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horgad
1000+ Penny Miser Member
USA
1641 Posts |
 Posted - 03/12/2008 : 07:25:00
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A Gold Rush is taking place as the average guy/gal scrambles to unload their gold...my guess that this is a huge buy signal. Average guys/gals never and mean never sell at the top! More typically they buy at the top and sell after the crash...
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Gold Prices Push Consumers to Sell
Tuesday March 11, 12:52 pm ET
By Dave Carpenter, AP Business Writer
AP Centerpiece: There's Gold in Them Thar Jewelry Boxes: Consumers Sell Gold for Top Dollar
CHICAGO (AP) -- A new kind of gold rush is unfolding at jewelry store and pawn shop counters -- featuring not prospectors, but consumers.
White-collar workers, retirees and many others have been digging through jewelry boxes and safety deposit boxes to cash in as gold prices flirt with $1,000 an ounce. Coins, old wedding rings, necklaces given by ex-boyfriends, hand-me-down gold pieces -- everything is fair game when it brings this kind of profit.
Shop owners across the country are marveling about the phenomenon they say began in the latter part of 2007 and accelerated through the winter, reflecting torrid gold demand like none had ever seen. There are even gold parties, where people gather to sell their jewelry.
"Everybody's trying to sell," said Richard Rozhko, owner of a jewelry store on the northern edge of Chicago. "People are trying to cash out because they don't believe that gold's going to go higher than $1,000 or $1,200" an ounce.
Rachel Weingarten, a New Yorker with a self-described obsession with "shiny trinkets," didn't need to sell but couldn't resist the chance when she saw prices soar like an overinflated tech stock.
"When I saw the prices going through the roof, I saw it as an amazing opportunity to rid myself of jewelry that no longer suits my taste or status," said Weingarten, a marketing consultant. "It's also been a lot of fun to get cash for stuff that is broken or just really ugly or just takes up room in my drawers."
Royal Pawn Shop, a 75-year-old business within earshot of the rattle of passing El trains in Chicago's South Loop, has display cases sporting fancy gold rings, bracelets and watches along with racks holding hundreds of pawned fur coats. It also has more office workers as customers these days -- mostly sellers, not buyers, bringing in gold chains and rings.
"It's stuff that's lying around the house, so they figure: Why not make money from it?" said co-owner Wayne Cohen. "The price of gold is so ridiculously high that they'd be stupid not to get rid of it."
Others are selling to help cope with tough times in an economic slowdown.
Three miles across town, Division Gold store owner John Vela recounted housewives coming in to pawn treasured items from their jewelry boxes and numerous clients saying they need money to pay their property tax bills and take care of other rising financial obligations.
"I have mortgage brokers, real estate agents, retail shop owners. They're nervous, you can see the stress on their faces," he said. "Many haven't been to a pawn shop before -- they want to know how it works. Some don't want to let go of their gold. (But) gold is cash to them."
Silver also is stirring customers to sell more, with prices having more than tripled from $6 per troy ounce two years ago to over $20.
The stories are similar elsewhere.
At Gold Star Pawn Shop in Eastlake, Ohio, where the Cleveland-area economy is suffering, manager Marc Berman said people come in regularly with broken gold chains, rings with marks on them and scrap gold to get more money in their pockets.
"I think it's more about gas prices than anything else," he said. "People are bringing in anything to try to get money to put a few gallons in the tank."
Some seniors come in monthly to pawn gold items in order to make it through until their next Social Security checks arrive, Berman said.
The clientele at Palace Pawnbrokers in downtown San Diego has gone more upscale as gold prices have soared. Owner Jeff Bernard said it's a mixture of those who seem to need the money more than ever and those who want it.
"It's a combination of many factors -- the state of the economy, the price of a gallon of unleaded gas going for $3.60 here," he said. "People are saying 'We've just got to do something.' With gold knocking on the $1,000 door, they can actually pay off a bill, do something significant with it."
One woman recently lugged a safety deposit box full of old wedding rings, chains and gaudy 14-karat jewelry from the 1970s in to Scott Goldstein's Super Pawn shop in Round Lake Beach, Ill. Others have arrived carrying shoeboxes full of jewelry, and a 92-year-old man brought in 80 gold coins. Customers have brought in as much as 40 ounces of gold to sell, he said.
"It's people going through hard times AND the crazy prices," Goldstein said of the crush that began there after Christmas. "With all the foreclosures nowadays, you hear people more and more saying 'I've got a mortgage to pay.'"
Midge Elias watched prices rise for months until she finally gave in to the temptation and walked into a Manhattan coin shop with two mounted Liberty Walking gold pieces she'd once worn on long chains. She left with a check for $1,150.
"It felt like a little gift," Elias said. "Of course, there's always the possibility of gold going way higher. But hey, those are the risks."
