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Deceit, secrecy surround British gold sales as records are pried loose
8:11p ET Wednesday, March 31, 2010
Dear Friend of GATA and Gold:
Today's story from the Daily Mail in London, appended, shows what a pinch the British government and other gold market-rigging governments are in. They are forced to conceal information and cannot explain why their selling gold at lousy prices was actually a great success of policy -- a matter of sustaining the value of their own currencies and government bonds. Let those who deny the gold price suppression scheme explain the terrified secrecy around Western central bank gold reserves. Indeed, let them put to a central bank even one critical question about gold and then wonder aloud when they don't get an answer. Until they do, they can be presumed to be intellectually dishonest.
CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.
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Brown Defied Bank of England Warning Over His L6 Billion Gold Giveaway
By Jason Groves
Daily Mail, London
Wednesday, March 31, 2010
http://www.dailymail.co.uk/news/article-1262683/Brown-defied-Bank-warnin...
Gordon Brown rode roughshod over resistance from the Bank of England to order the disastrous selloff of Britain's gold reserves, secret papers have revealed.
Treasury documents released under freedom of information last night suggest that the Bank was reluctant to sign up to the sale of 395 tonnes of gold at rock-bottom prices in a series of auctions between 1999 and 2002.
... Dispatch continues below ...
Preliminary Feasibility Study Completed for Seabridge Gold's KSM Project
Study Reports Reserves of 30.2 Million Oz. Gold, 7 Billion Lbs. Copper,
133 Million Oz Silver, 210 Million Lbs. Molybdenum
Base Case Life of Mine Cash Operating Costs Estimated at $144/oz. Gold Produced
(Net of Base Metal Credits)
Toronto -- Seabridge Gold Inc. has announced results from a National Instrument 43-101 compliant preliminary feasibility study of its 100-percent owned KSM project in northern British Columbia, Canada. The study was prepared by Wardrop, a Tetra Tech company, a major international engineering and consulting firm.
Seabridge President and CEO Rudi Fronk says, "The study confirms that the KSM project now hosts the largest gold reserve in Canada and one of the largest in the world. KSM is projected to provide an extraordinary mine life of more than 35 years with estimated cash operating costs well below the current average of the major gold producers. Estimated capital costs are in line with those of comparable, large-scale, undeveloped gold-copper projects and KSM has the advantage of being located in a low-risk jurisdiction."
For the complete Seabridge Gold statement:
http://www.seabridgegold.net/readmore.php?newsid=283
The deals, struck when Mr Brown was Chancellor, are thought to have cost Britain L6 billion, almost double the L3.3 billion cost of Black Wednesday in 1992, when the country crashed out of the European Exchange Rate Mechanism.
Senior officials are said to have warned that the timing of the sale risked losing money for the taxpayer.
Treasury ministers and Tony Blair previously told Parliament that the sale was made "on the technical advice of the Bank of England."
One crucial passage in the papers about relations between the Treasury and the Bank has been blacked out.
Liberal Democrat Treasury spokesman Vince Cable said: "It has long been clear that Gordon Brown's gold selloff was spectacularly bad timing, but these papers show the extent of the opposition from those who saw how much money his actions could lose the country. It is clear that the taxpayer is now footing the bill for the prime minister's refusal to listen to reason."
The sale took place during a slump in world gold prices which drove its value to record lows. At the time City analysts warned Mr Brown against the sale.
The Treasury achieved an average price of just $275.60 an ounce. The price of gold has since quadrupled to $1,114 an ounce.
The documents show that Mr Brown made repeated efforts to persuade the Bank to agree a 'joint proposal' on the gold selloff.
The Treasury made at least four separate attempts between August and December 2008 to persuade the Bank to sign up to the sale.
It is made clear that the Bank offered advice to Mr Brown in September 1998 but it was rejected. The bank is thought to have told Mr Brown to delay at least part of the sale until the price improved.
A source close to the Bank of England said last night: "It was not our decision. It was their decision and we simply provided technical advice. Then it was up to them."
Two days before Christmas 1998 -- just a month before the sale was announced -- a senior Treasury official wrote to the department's then permanent secretary, Gus O'Donnell: "The Chancellor is keen that officials at the Treasury and the Bank work together to produce a joint proposal. As I understand it the latest proposal is not a joint one. The Chancellor needs to know the status of the proposal, what the difficulties are in drawing up a joint proposal, how you think we can move forward in achieving a joint proposal."
Three weeks later Mr Brown met the then Bank Governor Lord George for lunch to discuss the plan. But the outcome of the talks is unclear because the Treasury has blacked out a key section of the only note referring to it.
Lord George offered only the most lukewarm endorsement of the decision at the time, telling MPs it was a "perfectly reasonable portfolio decision."
If he had refused to agree to the sale he would almost certainly have had to resign.
The documents surrounding the gold sales were kept secret for years until the information commissioner ruled this month that they must be published following a freedom-of-information request.
Shadow Chancellor George Osborne said: "Under questioning from David Cameron, Gordon Brown said he would be happy to publish the truth about his disastrous decision to sell off Britain's gold at the bottom of the market. Now we see a key passage has been redacted. What has Gordon Brown got to hide? After all, we can't get the gold back. If he doesn't publish the documents in full, people will suspect there is a cover-up."
In a statement last night the Treasury said: "The proceeds of these sales were re-invested in interest-bearing foreign currency assets. Other central banks have adopted similar policies. As a result of this, the Treasury reduced the risk of volatility to the reserves by 30 per cent."
A Bank of England spokesman refused to comment.
Prophecy Resource Corp. Appoints Rob McEwen to Advisory Board
Prophecy Resource Corp. (TSX.V: PCY, OTC: PCYRF) is pleased to announce the appointment of Rob McEwen to the company's Advisory Board. McEwen is a leading Canadian mining industry entrepreneur. He is the chairman and CEO of U.S. Gold Corp. and Minera Andes Inc. McEwen was the founder and former chairman and CEO of Goldcorp Inc., whose Red Lake Mine in northwestern Ontario, Canada, is considered to be the richest gold mine in the world. During his tenure at Goldcorp, McEwen transformed the company from a collection of small companies into a mining powerhouse, growing its market capitalization from $50 million to approximately $8 billion.
For Prophecy Resource Corp.'s complete statement:
http://www.prophecyresource.com/news_2010_mar11b.php
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