FORT WORTH (CBSDFW.COM) – Michael Meyers opened two yellow envelopes Tuesday and poured out a tangle of necklaces, rings and bracelets. It was $3,000 to $4,000 of gold he bought, from just two sellers.
He could buy as much as $25,000 worth before the end of the month.
“The higher it goes the more people we get coming in, and not only,” the gold-buyer said, interrupted by a man bringing in a ring.
Gold prices are so high – $1,743 dollars an ounce – he says gold owners almost can’t afford to keep it just sitting at home.
He was previously able to pay about 50 percent of full value to buy it – now the business is so competitive, sellers are getting as much as 90 percent of the value of the gold’s weight.
“We’re definitely seeing a more affluent customer come in,” he said. “We’re seeing stuff like Tiffany’s and Rolexes.”
Gold is worth so much that there’s very little being resold inside the jewelry cases at the store.
People can’t afford the high prices and shops can actually make more money selling it for scrap.
As sure as selling is, economists say buying gold as investment may not be a safe escape from the up-and-down stock market.
“There’s no reason for it, in and of itself, to be safe,” said TCU economist Peter Locke. “It doesn’t have as much use, for instance, as silver.”
Metals that have an actual use in construction like aluminum, copper and nickel have moved less than four percent or even dropped in value, while gold has climbed 16 percent.
Its value is tied to emotion, experts say, and as surely as it went up, its price will likely go back down.
“It’s just a fear factor,” Locke said. “It’s always been that way. It’s been that way as long as we’ve been trading gold.”
Gold may still have some room to grow –it would have to get close to $2,300 an ounce to match its inflation-adjusted peak, which it hit in 1980.