Investors Seek Stability in Coins

Gold prices have been on a roller coaster lately, and savvy investors have been following every climb and plunge. “We see the whole wave of people coming and going,” said Nick Hauser, owner of Hauser’s Coin Co. in Lakeland. “It’s been pretty active.”

Gold prices surged to a 26-year high last month at $732 an ounce as investors responded to inflationary worries expressed by the U.S. Federal Reserve, according to Bloomberg.

But in the weeks following, gold prices hit their longest slump in two years, falling about 16 percent.

“When (the spike) happened, it happened so quickly that a lot of people didn’t have the opportunity” to buy gold, Hauser said. “As the price has declined, we’re seeing more and more interest in it.”

Hauser, who deals in gold coins and bars, said he ran advertisements last month touting the elevated price of gold and saw an increase in people looking to sell. For longtime gold investors it was a good time to cash in, Hauser said, but now the prices have swung in favor of buyers betting on another rise.

Gold appeals to many investors because it is viewed as a hedge against inflation, weak currency and geopolitical instability. Concerns over inflation and rising energy prices helped to drive last month’s spike, and one analyst says those fears are likely to maintain high demand for gold.

“Everybody is increasingly aware of the extent that inflation is becoming a serious problem, so that will keep the demand for gold strong,” James Turk, founder of GoldMoney.com, told Bloomberg on Monday. “The underlying problems of growing federal budget deficits remain, as does the trade deficit.”

Gold prices also may rise as buyers snatch up the metal at its current two-month low in hopes of outperforming the sluggish stock market. Gold closed at $611.30 an ounce Monday, down $1.50.

But overall, recent shifts in prices has had a mixed impact on local businesses.

Alex Wold, manager of the Jewelery Corner in Lakeland, said the business has been paying about 20 percent more for gold items since prices went up, and has enjoyed a slight increase in customers.

“We’re always interested in buying it, it’s just that this is a good opportunity for people if they have some extra laying around and can make some money,” Wold said.

Customer traffic also has picked up at Hartman’s Rare Coin & Bullion in Winter Haven as buyers and sellers have taken notice of recent price fluctuations, owner David Hartman said.

But Sherry Oakley, co-owner of Oakley Jewelers in Lakeland, said that some customers have been reluctant to buy gold while prices are in flux – and she doesn’t blame them.

“I’m not stocking up on extra gold right now,” Oakley said. “I can buy it at a really high price but then it could fall back down.”

(via theledger.com)

Category - Informative
© 2018 CoinCollector.org