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HoardCopperByTheTon
Administrator
USA
6807 Posts |
 Posted - 03/12/2008 : 10:06:50
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I agree.. the majority is always wrong. I think part of the rush is fueled by folks worrying about the economy and trying to get cash for the coming hard times or just to pay the gas and grocery bill today.
I also think that gal got ripped on the those double eagles.. C'mon.. $575 each for jewelry grade $20 gold pieces with gold bezels? And he didn't even pay in cash! She got fleeced! Maybe they were smaller modern fractional pieces.. but what do you want to bet they were double eagles? |
If your percentages are low.. just sort more. If your percentages are high.. just sort more.
Now selling Copper pennies. 1.6x plus shipping. Limited amounts available. |
Edited by - HoardCopperByTheTon on 03/12/2008 10:09:17 |
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starwarsgeek171
Penny Hoarding Member
USA
651 Posts |
Posted - 03/12/2008 : 21:06:27
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| Would borrowing money to buy gold make sense at this point? |
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n/a
deleted
192 Posts |
Posted - 03/12/2008 : 22:33:48
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starwars:
You are asking for opinions not facts.
Here is my opinion:
NO.
Get out of debt!
Do Not get into Debt!
That is my opinion. |
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The market can stay irrational longer than you can stay solvent.
John Maynard Keynes,
English economist (1883 - 1946)
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El Dee
Penny Hoarding Member
USA
547 Posts |
Posted - 03/12/2008 : 22:44:42
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If the dollar continues to drop, heck yes - you'll pay off your loan with cheap inflated dollars.
If the dollar holds, and gold continues to rise, heck yes - you've bought in during a rising market.
If gold crashes, you're left owing money on something not worth your borrowings - exactly like the housing bubble.
I'd be rich if I could read the future. |
Trust the government? Ask an Indian. |
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misteroman
Administrator
USA
2565 Posts |
Posted - 03/13/2008 : 00:50:53
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I actually have a few gold chains I was thinking about taking in and selling.Wonder what they are worth?
Derek |
Buying CU cents!!!! Paying 1.2 unlimited amounts wanted. Can pick up if near Ohio area. |
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HoardCopperByTheTon
Administrator
USA
6807 Posts |
Posted - 03/13/2008 : 02:18:33
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| It depends what the fineness of the gold is and what the weight is. You might be able to trade them for wheat cents. |
If your percentages are low.. just sort more. If your percentages are high.. just sort more.
Now selling Copper pennies. 1.6x plus shipping. Limited amounts available. |
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WilliamC
Penny Collector Member
USA
471 Posts |
Posted - 03/13/2008 : 06:28:48
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quote:
Originally posted by starwarsgeek171
Would borrowing money to buy gold make sense at this point?
Only if you are much more risk-tolerant than I.
Personally I owe nothing but a mortgage and I pay a bit extra on that each month because I want to be rid of it too.
But I know many investment gurus will say the fastest way to wealth is to invest with other peoples money.
So it's up to you and your emotions really.
If you are fairly young, single, and have no consumer debt, and are willing to live very much below your means, then perhaps it could work.
But if you tend to spend more than you make, or if you have dependents, then I wouldn't even consider it. |
Sorting In Northwest Mississippi |
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starwarsgeek171
Penny Hoarding Member
USA
651 Posts |
Posted - 03/13/2008 : 09:50:41
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| I am 39, The loan payment money would come from discretionary income, and would not affect any other monetary reponsibilities and/or investment strategies. I only have a mortgage (with a fair ammount of equity); I have no car loan or other debt that I need to worry about. Ell De hit it just right with one of his points; I truly feel that I'll be paying for something that's rising in value, as the fiat currency I'm paying the loan off with decreases in value. I just feel as though I have little to lose (30-40% at best in the short term, and that could be written off on my taxes if I wanted to sell) and much to gain (gold could go to $1,600+). |
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horgad
1000+ Penny Miser Member
USA
1641 Posts |
Posted - 03/13/2008 : 10:08:34
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quote:
Originally posted by starwarsgeek171
I am 39, The loan payment money would come from discretionary income, and would not affect any other monetary reponsibilities and/or investment strategies. I only have a mortgage (with a fair ammount of equity); I have no car loan or other debt that I need to worry about. Ell De hit it just right with one of his points; I truly feel that I'll be paying for something that's rising in value, as the fiat currency I'm paying the loan off with decreases in value. I just feel as though I have little to lose (30-40% at best in the short term, and that could be written off on my taxes if I wanted to sell) and much to gain (gold could go to $1,600+).
It is certainly a personal decision based on you financial situation, age, and risk tolerance. So I am trying to refrain from commenting too much. But do take some time to look closer into the tax implications.
