UK government joins the gold bandwagon, top is declared
Commentator Steve Peel declares that if the UK government sold all its gold at the bottom of the market, bullion must have reached a top if the country is buying again:
It's official – the bull run in Gold is over.
Gordon Brown's sale of 400tons of gold in 1999 marked the end of gold's bear market: George Osborne's announcement that the Treasury has been buying gold marks the end of gold's bull market. Politicians are crowd followers – they react to situations. Everyone saw the price falling lower and lower so Brown offloaded Britain's gold; we all saw the price climbing higher and higher so Osborne climbs aboard the band wagon and loads up. Because they are trend followers, their actions are always very late in the trend, and by the time they proudly announce their sales or purchases the market is turning. Politicians worldwide, whatever their persuasion, are always on the wrong side of the market.
Marketwatch wondered the same back in September 2011 when Donald Trump began accepting gold payment for some of his properties, and gold was at $1,620/oz. Six months later gold is up 2.5% to $1,660/oz.