Brown Bottom

As the price of gold today hits a historic 27 year high, Guido wishes he had bought more for his daughters. We all make mistakes as traders don’t we? Gordon Brown’s great mistake is of a different order altogether and is remembered by the gold market players with much fondness and clinking of champagne glasses.

In an act of macro-economic stupidity bordering on treason, he told the market – in advance – that it was his intention to sell off Britain’s gold reserves. When selling a lot of something, and this was 200 years of accumulated gold, it is not thought wise to loudly forewarn buyers in an open market. The market immediately sold off and went short the yellow metal. The dip in prices during what followed is known in the market as the Brown Bottom and was a twenty year low.

Today, the old fashioned solid-state store of value is now 230% higher than when Gordon unloaded the Treasury’s reserves. The fiat dollars he bought with some of the proceeds have halved. The government’s debt (including pension liabilities) has now broken the trillion pound barrier.

Gilt edged government debt is no longer backed by gold under the Bank of England, but by ever rising taxes. Gordon’s reputation in the City is a joke.




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Dominic Raab wrote in his letter of resignation…

“This is, at its heart, a matter of public trust,” he told the PM, concluding: “I cannot reconcile the terms of the proposed deal with the promises we made to the country in our manifesto at the last election… I believe that the regulatory regime proposed for Northern Ireland presents a very real threat to the integrity of the United Kingdom. I cannot support an indefinite backstop arrangement, where the EU holds a veto over our ability to exit…”

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