Your theory as to why there are so many CASH 4 GOLD and WE BUY GOLD stores. - Page 2

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[ARCHIVED THREAD] - Your theory as to why there are so many CASH 4 GOLD and WE BUY GOLD stores. (Page 2 of 3)

Posted: 5/11/2013 10:36:20 AM EDT

[#1]

Quoted:
Simple. People need cash, most dont know anything about spot price, where to find it, how it fluctuates, etc. Same people will sell their gold for a fraction of it's worth, thinking they are making out like gangbusters.

But these places didn't exist (at least not around me) till a couple of years ago.

Posted: 5/11/2013 10:37:47 AM EDT

[#2]

Quoted:
buy low, sell high?

What exactly are you getting at?

Why now? That's what I'm asking.

Why are they everywhere now?

Posted: 5/11/2013 10:39:22 AM EDT

[#3]

Quoted:
Gold is at $1500/oz. You have a little 14k ring. You know nothing about karats, gold price or the weight of the ring, you just need cash and it's a ring you don't need. The store knows that it's 5 grams and is worth $140. They offer $75. You say "Oh, wow, this little thing is worth $75! Woohoo!" They make a 43% profit, and you're happy.

But this could have been done five, ten, or twenty years ago......but it wasn't.

Posted: 5/11/2013 10:41:39 AM EDT

[#4]

Quoted:
Because pawn shops are too hot to move stolen jewels these days. Not even kidding. You know exactly what the target market is for shit like this.

A friend of mine, that in all fairness, could be defined as ghetto (Uneducated, unemployed, actually was in a gang for a while) went to one of these places with a $500 necklace he bought for his mom a while back that she never wore. He walked out of the shop with $13.

Granted it was a khols necklace and objectively wasn't worth much in metal content, but he could have pawned it for more than $13 bucks. hell he could have sold it on craigslist for more than that.

these places thrive on stupid people desperate for money, and criminals that need to dump hot stuff as fast as possible.

But there have been criminals and desperate people around for a lot longer than the last couple of years.

Posted: 5/11/2013 10:42:03 AM EDT

[#5]

Quoted:

Quoted:
Years ago I read a story that said the Fed Res was the ultimate buyer. I also read that the Red Chinese were. Dunno. Exporting gold runs into Customs issues.

BTW, saw the We Buy Gold stores in South & Central America, Europe too. They only close when the public has no more gold to sell (think Spain).

China's importing gold by the fuck ton right now because they know our economy's about to shit bricks, but I don't think they're the ones running cash for gold.

Or maybe because there's the new middle class in China that can afford it. Asians, especially Indians and Chinese have a gold fetish.

And what good is gold? It's useful in some electronics as a conductor, that's it. It's not the 14th century.

It's a rare heavy element, and therefore will always be valuable.

Unlike diamonds.

Posted: 5/11/2013 10:42:35 AM EDT

[#6]

Quoted:
i like the tv ads where you mail them your stuff and then they mail you a check.

I was just thinking about those ads!

But I haven't seen them in a while.

Posted: 5/11/2013 10:43:41 AM EDT

[#7]

Quoted:
Years ago I read a story that said the Fed Res was the ultimate buyer. I also read that the Red Chinese were. Dunno. Exporting gold runs into Customs issues.

BTW, saw the We Buy Gold stores in South & Central America, Europe too. They only close when the public has no more gold to sell (think Spain).

Yes, this is my theory.

Never read it anywhere, but it's the only thing that makes sense to me.

Posted: 5/11/2013 10:44:19 AM EDT

[#8]

Quoted:
Seriously?

Is there really any question at all

Dude, don't get like that.

Participate!

Posted: 5/11/2013 10:44:37 AM EDT

[#9]

Quoted:
I used to manage a gold store. It's really no different than running a gun store taking in trades. They have rent, ins, payroll, taxes and other expenses to run a business. Plus ya have to hold the jewelry for anywhere from 7-10 days. Depending on what ya paid for it then and spot price now can determine how much ya really make. Plus if ya have ever been in the business, stones ( diamonds) really aren't worth shit. We would give them back to the customers. And what most people don't understand is 14k gold isn't pure gold. They see $1500 spot and think that's what it's worth. 14k gold is only 58.5% gold and 10k is only 41.7%. So right there makes 1oz of 14k only worth $875. Then ya gotta subtract the fees ya get charged to send to the refiner to have it melted (usually 10%) plus shipping and insurance. Now it's down to $750 per ounce. Then ya gotta pay rent and all those other things. The problem is the over-priced 600% markup jewelry stores do. If you weighed the same 14k ring with 1kt solitare it's only worth $500 tops. But jewelry stores sell it for $5000. That's why people get so pissed when ya tell them ya can only give them $300 for their $5000 ring

Yep, we have an airheaded woman at work who refused to believe that diamonds aren't worth anything.

