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

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    NEWSLETTERS

    The stock market may be heading in the opposite direction, but the price of gold is skyrocketing. (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.