Buying Gold - Retail - Can you say sticker shock!

[Iron Patch]

It's funny when you're on the profitable side of things something like the high price of gold a great thing, but recently
I've got the urge to replace a gold bracelet which I had outgrown many years ago. Back then it was a few hundred dollars, but now for something similar it's going to set me back about a grand! And I personally believe gold will drop again, so my $1,000 which gets me maybe a bit over $400 worth of gold, could easily end up being $200 worth of gold, or less. With that thought in mind it's pretty freakin hard to pull the trigger, and I'm the type that usually has a pretty itchy trigger finger for something I want.


In general this can't be a good thing for jewelers? Considering they're charging at least 50% for the craftsmanship of the piece a person would be much better moving 10 pieces with gold being low, then struggling to sell a couple at a very high rate. I've never thought much about this until now, but how can people in the jewelry business not be hurt for sales compared to back when gold was MUCH cheaper. I tell you, should it ever get down there again I'll buy whatever I want to buy, and be done with it for good. But I think if it drops it will drop slow because there will be a million others waiting, and buying along the way to help keep the price fairly solid. In other words, just tell me to buy the bracelet now.

 

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[Lost&Found]

My friend is a jeweler and has a retail store. Many of his pieces are consigned by the manufacture so he has a minimal outlay/investment. When the item sells his profit is what he get over the consigned price. He does not seem too concerned by the fluctuation in PM spot price. BTW he charges me by the gram not the craftsmanship.

 

[lonelyduckhunter]

Go ahead and buy the bracelet. It seems to me your mind is already made. You will find enough gold picking and detecting to make your cost cheap if not free look at it that way. My wife wants a bigger diamond and I have talked her out of it at least a dozen times in the last year.

 

[Iron Patch]

My friend is a jeweler and has a retail store. Many of his pieces are consigned by the manufacture so he has a minimal outlay/investment. When the item sells his profit is what he get over the consigned price. He does not seem too concerned by the fluctuation in PM spot price. BTW he charges me by the gram not the craftsmanship.

I wouldn't even debate it if I had that deal!

 

[Iron Patch]

Go ahead and buy the bracelet. It seems to me your mind is already made. You will find enough gold picking and detecting to make your cost cheap if not free look at it that way. My wife wants a bigger diamond and I have talked her out of it at least a dozen times in the last year.

If that is the justification I'm in trouble because it's where all my money comes from. You're right, it's on my brain so I might as well. I'm usually good at talking myself into things like this because it's not like drinking it away, but at the same time when I can see the value making it's way to $200 that's pretty close! I guess the way I'll look at it is if it ever gets so low it makes the bracelet worth very little, I can buy 5 more! So in a sense it's almost like taking a bet against yourself and still seeing a decent outcome even if you lose. There, I was able to talk myself into it.

 

[inspectorgadget]

If that is the justification I'm in trouble because it's where all my money comes from. You're right, it's on my brain so I might as well. I'm usually good at talking myself into things like this because it's not like drinking it away, but at the same time when I can see the value making it's way to $200 that's pretty close! I guess the way I'll look at it is if it ever gets so low it makes the bracelet worth very little, I can buy 5 more! So in a sense it's almost like taking a bet against yourself and still seeing a decent outcome even if you lose. There, I was able to talk myself into it.

If you follow the gold trend over the past 10 years it has risen to its highest record points about a year right before the presidential elections & then falls off for a few years after & then come a year or 2 before election time it rises again. If the trend holds true it will be at or above $1900 in another year or so. It only takes one big crises somewhere in the world to drive gold to crazy high prices. This is an old graph from almost a year ago but it shows the trend I'm talking about. The days of $1 per gallon of gas & $300 or under per ounce gold prices are long long gone!

 

[Nickleanddime]

Their not hurting ill say that. The one here in town is packed from July 4th on. Went to the mall day after Christmas and every jeweler was packed and a wait for help. Seems like the spike in gold made alot of new investors in metal jump on fine jewelry. They would rether have something they can wear every so often instead of a bar or coin in a safe. But they don't know like anyone who invest for long term knows the price will drop again. But it will someday go back up. As a barter item, it will be valuable in a "store" type setting. But from person to person food,ammo,shelter will be more powerful then that.

 

[MUD(S.W.A.T)]

Someone who buys and sells PM's his entire life as coin or jewelry told me.... He does not buy for long term investment. He just buys and sells as fast as he can. Moving as much PM's as he can... Since he is buying and selling no matter the spot price he still sells for a profit and he does not care about the spot price. He just cares about his markup ability... Sure the bracelet could go down, but it could stay up or go even higher to where you can't buy it at all. I'd get it while you can.

 

[conceptmachine]

yeah, gold is up there. I just bought my wife a gold charm bracelet. 1500+ the charms...which only bought 4 to start with and those totaled 900. LOL
I suppose its come down a little since a year ago. Then I bought some of those gold buffalo $50. pieces for my boys college fund. Ouch

 

[Iron Patch]

Someone who buys and sells PM's his entire life as coin or jewelry told me.... He does not buy for long term investment. He just buys and sells as fast as he can. Moving as much PM's as he can... Since he is buying and selling no matter the spot price he still sells for a profit and he does not care about the spot price. He just cares about his markup ability... Sure the bracelet could go down, but it could stay up or go even higher to where you can't buy it at all. I'd get it while you can.

It will almost certainly never go up for me unless gold hits the moon. You have to remember a new gold chain being sold on ebay is definitely not selling for just the gold content, the retail is a whole lot more. It's like a drug dealer buying an ounce of coke and cutting it to make 2 ounces... I'm the guy snorting the crap stuff from his 2 ounce pile. That's why to me it only makes sense retail has to get worse as gold goes up because it's a whole lot better to move as much as you can. They are making about 50% on the craftsmanship and non gold metal in the product, and there is likely a very minimal cost for that to them especially if they are doing a high volume. If I could buy a gold chain and only pay spot, I would not even have to give it a 2nd thought, but considering how it is, I see it as a loss because it almost certainly will be.

 

[inspectorgadget]

Dunno if its still the same now but before gold went thru the roof the Greek & India mall island type booths around here that sold gold chains, bracelets & charms sold them at a fraction over spot price. These were always marked 585 or 417 never 14K or 10K & again they were always foreign owned businesses. They killed all the real mall jewelry store prices on the same type items. I bought several items from these places in the late 90's & resold them in 05 on eBay & about doubled my money on em, if I had waited a few more years to sell Id have cleaned up! I also bought a very nice 48 gram 10K gold necklace from Kay Jewelers in 02 for like $600. I sold that in 2010 for $1250.

 

[Iron Patch]

Dunno if its still the same now but before gold went thru the roof the Greek & India mall island type booths around here that sold gold chains, bracelets & charms sold them at a fraction over spot price. These were always marked 585 or 417 never 14K or 10K & again they were always foreign owned businesses. They killed all the real mall jewelry store prices on the same type items. I bought several items from these places in the late 90's & resold them in 05 on eBay & about doubled my money on em, if I had waited a few more years to sell Id have cleaned up! I also bought a very nice 48 gram 10K gold necklace from Kay Jewelers in 02 for like $600. I sold that in 2010 for $1250.

yeah I also had a heavy 10k chain I bought low and did well on. I needed a little injection of cash on ebay, and am not really into the big thick gold chains anymore, so sold it. I actually prefer white gold now as it's a better match for my watches.... and if I'm going to complain about the price of a bracelet I sure as heck won't be buying a yellow gold watch anytime soon! If the gold goes up 2k on those the retail price probably jumps 10k!