Posted: 5/11/2013 10:46:13 AM EDT

[#10]

Quoted:

Quoted:
Years ago I read a story that said the Fed Res was the ultimate buyer. I also read that the Red Chinese were. Dunno. Exporting gold runs into Customs issues.

BTW, saw the We Buy Gold stores in South & Central America, Europe too. They only close when the public has no more gold to sell (think Spain).

China's importing gold by the fuck ton right now because they know our economy's about to shit bricks, but I don't think they're the ones running cash for gold.

Bingo.

Posted: 5/11/2013 10:46:25 AM EDT

[#11]

Quoted:
Because 5% of $1400 to $1800 is a lot more money than 5% of $400.

That is basically what it boils down to.

Ok, but I'm gonna call in the black helicopters on this one.

It's deeper than that!

Posted: 5/11/2013 10:46:40 AM EDT

[#12]

Quoted:

Quoted:
Gold is at $1500/oz. You have a little 14k ring. You know nothing about karats, gold price or the weight of the ring, you just need cash and it's a ring you don't need. The store knows that it's 5 grams and is worth $140. They offer $75. You say "Oh, wow, this little thing is worth $75! Woohoo!" They make a 43% profit, and you're happy.

Around here they'd offer 25

The local "We Buy..." offers 50% of spot and acts like they are doing you a favor.
That's for actual bullion/rounds. Scrap is more like 15%.

Posted: 5/11/2013 10:49:50 AM EDT

[#13]

Quoted:
How would a business go beyond supply and demand?

If there are forces at work behind the rise of the "Gold 4 Cash" stores then it does go beyond that.

As far as the little stores go, it's just, "Hey, open a store, put a dude at the curb with a sign, and get paid".

However, if, as I believe, the real end goal of all of this is for the US government to accumulate as much gold as possible regardless of the cost, then it goes beyond market forces.

Posted: 5/11/2013 10:50:15 AM EDT

[#14]

Quoted:
There's a good buck to be made in fencing.

Yep.

I get the pawn slips/sales receipts. its like a whose who of petty theives and drug addicts. respectable shops put good descriptions on the receipts. shady shops use therms like "scrap gold"

Posted: 5/11/2013 10:50:40 AM EDT

[#15]

Quoted:
The thing that gets me are those stores are worldwide.

ETA: Think of it as a Roosevelt Bankers' Dream. Confiscation of gold with the consent of the people. Instead of burying the yellow stuff, they willingly turn it in.

Yes!

This is the play.

Posted: 5/11/2013 10:50:41 AM EDT

[#16]

Quoted:

Quoted:
buy low, sell high?

What exactly are you getting at?

Why now? That's what I'm asking.

Why are they everywhere now?

Same reason you see a lot more silver coinage in circulation.
The economy tanked, people are converting what they can to cash to buy cigarettes and such.

Posted: 5/11/2013 10:51:11 AM EDT

[#17]

Quoted:

Quoted:
There's a good buck to be made in fencing.

Will they take a lump of slag gold? Not many ghetto goblins are adept at smelting, but I've always wondered.

Yes. very common for crooks to melt down stolen jewelry before selling it as scrap.

Posted: 5/11/2013 10:56:45 AM EDT

[#18]

Quoted:

Quoted:
Years ago I read a story that said the Fed Res was the ultimate buyer. I also read that the Red Chinese were. Dunno. Exporting gold runs into Customs issues.

BTW, saw the We Buy Gold stores in South & Central America, Europe too. They only close when the public has no more gold to sell (think Spain).

China's importing gold by the fuck ton right now because they know our economy's about to shit bricks, but I don't think they're the ones running cash for gold.

Or maybe because there's the new middle class in China that can afford it. Asians, especially Indians and Chinese have a gold fetish.

And what good is gold? It's useful in some electronics as a conductor, that's it. It's not the 14th century.

