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A small report from the front in the gold war
12:01p ET Sunday, November 1, 2009
Dear Friend of GATA and Gold:
The New York Times story appended here, an account by the newspaper's City Critic, Ariel Kaminer, of her visits to gold recycling shops in Manhattan, may be a small but telling report from the front in the gold war, where the public is selling, not buying, and jewelry demand is transforming into investment demand whose origin is not quite as visible. The underlying message may be that gold is still money, and, increasingly, a better sort of money.
CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.
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Cashing in Memories, at $1,000 an Ounce
By Ariel Kaminer
The New York Times
Sunday, November 1, 2009
The corkscrew earrings I got for my 16th birthday felt way too '80s to wear, but I still liked to look at them sometimes. As for the dome-shaped ring with the ripple running over it, my mother couldn't figure out how to wear it, so she gave it to me to try. Could I really trade these things for a pile of twenties?
What about the bracelet that friends of my parents gave me for my bat mitzvah, thrillingly ensconced in a red Cartier box? Or the earrings my grandfather made at his shop on the Lower East Side?
OK, this array of gold jewelry was not really mine, but the story behind each piece was real for somebody. Over the last year, as the price for gold has risen -- it is now above $1,000 an ounce, an all-time high -- countless people have gone rummaging around their dresser drawers for those old trinkets from Aunt Bertha. They've asked themselves some hard questions: What is the exchange rate for sentimental value? At what price does it make sense to open the jewelry box and let the treasures go?
Alas, I have no gold -- and, on closer inspection, no Aunt Bertha. Some colleagues, however, had some old baubles, so I stuffed them in a Tiffany & Co. felt bag and headed off to the diamond district to sell memories by the ounce.
Decorated with purple orchids, a crystal chandelier and wooden display cases full of sparkly rocks, Diamond Scene, at 9 West 47th St., is an elegant departure from many of its neighbors. "You don't know how lucky you are," one of the guys behind the counter said with great excitement as Moein Afshar, a reserved man with an understated manicure, looked over my offerings. "He's been in this business 40 years!"
Mr. Afshar scratched each piece against a black stone, then tested the mark it left with acid to determine its purity. Next he weighed them all: the two pairs of earrings, the Cartier bracelet, the dome-shaped ring, along with a locket somebody's wife inherited from her mother and a hoop earring that long ago lost its mate. Finally, he gave me a number: $931.60.
Premier Polishing & Contractor USA is just down the block at 29 West 47th St. but feels miles away: Instead of a tastefully appointed boutique, it's an undecorated 8-foot-by-8-foot box, which on that day the young Garen Kilerciyan was sharing with his father. His hands stained yellow from the acids, he performed the same tests on the same six pieces and offered $852.
The National Jewelers Exchange, across the street at 4 West 47 St., makes even that glass box seem upscale. It is a warren of mismatched stalls and cluttered displays staffed by men with black hats and long gray beards, and women wearing modest wigs and proud diamonds.
Standing over a shelf of tangled chains and a lone Krugerrand, goggles perched atop his forehead, David Tal, at Booth 65, inspected my pieces, then waved them away: "There's nothing here that interests me." To make the insult perfectly clear, he said the most interesting thing I had was the felt pouch.
I had the feeling that his real objection was to the notes I was scribbling, so I asked: Was he aware that the bracelet was from Cartier?
He scoffed, he rolled his eyes at a friend, and he looked more closely. After a good long while, he allowed that it was, indeed, from Cartier. But he still sent me on my way.
On the other side of the exchange, the men at E.I. Watches took just a few moments to come up with a figure: $725. I told them I'd gotten much higher offers. So take them, they said, in a way that made it clear the conversation was over.
I was starting to feel extremely unwelcome. Were we not all human beings, caught in the same struggle between the love of beauty and need for survival? Had we not all partaken of the same blintzes at the same linoleum-clad luncheonette one flight up?
Out on the street, guys wearing sandwich boards and handing out "We Buy Gold" fliers were blocking my way. Arto Can, an elegantly dressed jeweler with an open shirt and a lit cigarette, shook his head in disgust. "They kill the 47th Street, people like this," he said. "Where is the quality in these people?" Then he walked me inside to his carefully appointed display counter and offered $890. I had made $165 by just crossing the street.
The five appraisers also had five opinions about the purity of this or that item. In search of a final verdict, I visited Jeff Levin, the chairman of the 47th Street Business Improvement District. He does not buy gold, but he takes it upon himself to educate consumers. He said my cache was worth $874.76, and that I should not accept much less. I told him I had been offered $55 more.
"Whoever gave you that price made a very big mistake," Mr. Levin said, "and you should grab your money."
So I did. (Not all my friends were ready to sell, but the corkscrew earrings, the lone hoop and the ring fetched $268.80.)
It was a little sobering to see beloved keepsakes reduced to ounces and dollars. Of course, $62.41 for an unmatched earring is basically free money. But an offer of $210 for a Cartier bracelet my colleague estimates to have cost $1,500? And what about the other measure of value -- her memory of the red box it came in, and of the glamorous friends who gave such a generous gift?
On my way out of the diamond district, I knocked on the door at Ross Precious Metals, one of the bigger refiners, to see what fate awaited the items I sold. Dumping a small tray onto the table, Jamie Ross showed me the kind of stuff that comes through his front door -- bracelets, chains and what looked like chewed gum: dental fillings. They all go into a refiner in the back room, where they are melted and poured into bar-shaped molds.
Holding one of those bars, I thought about all the trinkets that must have gone into it, and all the feeling that had attached itself to them.
But that bond is stable only up to 1,947 degrees Fahrenheit. After that, all those souvenirs and birthday gifts might just as well have been dental fillings.
An unsentimental ending, I suggested. "It's an unsentimental business," Mr. Ross said with a shrug. Unsentimental, and unglamorous. But for the moment, at least, highly profitable.
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