Lyric discussion by GazzerMP 

I'm pretty certain that most of this song refers to Edinburgh, Scotland. Lots of drinking dens & taverns, graves and the monuments. There's the castle and the keep, and even tollgate. "...the ancient stones" refer to the Stone of Scone, the Scottish coronation stone that was broken in half and sits in Edinburgh Castle.

On Charlotte Street I take A walking stick from my hotel The ghost of Dirty Dick Is still in search of Little Nell

Charlotte Street is near the Castle, in the Edinburgh New Town, and Dirty Dick's is pub near there.

I agree 100%. Saw Mark Knopfler live a few months after visiting Edinburgh, and I realized the connection. I think the production and feel on the album version really captures the feel of that city as well.

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