The people who were wiped out by the currency crises that took place in Weimar Germany, Argentina, Yugoslavia, CCCP, Zimbabwe, and others, would have given anything to have their assets in gold rather than paper. I know some of them. They've been guests in my home. It actually happened to real people.

Posted: 5/11/2013 10:58:14 AM EDT

[#19]

There was a Gold Max store in an old fast food place in my area for probably no more than 3-4 weeks last year. It was then converted into a Title Max location, which is still open.

Posted: 5/11/2013 11:00:24 AM EDT

[#20]

Quoted:

Quoted:
buy low, sell high?

What exactly are you getting at?

Why now? That's what I'm asking.

Why are they everywhere now?

Same reason you see a lot more silver coinage in circulation.
The economy tanked, people are converting what they can to cash to buy cigarettes and such.

We've had bad economic times before. Inflation, gas lines, ultra high interest rates, etc.

No "Cash 4 Gold" stores then.

Posted: 5/11/2013 11:01:13 AM EDT

[#21]

I would love to own a combination Payday&title loan/cash for gold/furniture rental store.

Posted: 5/11/2013 11:01:54 AM EDT

[#22]

Quoted:
I used to manage a gold store. It's really no different than running a gun store taking in trades. They have rent, ins, payroll, taxes and other expenses to run a business. Plus ya have to hold the jewelry for anywhere from 7-10 days. Depending on what ya paid for it then and spot price now can determine how much ya really make. Plus if ya have ever been in the business, stones ( diamonds) really aren't worth shit. We would give them back to the customers. And what most people don't understand is 14k gold isn't pure gold. They see $1500 spot and think that's what it's worth. 14k gold is only 58.5% gold and 10k is only 41.7%. So right there makes 1oz of 14k only worth $875. Then ya gotta subtract the fees ya get charged to send to the refiner to have it melted (usually 10%) plus shipping and insurance. Now it's down to $750 per ounce. Then ya gotta pay rent and all those other things. The problem is the over-priced 600% markup jewelry stores do. If you weighed the same 14k ring with 1kt solitare it's only worth $500 tops. But jewelry stores sell it for $5000. That's why people get so pissed when ya tell them ya can only give them $300 for their $5000 ring

Ya, ya, ya...

Posted: 5/11/2013 11:03:16 AM EDT

[#23]

Quoted:

Quoted:
buy low, sell high?

What exactly are you getting at?

Why now? That's what I'm asking.

Why are they everywhere now?

Same reason you see a lot more silver coinage in circulation.
The economy tanked, people are converting what they can to cash to buy cigarettes and such.

We've had bad economic times before. Inflation, gas lines, ultra high interest rates, etc.

No "Cash 4 Gold" stores then.

Yes, there were.
You just weren't seeing them. It was a big deal during Carter/Reagan1.

Posted: 5/11/2013 11:04:39 AM EDT

[#24]

Quoted:

Quoted:
buy low, sell high?

What exactly are you getting at?

Why now? That's what I'm asking.

Why are they everywhere now?

Same reason you see a lot more silver coinage in circulation.
The economy tanked, people are converting what they can to cash to buy cigarettes and such.

We've had bad economic times before. Inflation, gas lines, ultra high interest rates, etc.

No "Cash 4 Gold" stores then.

Yes, there were.
You just weren't seeing them. It was a big deal during Carter/Reagan1.

Yes, even local stores like Big 5 in California had days where you could bring in gold/silver coins to trade for things like TVs and such.

Posted: 5/11/2013 11:05:27 AM EDT

[#25]

Cash 4 Gold offerec about 25-30% of gold value ....Midwest Refiners offered spot less a few bucks.

Are they competitive now?

Posted: 5/11/2013 11:14:07 AM EDT

[#26]

Quoted:
.......................And what good is gold? It's useful in some electronics as a conductor, that's it. It's not the 14th century.

I hear this a lot, "Gold has no intrinsic value!"

Let's assume this is 100% undeniably correct.

Then why do central governments hold a shitpot full of the stuff?

Quoted:

Quoted:
Gold is at $1500/oz. You have a little 14k ring. You know nothing about karats, gold price or the weight of the ring, you just need cash and it's a ring you don't need. The store knows that it's 5 grams and is worth $140. They offer $75. You say "Oh, wow, this little thing is worth $75! Woohoo!" They make a 43% profit, and you're happy.

