Gold hits all-time high of $1,500 an ounce (which means the amount Gordon flogged for £2bn would today fetch £13BILLION)

Short-changed: When sold at 1999 levels Gordon Brown got £2.3bn for 400 tons of gold. Today he would have got £12.95bn

The British economy was short-changed by almost £11billion when Gordon Brown sold 400 tons of Britain's gold reserves at rock-bottom prices.



Gold today rose above the $1,500 dollar-an-ounce barrier for the first time and a sale of the precious metal by the former Chancellor that raised £2.3billion would today have fetched a whopping £12.95billion.



The precious metal hit a fresh all-time high following Monday's shock debt downgrade warning for the U.S. which also resulted in a 31-year high for silver prices.



People are turning to the metals over fears for the global economy as they are believed to provide a safe investment.



Standard & Poor's sparked hefty share falls earlier this week when it slashed its outlook on U.S. government debt to negative from stable.



The move added to continuing concerns over Europe's sovereign debt crisis and rising global inflation.



The U.S. dollar has also been under pressure since the S&P blow, further fuelling the rise in gold prices. It was in 1999, that Gordon Brown sold off 400 tons of Britain's gold reserves at rock-bottom prices.



AND EVEN SILVER'S HIT A 31-YEAR HIGH Silver continued to charge ahead, rising to a 31-year high for the fifth consecutive session, as investors continued to favour gold's less expensive cousin. Spot silver rose to $44.34, a level unseen since 1980, before easing slightly to $44.25, up 0.8 per cent. Analysts and traders expected silver to continue to shine, as investors favour the metal, which benefits both from safe haven demand and growing industrial consumption.

'Silver is still in a clear bull trend that targets $50.00 next,' said Taso Anastasiou, a UBS technical strategist.



The then Chancellor sold the precious metal for between $256 and $296 an ounce, raising a fifth of what would have been paid today.



High oil prices and political tensions in areas such as the Middle East should keep gold strong for the time being, analysts said.

Darren Heathcote, head of trading at Investec Australia, said: 'There is not a great deal of reasons to sell it at the moment, apart from concerns that there are a lot of longs in the market and there is a risk of sell-off at some point.'

Technical analysis also points to a further rally in gold targeting $1,518, according to Reuters market analyst Wang Tao.

Some market watchers see gold consolidating at its current level as it waits for the next reason to push higher.



'I don't see prices convincingly past that level in the next few days unless we see something very negative, probably related to the Euro zone sovereign debt. But we do see gold very well supported at the $1,490 level,' said Natalie Robertson, commodities strategist at ANZ.



The record gold price helped mining stocks leap ahead on the London market, with shares in firms such as Rio Tinto and Anglo American as much as 3% higher.

Gold eased back at the start of the year after a run of positive economic data, but has since bounced back due to gloomy global developments.



The U.S. debt outlook downgrade compounded concerns following political tensions in the Middle East and North Africa, Japan's crisis and more eurozone woes.



Ireland's rating was slashed to just above junk status last week by Moody's, while Portugal is edging closer to a bailout.

The precious metal hit a fresh all-time high following Monday's shock debt downgrade warning for the U.S. which also resulted in a 31-year high for silver prices





