20 year low. Why did he do that? Why did he ignore the sage advice of everyone around him?

 

Gordon Brown had decided to sell off more than half of the country’s centuries-old gold reserves and the chancellor was intending to announce his plan later that day.

 

It was May 1999 and the gold price had stagnated for much of the decade. The traders present — including senior executives from at least two big investment banks — warned that Brown, who was not at the meeting, could barely have chosen a worse moment.

 

In the room, just behind the governor’s main office, they cautioned that gold traditionally moved in decades-long cycles and that the price was likely to increase. They added that even if the sale were to go ahead, the timings and amounts should not be announced, as the gold price would plunge.

 

“The timing of the decision was ludicrous. We told them you are going to push the gold price down before you sell,” said Peter Fava, then head of precious metal dealing at HSBC who was present at the meeting. “We thought it was a disastrous decision; we couldn’t understand it. We brought up a lot of potential problems at the meeting.”

 

Martin Stokes, former vice-president at JP Morgan, who was also present, said: “I was surprised they had chosen the auction method. It indicated they did not have a real understanding of the gold market.”

 

According to other sources, however, Bank of England officials told those present they had “little say” about what was going to happen and that they were “doing what they were told”. This was a decision made by Brown and his inner circle, who appeared uninterested in their expert advice.

[Wildcat]

You seem unable to understand the simple graph and Howe was Chancellor until 1983. You can't pick dates that suit your daft point.

 

Any price is irrelevant except at the time of a sale. Howe did not sell any gold.

 

Brown sold the UK's gold reserves at a 20 year low. Why did he do that? Why did he ignore the sage advice of everyone around him?

 

Maybe if they expressed it to him in a meeting he was actually in attendance at, had more than a "little to say" and that their criticisms in private went beyond simply the method of selling the gold you might have a point.

 

Maybe you could explain the graph in more detail then? I can see an obvious peak in gold prices during the period Geoffrey Howe was Chancellor when had he sold gold he would have made a killing and might have made enough money to make a real difference to the people that were struggling because of the trashing of the industries Thatcher had brought about through the raising of VAT.

[Tony]

You seem to miss the point that he didn't sell the UK's gold reserves.

 

"he would have made a killing" ? You're advocating that HMG should play fast and loose on the markets with the nations assets. You sound like just the sort of person that would want to sell off the railways or the post office.

[Mecky]

It was only a page ago.

 

See that castle and the little treasure chest? Don't look so surprised, they have been there all along.

 

Link me please

[andikay]

My comparisons are relevant ones that provide context and meaning to what I am saying, yours are not.

 

He lost billions in exactly the same way you can say he wasted billions by not backing a winning horse.

 

Blame can only be attributed with the benefit of hindsight and a good reason to believe he should have been prescient about the collapse of the banking system that caused the long decline in the value of gold to come to an end. Something none of the other political parties predicted. Blaming Gordon Brown is nothing more than demonisation to distract from the real issues and the failure of monetarism.

 

No blame can be attributed he ignored advise.

 

It was May 1999 and the gold price had stagnated for much of the decade. The traders present — including senior executives from at least two big investment banks — warned that Brown, who was not at the meeting, could barely have chosen a worse moment.

 

In the room, just behind the governor’s main office, they cautioned that gold traditionally moved in decades-long cycles and that the price was likely to increase. They added that even if the sale were to go ahead, the timings and amounts should not be announced, as the gold price would plunge.

 

“The timing of the decision was ludicrous. We told them you are going to push the gold price down before you sell,” said Peter Fava, then head of precious metal dealing at HSBC who was present at the meeting. “We thought it was a disastrous decision; we couldn’t understand it. We brought up a lot of potential problems at the meeting.”

 

Martin Stokes, former vice-president at JP Morgan, who was also present, said: “I was surprised they had chosen the auction method. It indicated they did not have a real understanding of the gold market.”

 

According to other sources, however, Bank of England officials told those present they had “little say” about what was going to happen and that they were “doing what they were told”. This was a decision made by Brown and his inner circle, who appeared uninterested in their expert advice.