Consumer Editor Emma McKinney discovers how rogues are ripping off Brummies as the rise in the price of gold sees many cashing in their jewellery.
WITH the value of precious metal soaring, many cash-strapped people are rooting through their jewellery boxes to find old gold in a bid to raise much-needed money.
In fact, some are even going to extreme measures, with South Koreans reportedly selling their gold teeth to take advantage of the price breaking through the $1,500/oz barrier.
With stock markets remaining volatile, house prices continuing to fall and interest rates on savings accounts staying dismally low, selling and buying gold is fast becoming the most popular way to boost incomes and generate pension pots. Perhaps not surprisingly, traders in Birmingham’s Jewellery Quarter – the biggest gold and bullion market in Britain – say they have been doing brisk business.
Today, the quarter, which began working precious metals in the 14th century, is believed to be buying around £20 million worth of gold each week – ten times the quantity of a few years ago. But the dealers could sell even more, according to Nigel Blackburn, chairman of Lois Jewellery Ltd, in Hockley’s Frederick Street. “The demand for gold from China and India is insatiable,” he says. “But not just from the Far East. In the UK, too, some people are selling everything and buying gold.
“We have people turning up asking for £500,000 worth of gold Krugerrands, saying they had decided to cash in their pension and feel safer with their money in the South African gold coins.”
He said besides regular consumers, jewellery retailers are also going to the quarter to sell the gold they have taken in from customers on the high street.
“We deal with the public no matter how small their offering, but my typical customer will be here selling gold worth £250,000 or more because they are local high street jewellers,” he adds.
“They have bought this gold from their customers and they come here to sell it on and make their margin.”
Dealers such as Mr Blackburn melt the gold down, usually on the premises, and sell it the next morning as bullion on the London market.
Like any other investment, gold prices can go down as well as up, though gold is seen as a safe haven in times of trouble. Given international uncertainties, few are yet ready to call time on the gold run.
Mr Blackburn adds: “We aren’t carrying any risk. All our trades are back-to-back. We buy to meet orders, and right now we can’t buy enough to meet the demand.”
Demand is so high it has spawned a new breed of companies selling cash for gold, many of which operate high-profile TV advertising campaigns.
