Unlike other EU countries, Britain is, thankfully, independent of the European Central Bank in Germany. Britain's central bank is the Bank of England, affectionately known as "The Old Lady of Threadneedle Street" (up until the early 19th Century, Threadneedle Street was actually called Gropec**t Lane because it was famous for its prostitutes, so it could have had a more interesting nickname).
Underneath this venerable institution is stored £73 billion worth of gold bars.
This is the world's second-largest gold store, after America's Federal Reserve bank fault.....
The Big Picture: This vast vault of gold under the Bank of England should weather the credit crunch
By Mike Hanlon
22nd October 2008
Daily Mail
The Bank of England, on London's Threadneedle Street
You are looking at the room most likely to weather the credit crunch, a vast vault filled with the final word in financial security: gold.
As stocks and shares tumble, house prices crash and previously unassailable institutions crumble into dust, the sight of several thousand 28lb bars of 24-carat gold stored in the Bank of England's massive underground vaults is hugely reassuring.
For as the world wakes up to the fact that securities and dodgy loans are turning out to be as solid as wet cardboard, good old-fashioned gold has come back into fashion as never before.
Enlarge
Rock solid: Several thousand 28lb bars of 24-carat gold stored in the Bank of England's massive underground vault
Indeed, less than a decade ago, the noble metal was trading at a mere $275 an ounce.
Today, an ounce of gold fetches $787.80 (£460), making each of these bars worth around £200,000, or as much as a top-of-the-range Ferrari (and, before long, more than the average London house).
In fact, there are around 15,000 bars in this picture alone - that's about 210 tonnes of pure gold, with a value of nearly £3 billion. And there's plenty more out of view.
In fact, what you see here is just one-twentieth of the gold stored under the Old Lady of Threadneedle Street, as the Bank of England's City of London headquarters is affectionately known.
In all, some £73billion of gold - that's 4,600 tonnes of the stuff - is stored in concrete-lined vaults beneath the busy streets of central London. It never oxidises or tarnishes (so it doesn't need to be covered), although it does need the odd dust - by a cleaner who has been carefully vetted, no doubt.
Sadly, not all the gold beneath the Bank of England is ours.
It is a long time since the British currency was pegged to the value of gold (Britain left the Gold Standard in 1931), but we have always kept some as a reserve of last resort. Sadly, we haven't always bought and sold it wisely.
In May 1999, for example, the then-Chancellor, Gordon Brown, decided to sell 415 tonnes, or 60 per cent of the UK's total reserves.
Unfortunately, this sale took place at a time when gold prices reached historic lows. Had we held on to this gold, critics say, the Exchequer would now be £2billion better off.
In fact, most of the gold stored here is held by the Bank of England on behalf of other depositors, notably the central banks of various foreign governments who might not have access to such a secure cellar. The bars themselves are not identical.
The quality of the actual metal doesn't vary, but the slightly different shapes and marks reveal that it comes from various sources.
Security for the world's second-largest gold store (the largest, by a whisker, is the Federal Reserve bank vault in New York) is, predictably, rather tight.
The vaults are huge and include three disused wells. In fact, the floorspace is actually larger than that of the City's tallest building, Tower 42. Keys three-feet long are needed to open the gigantic vault doors.
They look ceremonial, like something used for a state occasion, but these keys are in fact entirely functional.
As they are inserted into the locks, the person attempting entry also has to speak a password into a microphone before the vaults are opened.
The Bank is, understandably, rather secretive about the precise details of the vaults. But the walls must be literally bombproof as they were used by bank staff as air raid shelters during World War II. The posters on the wall, depicting sunny climes, luxury cruises and happier times, have been preserved from that era.
As the world loses its faith in most investments, gold provides a primeval sense of security.
Of course, beyond being pretty (and its uses in electronic circuitry) the intrinsic value of gold is mostly symbolic, too.
But what would you rather have in your hands right now: a fistful of share certificates, or one of those bars?
dailymail.co.uk
Underneath this venerable institution is stored £73 billion worth of gold bars.
This is the world's second-largest gold store, after America's Federal Reserve bank fault.....
The Big Picture: This vast vault of gold under the Bank of England should weather the credit crunch
By Mike Hanlon
22nd October 2008
Daily Mail
The Bank of England, on London's Threadneedle Street
You are looking at the room most likely to weather the credit crunch, a vast vault filled with the final word in financial security: gold.
As stocks and shares tumble, house prices crash and previously unassailable institutions crumble into dust, the sight of several thousand 28lb bars of 24-carat gold stored in the Bank of England's massive underground vaults is hugely reassuring.
For as the world wakes up to the fact that securities and dodgy loans are turning out to be as solid as wet cardboard, good old-fashioned gold has come back into fashion as never before.
Enlarge
Rock solid: Several thousand 28lb bars of 24-carat gold stored in the Bank of England's massive underground vault
Indeed, less than a decade ago, the noble metal was trading at a mere $275 an ounce.
Today, an ounce of gold fetches $787.80 (£460), making each of these bars worth around £200,000, or as much as a top-of-the-range Ferrari (and, before long, more than the average London house).
In fact, there are around 15,000 bars in this picture alone - that's about 210 tonnes of pure gold, with a value of nearly £3 billion. And there's plenty more out of view.
In fact, what you see here is just one-twentieth of the gold stored under the Old Lady of Threadneedle Street, as the Bank of England's City of London headquarters is affectionately known.
In all, some £73billion of gold - that's 4,600 tonnes of the stuff - is stored in concrete-lined vaults beneath the busy streets of central London. It never oxidises or tarnishes (so it doesn't need to be covered), although it does need the odd dust - by a cleaner who has been carefully vetted, no doubt.
Sadly, not all the gold beneath the Bank of England is ours.
It is a long time since the British currency was pegged to the value of gold (Britain left the Gold Standard in 1931), but we have always kept some as a reserve of last resort. Sadly, we haven't always bought and sold it wisely.
In May 1999, for example, the then-Chancellor, Gordon Brown, decided to sell 415 tonnes, or 60 per cent of the UK's total reserves.
Unfortunately, this sale took place at a time when gold prices reached historic lows. Had we held on to this gold, critics say, the Exchequer would now be £2billion better off.
In fact, most of the gold stored here is held by the Bank of England on behalf of other depositors, notably the central banks of various foreign governments who might not have access to such a secure cellar. The bars themselves are not identical.
The quality of the actual metal doesn't vary, but the slightly different shapes and marks reveal that it comes from various sources.
Security for the world's second-largest gold store (the largest, by a whisker, is the Federal Reserve bank vault in New York) is, predictably, rather tight.
The vaults are huge and include three disused wells. In fact, the floorspace is actually larger than that of the City's tallest building, Tower 42. Keys three-feet long are needed to open the gigantic vault doors.
They look ceremonial, like something used for a state occasion, but these keys are in fact entirely functional.
As they are inserted into the locks, the person attempting entry also has to speak a password into a microphone before the vaults are opened.
The Bank is, understandably, rather secretive about the precise details of the vaults. But the walls must be literally bombproof as they were used by bank staff as air raid shelters during World War II. The posters on the wall, depicting sunny climes, luxury cruises and happier times, have been preserved from that era.
As the world loses its faith in most investments, gold provides a primeval sense of security.
Of course, beyond being pretty (and its uses in electronic circuitry) the intrinsic value of gold is mostly symbolic, too.
But what would you rather have in your hands right now: a fistful of share certificates, or one of those bars?
dailymail.co.uk
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