Local jewelers will wait to adjust for gold's record increase

As if the housing crisis and increasing gas prices aren't enough bad news, now the price of gold has passed $1,000 per ounce for the first time ever.

What it means for consumers is that the price of your Mother's and Father's Day presents won't necessarily increase, but next Christmas and Valentine's Day may be a different story.

Local jewelers say they have inventory that was purchased at lower prices, so they'll hesitate to raise prices and risk losing to the competition. When current inventory runs low, though, the business owners will have to buy at higher costs.

But local jewelers say gold isn't an anomaly. Instead, it's just another sign of a recession.

"I have a customer who's a real estate agent, and she hasn't sold a house since November," said Dan Ingrum, owner of Danz Jewelers, 220 S. School St.

In other words, the housing price drop and the crude oil price increase, along with the gold hike, are all part of a bigger picture.

"As soon as interest rates get better and the housing market improves, the price of gold will drop," said James Blum, owner of Blum Jewelers in Lakewood Mall on Ham Lane.

Blum remembers gold prices jumping in the 1980s and everybody panicking. The Lodi jewelry stores are still open, so customers obviously recovered from their worries and began buying again.

And new jewelry isn't the only thing people purchase at such stores.

Dan Ingrum, owner of Danz Jewelers, places diamonds in a gold and diamond bracelet Friday at his store in Lodi. (Brian Feulner/News-Sentinel)

Ingrum sees a lot of customers who bring in old jewelry to have the gold melted down and fashioned into a new piece using the original jewels. Not only do the customers avoid paying for new gems and expensive new gold, but they also keep the jewels that are often family heirlooms.

For those who have old gold jewelry, aren't interested in remaking it and need the money, now is probably a good time to sell it. Hanh Le, owner of Lodi Jewelry Repair, 728 W. Lodi Ave., doesn't buy much jewelry, but when an older woman entered his shop Friday morning, he didn't turn her down.

"Time is tough now, so even a dollar helps," said Le, a 17-year jeweler who has run the Lodi Avenue store for about two years.

Historic gold prices per ounce

1955: $35.15
1960: $36.50
1970: $38.90
1975: $139.29
1980: $594.90
1985: $327
1990: $386.20
1995: $387
2000: $279.11
2005: $444.74

— Source: goldinfo.net, run by Yahoo.com

Reader Feedback

wtf wrote on Mar 17, 2008 8:33 AM:

" I personally consider gold like a bookmark; a bookmark "holds your place" in a book and gold holds its value in the market.

Ron Paul says that "holding gold" as an investment is similar to "holding $100 bills under your mattress" - neither collects interest; however, the dollar can (and currently is) be devalued while gold holds its value i.e., purchasing power. "

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wtf wrote on Mar 17, 2008 8:31 AM:

" Cogito if you could over your prejudice about Ron Paul, you would see that he does *not* advocate "investing" in gold.

If you read the article by him, he said, "...buying gold per se should not be touted as a good investment. After all, gold earns no interest and its quality never changes. It�s static, and does not grow as sound investments should."

He goes on to say that gold holds it's value. If you had gold now and sold it while at $1,000+ an ounce, it would buy the same amount as it did at $325 an ounce. "

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Cogito wrote on Mar 17, 2008 12:34 AM:

" The last time gold skyrocketed was when Carter was President, and we know what happened to the economy then. Out of control inflation, gas lines, and the worst economy of my 50 years as an American. But we recovered and Gold became one of the worst investments you could have made in the last 30 plus years. Don't believe the naysayers and their economic ignorance. Gold is a bad investment, and usually is. "

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wtf wrote on Mar 16, 2008 9:20 PM:

" The increase in the price of gold is tied to what is happening in the financial world.

Asia Stocks, U.S. Futures, Dollar Decline After Fed Cuts Rate

http://www.bloomberg.com/apps/news?pid=20601087&sid=ae5jTiBwIyVA&refer=home

JPMorgan Acts to Buy Ailing Bear Stearns at Huge Discount

http://www.nytimes.com/2008/03/16/business/16cnd-bear.html?_r=2&adxnnl=1&oref=slogin&ref=business&adxnnlx=1205727275-Kg0+M4YI60Cp/RcjUDqDKA

Asian, Australian Markets Open Down

http://money.cnn.com/data/world_markets/? "

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wtf wrote on Mar 16, 2008 12:09 PM:

" This article is the flip-side regarding the dollar and debt slavery:

Today We're All Irish: Debt Serfdom Comes to America

The link is out of Canada and you have to type in the title to find the article. It's at the website called Global Research. "

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wtf wrote on Mar 16, 2008 12:06 PM:

" This article ties in as well regarding the housing bubble:

Is Suburbia Turning Into Slumburbia?

http://www.sfgate.com/cgi-bin/article.cgi?f=/g/a/2008/03/14/carollloyd.DTL "

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wtf wrote on Mar 16, 2008 12:05 PM:

" Ron Paul has an interesting take on why the price of gold is sky-rocketing.

What the Price of Gold Is Telling Us

http://www.lewrockwell.com/paul/paul445.html

To supplement the above, check out the dollar chart and the gold chart.

http://futures.tradingcharts.com/chart/US/W

http://futures.tradingcharts.com/chart/GD/W
"

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