With the gold price hitting new nominal highs it seems a good moment to remind ourselves about the consequences of Gordon Brown’s sale of much of the country’s gold reserves.
In 1999-2002 he sold 395 metric tons of gold at an average price of $275 an ounce. Today the price stands at $1749 an ounce. No wonder Brown’s sale on the gold price charts is known as "The Brown Bottom". He also gave notice to the market that the sales would take place, thereby giving market participants every opportunity to drive the price down in advance.
Here are the approximate calculations of the value (in millions)which would have accrued if we still held the gold today:
99 - 02
Quantity sold tons
Average price $/oz
Sum realised US$m
Exchange rate avge.
Sum realised £m
The 2012 Olympics are estimated to cost some £9billion, so we could have paid for the Olympics with the amount of value he surrendered and had £2billion left in change. As of December 2010 estimated gold reserves were as follows:-
The impact of the man’s stupidity is breathtaking.