The Anatomy of Brown’s Gold Bottom – Precious Metals Supply and Demand

Jon Government

The Socialist Politician-Bureaucrat with the Worst Timing Ever
As most in the gold community know, the UK Chancellor of the Exchequer Gordon Brown announced on 7 May, 1999 that HM Treasury planned to sell gold. The dollar began to rise, from about 110mg gold to 120mg on 6 July, the day of the first sale. This translates into dollarish as: gold went down, from $282 to $258. It makes sense, as the UK was selling a lot of gold… or does it?
We won’t get into the theories of his motivation. However, we note that if he wanted to – pardon the dollarish – push down gold, he was not particularly effective. He squandered half of Britain’s gold to get the price to drop 8.5%. That lasted but a few months.
By the end of September, the price was not only back up to $282 but rising rapidly on its way past $320. Then it came down with volatility, rose, slowly fell to just under $260 about two years later. The price bottom just about coincides with the end of his selling.

This post was published at Acting-Man on June 13, 2017.