When Is the Right Time to Buy or Sell Your Gold?

“One day, this is going to be worth fortune”. How many can attest to saying this at least once in their lifetime about an item that came into their possession? As many people collect different kinds of items (some for hobbies), many collect with the hopes of the object gaining value so that they may re-sell the item for a higher price at a later date.

Items such as jewelry, or gold specifically, are more popular when selling back to stores or buyers for a profit. As gold is profitable and weighed more heavily depending on the geographical area, it is seen as a valued item for trade and sales, hence the many different pawn shops and locations across the nation. Though when is the best time to do so? When selling back your gold, the objective is to make the best possible profit from its original value when it first came into your possession. How can you make sure this happens?  

Statistics show (and it helps if you are an investor) that it is key is to look when the Dow Jones gold price ratio is between 1 and 2. Also keep an eye on the gold to silver ratio. Gold must be sold at a higher price than silver in order to be viewed as more valuable, so make sure the ratio is always in gold’s favor. Another tip for those who keep a close eye on the economy is to sell is when inflationary policies are at a standstill, although nowadays this is almost never the case.  Keep in mind that when selling gold for a profit, take a look and examine your personal and financial perspective. As mentioned earlier, the best time to sell is when inflationary policies are at a standstill.

Although this has not been the case in decades, it is important to sell back your gold and make a profit when you personally see fit. As the market prices will continue to go up and items will continue to lose their value, what may hold financial value today may lose its value and decrease tomorrow. If you have a mortgage payment or stock investment you need quick cash to meet, it is best advised to take the opportunity and sell as soon as possible as the economy is going up by the minute!

Key Components in Fluctuating Gold Prices

The key components of fluctuating gold prices include many factors and variables. When people start to lose confidence in their government or in the financial market, gold prices often rise, which is why gold is usually referred to as a crisis commodity. A global crisis or world events can also have an impact on gold prices as it is seen as a safety net when the economy is rocky. Inflation is another reason for the fluctuation of gold prices as the actual value of what gold can buy is more likely to stay stable in the long run even though currency values may fluctuate.

Gold is a solid investment to make as it is low-risk and will stay valuable when paper currency value declines. The value of the dollar along with central bank instability are also factors contributing to fluctuating gold prices. When the U.S. dollar is strong, selling gold may be more difficult, but it can also be seen as an opportunity to buy. This is also seen with central banks as some investors may want the security of having physical gold rather than relying on the bank, increasing the value of gold as well and further validating the term “crisis commodity.”

Interest rates also play into the fluctuating gold prices as current gold prices are reflected by the increases and decreases in interest rates. Lower interest rates means a higher attraction to gold. Although gold can be seen as a crisis commodity and safe investment, it is also very valuable for jewelers and other certain industries. More than half of the demand for gold comes from jewelry and another 12% of the demand for gold is generated from industrial applications. Gold is used by manufacturers in various devices such as electronics, computers, GPS systems, and medical devices. There will always be a need for gold, which will cause the price to fluctuate frequently, but it will still be an important staple in the economy.

Precious Stones

Precious stones, also called gemstones, are mineral pieces cut and polished for use in jewelry and other types of ornamentations. Gemstones are classified by their hardness, translucency, and color, and their value is dependant on these factors as well as how common or rare the mineral may be. Gemstones are formed below the earth’s surface and their characteristics usually develop when interacting with water and other rocks and minerals around them.

Rarity as well as supply and demand are the main driving forces behind the prices of gemstones. Gems are characterized by gemologists based on their chemical composition, crystal structure (e.g.: cubic, hexagonal, monoclinic) and optical characteristics as well as their hardness (using the Moh’s Hardness Scale). The precious stones are diamond, ruby, sapphire, emerald, opal, and pearl, and differ in price and rarity from semi-precious stones such as garnet.

Buying gemstones can be difficult because, unlike diamonds, no official system of grading is used. The most common way of determining value has been by eye using the four C’s (Color, Clarity, Cut, and Carat), and because of this, it pays to only go to a reputable dealer so you do not buy fake or synthetic gemstones. The Coin Galleries of Oyster Bay has reputable dealers and sellers who know the true value of gemstones and are easily able to tell a fake.

It is important to set parameters and do your research before going out to buy any jewelry or accessories containing precious stones. Price point should be your main concern as gemstones can range wildly depending on their characteristics and rarity. Color is usually one of the main characteristics people seek out when looking for gemstones and you can narrow down your search if you know what you are specifically looking for. Come down to the Coin Galleries of Oyster Bay and have one of our reputable dealers help you pick out the perfect gemstone!

History of Gold in the U.S.

Gold is considered one of the most valuable precious metals and has been praised around the world for centuries. In the United States, we first started seeing and using gold in the 1500’s, and the “gold standard” was set in the late 1700’s and remained the same until 1934. Between the end of the American Revolution and 1823, the United States purchased 20 million dollars worth of gold. Spanish soldiers were using gold as a means of barter in California around 1824 and the buying price for gold rose in 1837.

In 1842, the gold rush saw its beginning when Francisco Lopez stopped for a rest in San Feliciano Canyon and dug up onions to eat. In the roots of the onions, he found particles of gold and discovered gold deposits nearby as well. Locals came in search of gold and within the year, experienced miners had been coming from Mexico in order to extract the gold for profit. Excitement over the gold had not been generated as there was not a lot of publicity regarding the gold. In 1848, gold was discovered on the South Fork of the American River and it was intended to be kept a secret, but in March, the newspaper The Californian published an article about it. With this article, the news of the discovery of gold became known worldwide and led to the beginning of the Californian Gold Rush.

By 1852, the amount of people that were engaged in mining had gone from 4,000 to roughly 100,000 and had stayed that way for a few years. The Gold Reserve Act had been put in place after the Great Depression in order to encourage people to spend their money to improve the economy rather than hoard it and damage the economy further. Throughout the following years, the price of gold had increased with the economy and in more recent years, it has reached an all time high price, showing the true value and importance of gold in the United States today.