But this could have been done five, ten, or twenty years ago......but it wasn't.

Sure it was. Every time things get rough and people are more inclined to sell their gold, or the price of gold goes up and the buy/sell spread makes it worthwhile these places spring up, or, being primarily in the jewelry business, etc., focus more on buying gold and silver they can sell for a larger margin than customary.

Posted: 5/11/2013 11:14:58 AM EDT

[#27]

Quoted:

Quoted:
Years ago I read a story that said the Fed Res was the ultimate buyer. I also read that the Red Chinese were. Dunno. Exporting gold runs into Customs issues.

BTW, saw the We Buy Gold stores in South & Central America, Europe too. They only close when the public has no more gold to sell (think Spain).

China's importing gold by the fuck ton right now because they know our economy's about to shit bricks, but I don't think they're the ones running cash for gold.

Or maybe because there's the new middle class in China that can afford it. Asians, especially Indians and Chinese have a gold fetish.

And what good is gold? It's useful in some electronics as a conductor, that's it. It's not the 14th century.

Wanna bet?

Posted: 5/11/2013 11:18:51 AM EDT

[#28]

Quoted:

Quoted:
There's a good buck to be made in fencing.

really I did it for a while and ended up bruised, with sore legs and a lighter wallet..

Were you using Bonetti’s Defense against your opponent?

Everythingy depends on the weapon and the opponent. Foil's kinda wimpy, epee's ok, and saber is more fun than anything except sex.

Posted: 5/11/2013 11:29:04 AM EDT

[#29]

Because people will sell at less than the market price so they can afford to go to the Dollar store and have a real good time.

Posted: 5/11/2013 11:29:22 AM EDT

[#30]

They were all over the place back in the early 80s as well.

Posted: 5/11/2013 11:34:51 AM EDT

[#31]

Title loan places have my attention. They open and close all the time around here. Some have been open for a few years. But you never see anyone at the stores. A few employees come and go but never customers. Payments can be mailed but you never see anyone in there handing in their titles and signing papers. I wonder if some of them are fronts for money laundering.

Posted: 5/11/2013 11:35:22 AM EDT

[#32]

Not a theory. Here's the truth (at least in my AO)......

It's fueled by crime. Criminals have to give ID and thumbprint to pawn all the crap they steal(which fuels addiction) as far as tools/electronics/etc.

MOST burglaries we work now the suspect bypasses expensive electronic and other items. Goes right to the gold jewelry, then to the "gold buyers". No pawn records. Cash that day.

Posted: 5/11/2013 11:51:29 AM EDT

[#33]

Quoted:

Quoted:
buy low, sell high?

What exactly are you getting at?

Why now? That's what I'm asking.

Why are they everywhere now?

Same reason you see a lot more silver coinage in circulation.
The economy tanked, people are converting what they can to cash to buy cigarettes and such.

We've had bad economic times before. Inflation, gas lines, ultra high interest rates, etc.

No "Cash 4 Gold" stores then.

Yes, there were.
You just weren't seeing them. It was a big deal during Carter/Reagan1.

Ok, I guess they just weren't around where I lived.

I think I would have remembered.

Posted: 5/11/2013 11:52:13 AM EDT

[#34]

Quoted:

Quoted:
There's a good buck to be made in fencing.

Will they take a lump of slag gold? Not many ghetto goblins are adept at smelting, but I've always wondered.

No.

First, most people couldn't make a lump of slag gold, not without it being of questionable purity.

Second, there is a growing number of fake gold bars around. They're thick gold molded around a non precious metal. Buyers are getting nervous about the rip-offs that appear to be totally legitimate. The scrappers they deal with will pay the spot price, less their discount, when they buy it, but if it turns out to be fake, they'll deduct the payment for the fake from their next purchase.