If you are not careful you will end up paying extra taxes that will eat into profit. The interest you are paying on your loan ideally needs to be fully deductible against your gains. This get a little fuzzy if you are using a home loan. The deduction that you get for interest on a home loan is not nearly as good as the one that you get from investment related interest expenses (like when you have a margin account at a brokerage).
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Edited by - horgad on 03/13/2008 12:27:48 |
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starwarsgeek171
Penny Hoarding Member
USA
651 Posts |
Posted - 03/13/2008 : 11:25:09
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| Thank you, Horgad. I'll be sure to crunch the numbers before signing on the dotted line. |
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misteroman
Administrator
USA
2565 Posts |
Posted - 03/13/2008 : 11:40:50
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I guess gold futures hit $1k today for the first time ever
Derek |
Buying CU cents!!!! Paying 1.2 unlimited amounts wanted. Can pick up if near Ohio area. |
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starwarsgeek171
Penny Hoarding Member
USA
651 Posts |
Posted - 03/13/2008 : 11:41:56
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| Whew, that makes me feel better! |
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WilliamC
Penny Collector Member
USA
471 Posts |
Posted - 03/14/2008 : 05:36:03
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Spot prices traded briefly above $1,000 per ounce yesterday according to kitco.com market report.
I'm guessing (hoping) it might be stable here for at least a little while as lot's of speculators start selling off their gold.
So $1,050 is the next test price now? Support at $975? |
Sorting In Northwest Mississippi |
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NotABigDeal
1000+ Penny Miser Member
USA
3890 Posts |
Posted - 03/14/2008 : 06:35:26
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Still buying here....
Deal |
Live free or die.
Plain and simple.
"If you love wealth more than liberty, the tranquility of servitude better than the animating contest of freedom, depart from us in peace. We ask not your council or your arms. Crouch down and lick the hand that feeds you. May your chains rest lightly upon you and may posterity forget that you were our countrymen."
- Samuel Adams |
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HoardCopperByTheTon
Administrator
USA
6807 Posts |
Posted - 03/14/2008 : 13:09:30
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| I thought for sure since I bought some the last few days that it would go down.. LOL Usually any time I buy it goes down.. if I sell, it goes up. Seems I can no longer singlehandedly turn the market. |
If your percentages are low.. just sort more. If your percentages are high.. just sort more.
Now selling Copper pennies. 1.6x plus shipping. Limited amounts available. |
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wolvesdad
1000+ Penny Miser Member
USA
2164 Posts |
Posted - 03/14/2008 : 14:32:19
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The silver I bought, I bought at less than $16 an ounce. With the drop of the dollar I can hardly imagine that SIlver will EVER drop anything more than a few cents or at most, a dollar, below that. I wish I had bought more(and I would have if I could have). But I really think that current prices are about the low water mark for PM's over the next 2-5 years, and maybe forever.
I mean, what at all!!!! could raise the value of the dollar to what it was a year ago? Not with the FED just pumping out more and more money.... and more mortgage issues maturing(or rotting!?).
Silver six months ago, silver a year ago...was, as Mad Money's Cramer says, "BUY, BUY, BUY!"
I'll probably be saying the same thing in 6 months and in a year... but I'm hoping for a drop down to $17 before then! If it does I will again buy whatever I can. Sell some of my books, sell all my scrap copper(not the cents), sell plasma maybe even, to buy some more if it drops to $17 an ounce! |
"May your percentages ever increase!" |
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HoardCopperByTheTon
Administrator
USA
6807 Posts |
Posted - 03/14/2008 : 19:24:37
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| Woohoo! Gold closed above $1000! Can the Silver rush be far behind? |
If your percentages are low.. just sort more. If your percentages are high.. just sort more.
Now selling Copper pennies. 1.6x plus shipping. Limited amounts available. |
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wheeler_dealer
Penny Collector Member
USA
402 Posts |
Posted - 03/15/2008 : 13:47:20
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Starwars,
I too thought of borrowing to buy. Consider what you goal is
1. Wealth protection-
2. Investment for return
3 Are you willing to risk the value of gold dropping
4 Can you meet the payments if you lose employment.
Speculation is different from investment
Something to consider which might help
With a mortgage: if you speculate(ex: buy 6 one ounce gold coins at spot) you could if times get tough use them as an insurance by cashing in one a month to pay your mortgage while still making the payments on your loan. If you become unemployed, You still have mortgage payments and loan payments and will have gained nothing.
If you have disposable income and want to invest start small. Maybe enough to buy a few ounces, make payments, wait for the price to rise. if you are still o.k. dabble a little more.
Be careful The streets are littered with carcasses of people who speculated and lost. Will you be o.k. if you lost you $$$$$...
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Gold Rush
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