All those investors hedging gold have spawned a hot new trend among home party merchants, gold buying parties.
Note the operative word buying, which apparently has housewives, jilted sweethearts, those experiencing tough times in a dour economy, and others who simply want dispose of unwanted or damaged gold jewelry scrambling to be invited to gold-buying gatherings.
January Thomas of Royal Oak, Michigan founded MyGoldParty.com last year after she married into a jewelry-retailing family and learned what she could get for her unwanted gold in the blazing hot 2008 precious metals prices.
Guests bring broken jewelry, painfully heavy gold bling from the 1980s, high school class rings, wedding rings from marriages past, or even a missing earring to party hostesses or hosts, who armed with a $700 kit containing gold sensor, a scale and a guidebook to separate real gold from its costume jewelry imitators.
Those forlorn, unloved pieces are inspected, weighed, purchased, and then sent to a smelter which transforms the jewelry into bars valued at $10,000 each, CBS News reported Tuesday, which will then be hoarded as a hedge against a wildly spiraling downturn in the international economy.
CBS reported that while 16.6 tons [their spelling, not Mineweb's] of gold bars were sold in 2007, that figure soared an incredible 368% to 77.8 tons [CBS News' calculations, not ours] in 2008.
Retail precious metals jewelers who are fed up with starving as their customers stopped buying gold pieces, now find themselves employing their skills in the more lucrative business of buying gold jewelry and selling it for smelting into physical gold.
USA Today reported last year that the professional gold scrapping sector is also booming as any consumer fed up with the buy-your-old-gold jewelry infomercials can attest. The largest online gold buyer, Gold4Cash.com, said its transactions increase monthly, thanks to the steady climb in gold prices.
As Cash4Gold Howard Mosshin told the news media last year, The economy is in the dumps, the housing market has hurt a lot of people, and people are looking for a way to find liquidity. Or, as one woman told CBS News Tuesday, her old jewelry is paying bills and paying the mortgage.
MyGoldParty's Thomas asserts that many women don't like going to pawn shops. At a party they're less embarrassed about asking how much their jewelry is worth. Besides, it's a form of recycling and de-cluttering. ABC News reported that 75% of the gold's actual worth is paid to party goers.
The Washington Post has reported that Washington D.C. gold party goers (including lobbyists and diplomats) part with forgotten treasures from international trips. There are the dentures of deceased relatives, framed in gold, unwrapped discreetly for an estimate, the Post noted.
And, the Post observed, the husbands come with their wives. Everybody has a little gold they don't know what to do with.
Others sell their gold for more altruistic reasons such as for cancer research or other charities.
TIME columnist Joel Stein declared that he did not want to sell his gold chain at some seedy pawnshop or through an infomercial company. It turns out a lot of people feel the same way. Stein sent his money to January Thomas for a kit with a jeweler's loupe, a scale and a machine that tests how many karat a piece of gold has.
I have not felt so Jewish since my Bar Mitzvah, he quipped.
When my friend Duncan gave me his confirmation pendant with an engraving of the Virgin Mary, I look at it through my loupe and offered him $210. He was greatly impressed, Stein recalled. But even amid the recession, Duncan took his necklace back, happier with it than he'd ever been.
Has Mineweb failed to mention the gold party potential for surviving children of parents who were addicted to QVC jewelry buying sprees?
Somewhere, we hear the siren song of a long forgotten high school class ring beckoning us to champagne wishes and caviar dreams....
Seriously, how about trading in the ring for a beer and a can of tuna fish?