Gold’s wild price fluctuations haven’t fazed many Charlotte-area jewelry retailers.
A day after the precious metal’s biggest one-day price decline in 33 years, store managers said they hadn’t seen much of a reaction at all.
“When gold (prices) start dropping, I don’t notice a bunch of people running in and saying, ‘Should I sell?’ ” says Brian Filer, store manager of Perry’s Fine Antique and Estate Jewelry in SouthPark, a gold buyer and retailer.
The price of gold soared as high as $1,900 an ounce in 2011, sending consumers pouring into stores to cash in old jewelry and coins. On Tuesday it stood at $1,386, a gain of $26 from Monday’s dramatic fall.
Analysts say gold’s slump into a bear market is due to an array of factors, from the financial woes of China and Cyprus to recent signals by the Federal Reserve that the U.S. monetary stimulus may be scaled back this year. Gold is seen as a hedge against inflation, but fears of inflation are easing.
Yet the decline hasn’t yet played out locally, as retailers say most people bringing in a handful of tangled gold chains and mismatched earrings to sell, aren’t keeping up with daily fluctuations. And the price is still higher than seven or eight years ago.
Occasionally, Perry’s will see a small spike or decline about a week after a major gold announcement, Filer said. But those changes usually level off within a week.
“There’s no rhyme or reason,” says Filer. “There’s a percentage of people (for whom) this was just their day off, … the day they planned on (selling), and it doesn’t have anything to do with the gold market.”
But in general, the traffic of people interested in selling their gold is steady. Perry’s has six full-time buyers present at all times, and Filer says the store has had days when it bought $100,000 in gold, and months where it bought $1 million worth.
Brownlee Jewelers on Park Road still sees a stream of 20 to 30 hopefuls a day, said store manager Michelle Pavlakos.
And there is no typical seller profile, she says. Some may just be looking to de-clutter. Others may be financially strapped and need quick cash for a mortgage payment.
“Or we may have an old woman who has so much jewelry she’s tired of and she wants to redecorate her kitchen,” says Pavlakos.
But what sellers are always concerned about is getting the most bang for their buck, retailers say. Brownlee and Perry’s both offer 85 to 95 percent of gold’s market value to their sellers, depending on the quality of the items.
The unpredictable gold market is why Donald Haack Diamonds doesn’t generally buy gold from the public, says graduate gemologist Scott Falconer.
As the SouthPark retailer’s name suggests, Donald Haack focuses on diamond-buying.
Their one exception, Falconer says, is fine vintage gold pieces that are marketable. But that’s not what most retailers are appraising when someone brings in a stack of gold jewelry to sell, he says.
“What everyone is buying are class rings, gold chains, a half pair of earrings or sterling silver that’s broken or dented,” said Falconer. “Unless you’re doing an awful lot of volume, it doesn’t pay my salary.”
What those small sales are good for, however, is getting traffic flow and building a relationship with potential customers. “We want to keep their good faith,” said Pavlakos. The Associated Press contributed.
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