JCK’s Ultimate Guide to Gold

Gold is found in much more than just jewelry and watches. it’s used in electronics, water and air purification systems, effective cancer treatments, and even home pregnancy tests.

Thanks to David Schraeder, spokesman for the World Gold Council, I got a crash course in all things gold this past week. I wanted to pass along some of the things I learned as part of this compilation of JCK’s coverage of the gold market.

Cool Facts About Gold:

  • Gold has two sources of supply: mining and recycled gold.
  • Mining gold has decreased of late owing to the fact that all the “easy gold” has been mined and exploration budgets to find more are going to be much more expensive. Even if a new find was discovered, it would take 5–10 years for that gold to reach the market.
  • According to the WGC’s website, recycled gold ensures that there is “potential source of easily traded supply when needed.” As long as the metal is in a form that can be melted down, refined, and reused, it helps keep prices stable and avoid economic volatility. According to the WGC, recycled gold contributed an average 32 percent to annual supply flows between 2005 and 2009.
  • Four components to gold demand: jewelry, investment, technology, and central banks.
  • Central banks were once a source of supply. Once Europe and the United States abandoned the gold standard, the banks started selling stocks of gold that had been sitting in vaults. Since 1999, Central Bank Gold Agreements have regulated bulk sales of gold from the world’s biggest holders of gold. The agreements eradicated the fear of unlimited selling that drove prices down and led to more stability in the market. According to the WGC, net central bank sales amounted to just 41 tons in 2009. “How many times has a source of supply become a source of demand,” Schraeder asks.
  • Between 400 and 500 tons of gold a year are in technology. Along with the uses I mentioned early, it is also employed extensively in dentistry, although Schraeder tells me that practice has dropped off slightly in recent years.
  • There has been a shift in gold demand from the West to the East.
  • China and India combine to make up 50 percent of the global demand for gold. The United States and the rest of North America make up just 13 percent of global demand.
  • Women in India possess upward of 18,000 tons of gold—mainly because of India’s culture of giving gifts to women after marriage or during holidays like Diwali. To put that number is perspective, total U.S. holdings equal 8,133.5 tons.
  • In 2004, the Chinese government made it legal to buy gold. Gold appealed to the Chinese because of their suspicion of the stock market. “Gold is also simple,” says Schraeder. “People can understand what it is and can store it.”
  • Schraeder also tells me that jewelry stores are mob scenes in China. During a trip to Beijing last spring, he was floored by the activity in the store that he visited. “It looked more like a bar in the meatpacking district of New York City,” he says. He says people were lined up at the counter shoulder-to-shoulder and that there were at least 100 attendants working throughout the store.

 

Top 10 Gold Stories From 2011:

  1. Bank Predicts Gold Price Will Triple
  2. Talk of Gold Bubble Grows
  3. Execs Think Gold Price Will Hit Record in 2012
  4. Gold Price Sees Biggest Slide in Decades
  5. Gold Predicted to Hit $1,900, Reaches New Record
  6. Gold Price Topping Platinum’s
  7. Gold Price Hinges on Debt Crisis, Hits New Record
  8. Banks: Gold Expected to Hit $2,000
  9. Leading Gold Dealer Goldline International Charged With Fraud
  10. Gold Now Considerably More Expensive Than Platinum

Other Popular Stories on Gold Prices:

Coverage of Conflict Gold:

Gold Fashion:


Private: JCK’s Ultimate Guide to Gold



Gold Prices:

How to Navigate the Modern-Day Gold-Buying Market
Over the past couple of years, soaring gold prices have inspired many retail jewelers to reclaim their gold-buying heritage.

Gold Crush
The cost of the gleaming yellow metal may be at all-time highs, but jewelers who can stifle their own sticker shock and sell the aesthetic appeal of gold jewelry can turn a tire kicker into a collector.

Gold Price Sinks Below $1,600
Gold experienced its biggest plunge in decades on Sept. 26, temporarily sinking below $1,600 an ounce, an over 15 percent fall.

Gold Hits New Record Over $1,900, Again Tops Platinum
On Sept. 6, the spot price of gold soared past the $1,900 barrier on Sept. 6, at one point hitting $1,920, a new record.

