Gold Fever Sweeps Suburbia

Gold Fever Sweeps Suburbia

As prices soar and personal finances sour, Californians are selling off their
old jewelry to generate extra cash.

Los Angeles Times
by: Tiffany Hsu
Feb. 21, 2009

Gold is hot. The precious metal soared $25.70 an ounce Friday to $1,001.80, topping the $1,000 mark for the first time in nearly a year. South African Krugerrands, American Eagles and other gold coins are in demand as people seek safe investment havens in uncertain times.

That has people digging through their drawers and jewelry boxes looking for watchbands, cuff links, chains and bracelets that can be sold to jewelers, pawnshops and other brokers to be melted down to feed the growing demand for gold coins.

So far this year, the price of gold has risen by 13%, while the Dow Jones industrial average has tumbled 16%.

[D]emand appears to be growing. The U.S. Mint shipped 92,000 1-ounce American Eagle coins to its dealer network in January, up sharply from 22,500 in January 2008.

On Cloverfield Boulevard in Santa Monica, Goldline International Inc. caters to investors looking to buy thousands of dollars in gold bars or coins such as the American Eagle.

Chief Executive Mark Albarian said that until late last year his staff was making about 100 sales a day with an average order of about $5,000. Now the firm is closing nearly 300 deals daily with an average order of about $13,000, he said.

On Friday, total sales exceeded $5 million, he said.

"A few years ago, the scene was pretty quiet, but business has pretty much tripled," Albarian said. "Most businesses worry these days about not having enough customers. Gold businesses worry about running out of product."

The above information has been redacted from the article as it originally appeared in The Los Angeles Times.

Release Date: 
Saturday, February 21, 2009