The price of gold reached record highs Monday as banking troubles spread throughout Europe and debt talks continue between President Barack Obama and House GOP leaders.
Gold rose for the tenth day in a row, jumping 0.8 percent to $1,602.40 an ounce. With the increase in gold’s price, business is booming for some local gold traders.
“People get more excited when it goes up and they want to sell it then when you get more money for it. Even people buying gold coins or bullion or investing in it in the future. It gets them excited and they want to buy it now before it goes up more,” said John Kennedy, co-owner of GB Gold Buyers, which operates a handful of stores across the Tri-Cities.
Gold has been rising steadily since the start of the month as the countries considered at the risk of default expanded beyond Greece to include Italy and the U.S. Traders have been buying gold as an alternative to holding dollars and euros as the debt problems in the U.S. and Europe undermine confidence in both countries.
As uncertainty in the dollar continues to grow and other countries face economic troubles, Kennedy said people are scared and believe investing in gold is a better option. However, Kennedy said most customers selling their gold now are more interested in getting extra cash for summer activities.
“Spring’s a little light, but when I get into summer, you got people traveling, you’ve got people using gas, you’ve got people wanting to go to the lake, so people are wanting a little extra spending money for what they want to do,” he said.
Whenever gold prices peak, Kennedy said there’s always a boost in people wanting to sell their gold and become more educated in looking to invest in the precious metal.
As the price of gold continues to fluctuate, other stores like Southern Bullion Coin & Jewelry, 2244 N. Roan St., Suite 103, haven’t seen much in the way of change over the last month.
“It’s hard to say, cause you can’t really judge what’s going to happen. You can expect a lot of people to come in, and then they don’t. And then on days when you don’t expect a lot of people, they tend to just pile in,” store manager Scott Baughn said.
Gold bullion and coins are typically what people purchase as they watch the price of gold stocks, Baughn said. Some customers have expressed their lack of faith in the economy as the reason behind investing in gold.
“People don’t know what’s going to happen with the economy and they’re worrying about the dollar collapsing, kind of going back to a gold and silver standard. There’s some people that hear the speculation that gold is going to go through the roof and they want to make a quick buck,” he said.
Like any market, Baughn said there’s always peaks and valleys. While gold is certainly higher than it was six or seven years ago, he said there’s no telling where it will be tomorrow.
“People are speculating that it’s going to go higher and buy it, causing it go up. When they realize it was driven up for that reason, it goes back down,” he said.
The Associated Press contributed to this report.