The “Dumbest” Money In the Market Is Selling Bitcoin

The “Dumbest” Money In the Market Is Selling Bitcoin

It proved to be a near $30 billion mistake.

The country’s “smartest” man in finance would turn out to be the country’s biggest fool.

On May 7, 1999, former United Kingdom Prime Minister Gordon Brown – who at the time was the Chancellor of the Exchequer (the UK’s equivalent of the U.S. Treasury Department) – announced his plans to sell half of the country’s gold reserves. His decision to sell marked a 20-year low in the gold price.

It has since been infamously called “The Brown Bottom.”

Over the next three years, Brown sold 395 tonnes of gold at an average price of $276 per ounce. Today, gold trades for more than $2,355 per ounce.

Has any individual Briton caused more financial damage to the country’s financial standing than Gordon Brown?

My point is this: Over the years, governments have proven to be terrible investors.

When 30-year U.S. government bond rates were hovering around 1.5% in 2020, the U.S. government got greedy and switched the bulk of its bond issuance to short-term rates that cost it 0.25% per year.

Today, that debt has to be refinanced at 5.37% — costing the government over $408 billion per year compared to $114 billion had it issued 30-year bonds instead.

We saw the U.S. government make a similar boneheaded decision when it auctioned off nearly 30,000 BTC in 2014.

At the time, the stash was worth about $18 million. Billionaire venture capitalist Tim Draper bought it on the cheap by the truckload.

Today, those coins are worth over $1.8 billion.

Fast-forward to today and we’re seeing Uncle Sam make the same mistake again…