The Economist notes that if Geoffrey Howe had sold 12.7 million ounces of gold at the 1980 peak price of $850 he would have received almost $11 billion. Invested in Treasury Bonds this would have yielded 7% a year, so the tax payer would be around $90 billion up on the transaction.
Come on Gordon (or your puppet), retrieve your disaster in selling gold at $276 an ounce (all 12.7m of them), and cover your Northern Rock disaster too.
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4 comments:
So it was Howe's error, not Gordon's...
Gordon sold in, indeed created and owns, Brown's Bottom. Howe, (the Economist again), would have had to have acted on a blip - very hard as all would agree.
This gold price is not a blip; after all, ND and CityU accurately forecast it months ago.
Presumably Gordon didn't sell off ALL the gold (did he?), just enough to play his part. There must be more; so sell it now and get it working. Undo some of the damage.
Howe missed a beat as a commodity trader (and even Keynes, the ultimate gambler, is reported to have been seen staring at the Chapel and when asked was there something amiss, replied No, there's just all this grain the College has bought), but caution with the country's gold reserves is not unreasonable.
Silly behaviour in its disposal is. Gordon had better get it right with what's left.
Brown sold 415 of 715 tonnes, I understand. But the Swiss got rid of lots, too:
http://www.marketoracle.co.uk/Article772.html
But from what I recall, the Swiss were far more circumspect about selling theirs? Not pre-announcing it, and selling in small lots, rather than Prudence's fire sale.
He does look very sick to me, Brown. I'll say no more.
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