Market Insecurity Drives Gold Rush | NBC 6 South Florida

Market Insecurity Drives Gold Rush

A Weston cash-for-gold firm is seeing the effects of insecure investing



    (Published Tuesday, Aug. 9, 2011)

    The stock markets may be sinking, but gold prices are more than $1,700 an ounce -- an all-time high.

    For Steven Hansen, a national cash-for-gold buyer based in Weston, Friday's credit downgrade brought another spike in sales.

    "With each rise in the price of gold, we are seeing a 20 percent increase in sellers," he said of his company, Goldfellow. "Much of [the jewelry] is broken, damaged. We like to think we are helping them convert something of no value to something of use today."

    Hansen said when he started in the business, gold was selling at $400 an ounce. By comparison, a 12-ounce, 18 karat gold chalice Goldfellow bought in July for $11,600 is now worth $13,200.

    Economists, however, aren't so enthusiastic about the jump. They say when the price of gold soars to record levels, it's a sign of panic: investors turn to gold as a safe haven when other avenues of investment become unpredictable. 

    The gold rush made Andrea Gombosh head to a local gold buyer, curius about how much her old jewelry is worth.

    "I was just wondering how much I would be able to get for them, and that's why I'm here," she said.

    For those in the market, there's one question remaining: just how high will the price of gold go before it plummets back down below $1,000 an ounce.