Posted: 5/11/2013 12:04:16 PM EDT

[#35]

And this is why I got this ring that would have cost $1-2k for $450

I laugh at guys who tell me they spent $5-8k for a $2k ring

Quoted:
I used to manage a gold store. It's really no different than running a gun store taking in trades. They have rent, ins, payroll, taxes and other expenses to run a business. Plus ya have to hold the jewelry for anywhere from 7-10 days. Depending on what ya paid for it then and spot price now can determine how much ya really make. Plus if ya have ever been in the business, stones ( diamonds) really aren't worth shit. We would give them back to the customers. And what most people don't understand is 14k gold isn't pure gold. They see $1500 spot and think that's what it's worth. 14k gold is only 58.5% gold and 10k is only 41.7%. So right there makes 1oz of 14k only worth $875. Then ya gotta subtract the fees ya get charged to send to the refiner to have it melted (usually 10%) plus shipping and insurance. Now it's down to $750 per ounce. Then ya gotta pay rent and all those other things. The problem is the over-priced 600% markup jewelry stores do. If you weighed the same 14k ring with 1kt solitare it's only worth $500 tops. But jewelry stores sell it for $5000. That's why people get so pissed when ya tell them ya can only give them $300 for their $5000 ring

Posted: 5/11/2013 12:06:02 PM EDT

[#36]

The greatest generation is dying off at a fast clip.

Boomer kids are selling their inherited gold items for another tat, plastic surgery, etc.

Posted: 5/11/2013 12:10:41 PM EDT

[#37]

money laundering
Gold buying is the front, most of the scrap gold has already been sold in the last 5 years, unless its stolen!

Posted: 5/11/2013 12:13:18 PM EDT

[#38]

Quoted:

Quoted:
Gold is at $1500/oz. You have a little 14k ring. You know nothing about karats, gold price or the weight of the ring, you just need cash and it's a ring you don't need. The store knows that it's 5 grams and is worth $140. They offer $75. You say "Oh, wow, this little thing is worth $75! Woohoo!" They make a 43% profit, and you're happy.

But this could have been done five, ten, or twenty years ago......but it wasn't.

With the price of gold at this level, a lot of people sell. The other side of that is that the spot price has hurt the jewelry business. The stuff is too expensive for a lot of people. A chain that used to cost $200 now costs $1,000. The price of gold is insane right now. At some point, it is going to tank, big time.

ETA - our scrappers took 5%, so yes, we made a nice profit on gold. Don't like it? No one is forcing you to sell to us.

RANGER_556, your local SO should be all over the ones buying with no paper. They're doing exactly what you said they're doing and everybody knows it.

Posted: 5/11/2013 12:14:30 PM EDT

[#39]

Quoted:
Because

these places thrive on stupid people desperate for money, and criminals that need to dump hot stuff as fast as possible.

Mostly the latter

melt and run

Posted: 5/11/2013 12:18:19 PM EDT

[#40]

Quoted:

Quoted:
Gold is at $1500/oz. You have a little 14k ring. You know nothing about karats, gold price or the weight of the ring, you just need cash and it's a ring you don't need. The store knows that it's 5 grams and is worth $140. They offer $75. You say "Oh, wow, this little thing is worth $75! Woohoo!" They make a 43% profit, and you're happy.

But this could have been done five, ten, or twenty years ago......but it wasn't.

With the price of gold at this level, a lot of people sell. The other side of that is that the spot price has hurt the jewelry business. The stuff is too expensive for a lot of people. A chain that used to cost $200 now costs $1,000. The price of gold is insane right now. At some point, it is going to tank, big time.

Gold won't tank until most people want it and start buying. The big buyers are the Asians (Chinese, Japanese and especially the Indians who collectively probably have over 20k tons), Central banks and those who are hedging against their paper currency (we're talking not just Americans but Australians and Europeans too).

At the present, most Americans don't own gold. There's no need to confiscate like FDR did in 1933. Besides getting far less than what they took in 1933, most Americans don't trust Washington and aren't likely to comply.

When the dollar dies, watch the mad scramble into tangibles with food, not gold, going first. Venezuela did it when they devalued their bolivars by 22% (6.3 dollars down to 4.3 dollars). There was a mad rush to the grocery stores as panicked people bought everything edible that they could.

Posted: 5/11/2013 12:28:16 PM EDT

[#41]

Quoted:
Because people will sell at less than the market price so they can afford to go to the Dollar store and have a real good time.

But no matter what you will never get out of anything what ya paid for it. No one will sell the $2k ring they bought for what they paid. And no one is gonna pay that price either. Look at all the CL ads for used jewelry. Even a decent coin shop isn't gonna pay spot for gold/silver coin or bullion. At best a coin shop will do 5% under spot. Even if you sell your 1oz gold eagles on eBay after fees you still didn't get spot.