Talk of Gold Bubble Grows
As the price of gold has soared over the last few weeks, debate in the financial community has increased over whether the metal is exhibiting the signs of a bubble.

U.S. Gold Jewelry Sales Falling as Metal Price Soars
As the spot price of gold hit yet another record on Aug. 18, the World Gold Council acknowledged that gold jewelry sales in the United States fell sharply in the second quarter of 2011.

Banks: Gold Expected to Hit $2,000
With the price of gold continuing to soar—after a third record a day in a row on Aug. 10–world banks are revising upwards their predictions about gold.

Gold Price Topping Platinum’s
As gold has continued its incredible rise, its price has on occasion topped that of its traditionally more expensive sister metal, platinum.

Gold Price Hinges on Debt Crisis, Hits New Record
As the gold price hit yet another record on July 29, the metal’s short-term direction may depend on the resolution of the U.S. debt crisis, analysts tell JCK.

Gold Predicted to Hit $1,900, Reaches New Record
The head of the one of the world’s largest currency funds predicted gold will hit $1,900 an ounce by later this year, in an July 20 interview with Bloomberg.

WGC: Gold Outperformed Other Assets
Gold outperformed most major assets, including commodities, throughout the second quarter of 2011, the World Gold Council announced July 14.

Bank Predicts Gold Price Will Triple
The gold price will keep rising and possibly approach $5,000 an ounce in the next decade, according to a new report, “In Gold We Trust,” published June 14 by Standard Chartered Bank.

Report: U.S. Gold Jewelry Demand Falls 10%
The high gold price has hurt demand for gold jewelry in the United States, according to the World Gold Council’s Gold Demand Trends report for the first quarter of 2011, which was released May 19.

Gold Smashes $1,500 Barrier
The gold price soared past the $1,500 an ounce benchmark on April 19, a new record in a year already filled with them.

Investors Still Confident in Gold
The World Gold Council released its first quarter 2011 findings in Gold Investment Digest April 27, noting positive investor sentiment toward gold and greater confidence in the timing of jewelry purchases contributed to a strong quarterly performance.

Gold, Silver Hit New Highs
The gold price hit a new record of $1,475 an ounce on April 8, leading analysts to debate if it will soon hit the $1,500 mark.

Gold, Diamonds Saw Sales and Price Gains in 2010
The gold and diamond sectors experienced sales and price increases in 2010, according to De Beers and the World Gold Council.

Gold Price Jumped 29% in 2010
The gold price rose for the 10th consecutive year in 2010, according to the World Gold Council.

Americans Have $140 Billion in Unused Gold and Jewelry: Survey
Consumers in the U.S. believe there is approximately $140 billion in gold and jewelry that they do not wear, or approximately $604 worth of unworn gold and jewelry per adult, according to a survey conducted by TNS Global Market Research.

“Gold Rush” Raging On, Retailers Say
With the price of gold continuing to set records, retailers say they aren’t seeing any drop in the number of gold trade-ins.

Conflict Gold:

 

The Ethics of Gold

 

 

 

World Gold Council Announces Conflict Gold Standard
The World Gold Council announced June 17 that it had produced a draft of standards designed to combat conflict gold.

 

JCK Las Vegas: Conflict Gold Becoming Major Issue, Speakers Say
The new legislation on “conflict minerals” will have a major impact on the gold and tungsten markets, Jewelers Vigilance Committee president and CEO Cecilia Gardner said in a seminar on the topic at the JCK Las Vegas show June 2.

SEC Wants Conflict Gold Reporting Requirements
Publicly held jewelry manufacturing companies could now have to regularly report if their products contain conflict gold from war-torn areas of the Democratic Republic of Congo or adjoining countries, according to new rules proposed by Securities and Exchange Commission regulators Dec. 15.

From the Gold Vault in JCK magazine:

Arkansas’ Festive Red, White and Blue Celebration

Heather B. Moore Charms Us; Katy Briscoe Branches Out

Carelle Pays Tribute to Brooke Tivol McGrath

Terry Whyte’s Local Design Contest, Pascale Bruni’s Le Joli Monde Line

Borgezie Shoes, Frey Wille Boutiques

Turning Your Old Jewelry Into New Custom Designs

CIRCA Jewelry Buying & More