Posted: 5/11/2013 12:29:29 PM EDT

[#42]

Quoted:

Quoted:
Because people will sell at less than the market price so they can afford to go to the Dollar store and have a real good time.

But no matter what you will never get out of anything what ya paid for it. No one will sell the $2k ring they bought for what they paid. And no one is gonna pay that price either. Look at all the CL ads for used jewelry. Even a decent coin shop isn't gonna pay spot for gold/silver coin or bullion. At best a coin shop will do 5% under spot. Even if you sell your 1oz gold eagles on eBay after fees you still didn't get spot.

No, they sometimes give you more. Check out Apmex and other online vendors.

Posted: 5/11/2013 12:34:38 PM EDT

[#43]

Quoted:

Quoted:
Because people will sell at less than the market price so they can afford to go to the Dollar store and have a real good time.

But no matter what you will never get out of anything what ya paid for it. No one will sell the $2k ring they bought for what they paid. And no one is gonna pay that price either. Look at all the CL ads for used jewelry. Even a decent coin shop isn't gonna pay spot for gold/silver coin or bullion. At best a coin shop will do 5% under spot. Even if you sell your 1oz gold eagles on eBay after fees you still didn't get spot.

No, they sometimes give you more. Check out Apmex and other online vendors.

They SELL over spot. They don't buy over spot. Even if the claim to pay over unless you have graded, MS70 (uncirculated) in a case they deduct for every scratch, ding, and imperfection. You aren't gonna get over spot

ETA: unless you have a double eagle $20 coin then ya might get a lil over spot

Posted: 5/11/2013 12:40:54 PM EDT

[#44]

My theory:

All the former strippers who became realtors during the housing bubble are too old to go back to the pole, so they are working for these pop up cash for gold joints servicing the current bubble. When the price crashes a bit more these places will blow away like tumbleweeds in the wind.

Posted: 5/11/2013 12:47:20 PM EDT

[#45]

Quoted:

Quoted:
Gold is at $1500/oz. You have a little 14k ring. You know nothing about karats, gold price or the weight of the ring, you just need cash and it's a ring you don't need. The store knows that it's 5 grams and is worth $140. They offer $75. You say "Oh, wow, this little thing is worth $75! Woohoo!" They make a 43% profit, and you're happy.

But this could have been done five, ten, or twenty years ago......but it wasn't.

With the price of gold at this level, a lot of people sell. The other side of that is that the spot price has hurt the jewelry business. The stuff is too expensive for a lot of people. A chain that used to cost $200 now costs $1,000. The price of gold is insane right now. At some point, it is going to tank, big time.

Gold won't tank until most people want it and start buying. The big buyers are the Asians (Chinese, Japanese and especially the Indians who collectively probably have over 20k tons), Central banks and those who are hedging against their paper currency (we're talking not just Americans but Australians and Europeans too).

At the present, most Americans don't own gold. There's no need to confiscate like FDR did in 1933. Besides getting far less than what they took in 1933, most Americans don't trust Washington and aren't likely to comply.

When the dollar dies, watch the mad scramble into tangibles with food, not gold, going first. Venezuela did it when they devalued their bolivars by 22% (6.3 dollars down to 4.3 dollars). There was a mad rush to the grocery stores as panicked people bought everything edible that they could.

Exactly.

With all of the big talk about gold, in reality, hardly anyone owns any. All this talk about bubbles and so forth is incorrect. It's not a bubble till most of the people you know are into it.

It's like a friend of mine said about the real estate bubble. He knew it was at its peak when he saw that they had made a TV show called Flip This House. That's when the party's over. Not before.

Posted: 5/11/2013 12:48:31 PM EDT

[#46]

Quoted:
My theory:

All the former strippers who became realtors during the housing bubble are too old to go back to the pole, so they are working for these pop up cash for gold joints servicing the current bubble. When the price crashes a bit more these places will blow away like tumbleweeds in the wind.

But.....are they too old to go back to the other pole?

Posted: 5/11/2013 12:49:12 PM EDT

[#47]

Quoted:

Quoted:
Gold is at $1500/oz. You have a little 14k ring. You know nothing about karats, gold price or the weight of the ring, you just need cash and it's a ring you don't need. The store knows that it's 5 grams and is worth $140. They offer $75. You say "Oh, wow, this little thing is worth $75! Woohoo!" They make a 43% profit, and you're happy.

But this could have been done five, ten, or twenty years ago......but it wasn't.

With the price of gold at this level, a lot of people sell. The other side of that is that the spot price has hurt the jewelry business. The stuff is too expensive for a lot of people. A chain that used to cost $200 now costs $1,000. The price of gold is insane right now. At some point, it is going to tank, big time.

Gold won't tank until most people want it and start buying. The big buyers are the Asians (Chinese, Japanese and especially the Indians who collectively probably have over 20k tons), Central banks and those who are hedging against their paper currency (we're talking not just Americans but Australians and Europeans too).

At the present, most Americans don't own gold. There's no need to confiscate like FDR did in 1933. Besides getting far less than what they took in 1933, most Americans don't trust Washington and aren't likely to comply.

When the dollar dies, watch the mad scramble into tangibles with food, not gold, going first. Venezuela did it when they devalued their bolivars by 22% (6.3 dollars down to 4.3 dollars). There was a mad rush to the grocery stores as panicked people bought everything edible that they could.

Exactly.

With all of the big talk about gold, in reality, hardly anyone owns any. All this talk about bubbles and so forth is incorrect. It's not a bubble till most of the people you know are into it.

It's like a friend of mine said about the real estate bubble. He knew it was at its peak when he saw that they had made a TV show called Flip This House. That's when the party's over. Not before.

Heard of a show called gold rush?

Posted: 5/11/2013 12:55:03 PM EDT

[#48]

FYI, prices rise when demand exceeds supply. When there are more sellers than buyers, meaning that no one wants it anymore, the price drops. The buyers are playing with it as an investment and buying it in quantity, rather than in jewelry. But, the economy is still stagnant all over the world. So who is ultimately going to buy this $1600 an ounce gold?

If the price stagnates and the economy improves, there will be a slow price decline.

If the price stagnates and the economy fails to improve, gold owners will start to sell. The price will decline, perhaps slowly, perhaps rapidly.

If the economy gets worse and some of the bulk investors are forced to sell, watch out.

Posted: 5/11/2013 12:58:49 PM EDT

[#49]

Because people have no idea what gold is worth. The average American doesn't have any clue what spot is or even how much a troy ounce is. The average American could have a kilo brick of gold and think they're making out like a bandit when someone pays them $5,000 for it.

Posted: 5/11/2013 1:00:03 PM EDT

[#50]

Quoted:

Quoted:
Gold is at $1500/oz. You have a little 14k ring. You know nothing about karats, gold price or the weight of the ring, you just need cash and it's a ring you don't need. The store knows that it's 5 grams and is worth $140. They offer $75. You say "Oh, wow, this little thing is worth $75! Woohoo!" They make a 43% profit, and you're happy.

But this could have been done five, ten, or twenty years ago......but it wasn't.

With the price of gold at this level, a lot of people sell. The other side of that is that the spot price has hurt the jewelry business. The stuff is too expensive for a lot of people. A chain that used to cost $200 now costs $1,000. The price of gold is insane right now. At some point, it is going to tank, big time.

Gold won't tank until most people want it and start buying. The big buyers are the Asians (Chinese, Japanese and especially the Indians who collectively probably have over 20k tons), Central banks and those who are hedging against their paper currency (we're talking not just Americans but Australians and Europeans too).

At the present, most Americans don't own gold. There's no need to confiscate like FDR did in 1933. Besides getting far less than what they took in 1933, most Americans don't trust Washington and aren't likely to comply.

When the dollar dies, watch the mad scramble into tangibles with food, not gold, going first. Venezuela did it when they devalued their bolivars by 22% (6.3 dollars down to 4.3 dollars). There was a mad rush to the grocery stores as panicked people bought everything edible that they could.

Exactly.

With all of the big talk about gold, in reality, hardly anyone owns any. All this talk about bubbles and so forth is incorrect. It's not a bubble till most of the people you know are into it.

It's like a friend of mine said about the real estate bubble. He knew it was at its peak when he saw that they had made a TV show called Flip This House. That's when the party's over. Not before.

Heard of a show called gold rush?

Ok, you got me on that one.

I still think that a bubble isn't possible till you and your neighbors are talking about and buying gold. Hedge fund and investment dudes too......and they're not.

[ARCHIVED THREAD] - Your theory as to why there are so many CASH 4 GOLD and WE BUY GOLD stores. (Page 2 of 3)

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