Decades ago, my mother and father took a cruise still popular for travelers today – a voyage along the coast of Alaska. Naturally, lots to see there. As with most tourist trips, the ship stopped at various points for day outings ending at designated shops and stores.
With Alaska being renowned for the Klondike gold rush of 1894 to 1907, much of the souvenir jewelry was made from the precious metal. As a rare treat, my father purchased my mom a small glass pendant about the size of a nickel. The inside was filled with small grains of gold mined from the region over the years. With gold then valued at about $100 an ounce, they splurged on the keepsake probably spending $75 or so. It was an interesting curiosity with a good story but eventually relegated to mom’s “costume jewelry” box....
Fast forward to 2026. Last week, gold climbed to an unheard of $5,500 an ounce. My mom’s memento would now probably be worth somewhere near $1,000, assuming we could even sell it. Amazingly, that’s doubtful right now.
My skepticism is based on the now-rampant selling of everything gold and silver. The lack of clear direction from our Federal government and global instability has caused enough concern to drive metals prices to new records. So many have been trying to sell that national refiners are overloaded. Those are the few companies that take in and smelt what local coin dealers buy and send to them.
It used to be that coin and many jewelry dealers actively traded in the buying and selling of gold and silver. Most still do. However, with the massive amounts being unloaded by the public, as well as by tangibles investors eager to take healthy profits, precious metals refiners have become overloaded. As of two weeks ago, some even raised a white flag stating they could not accept any more. Along with the soaring prices, such a cessation in buying is unheard of.
Gold and silver have historically and traditionally been the “safe harbors” for investors and those hoping to squirrel away wealth for a rainy day. Such was the case dating back thousands of years to when gold was first discovered and/or recognized in ancient Egypt. Objects, amulets, jewelry and coins were concealed and/or buried to assure future wealth. It still is. Of course, if one can’t redeem what they’ve saved, it might seem pointless.
Jews fleeing Nazi-occupied Europe recognized the amplified significance of gold as they fled to safety. Be they in pouches, purses or sewn into the linings of clothing, gold coins often proved their ticket to freedom and the new world. It may not have always been a fortune but perhaps may have been enough to offer a new start or provide food and shelter in a time of crisis.
Recently, I stopped by several local coin dealers to find their purchasing surprisingly limited. One had stopped buying silver bars and bullion altogether save for recognized numismatic coins with a collector value substantially above the silver content. They also were buying US bullion coins such as American Eagle and Buffalo gold. At the time, as for silver bars in any form or size, no joy.
Naturally, the situation is sure to be temporary, just until the major US refineries are able to catch up. Of course, that could be some time. As it is now, refineries are agreeing to buy silver and gold sent to them by dealers with a big caveat. The refiners are no longer offering immediate pricing or payment. It can now take a week or 10-days. Worse, those refiners are only offering payment based on the future price when the deal is settled. As we well know, in less time than that, either metal can rise or fall 10 or 20 percent with the dealer being forced to gamble on the profit or loss. For some, that’s a natural deal breaker.
Last Friday is a prime example. Before noon of that day, gold had fallen almost $300 per ounce with silver dropping $16, almost 14 percent. If that were to happen in the stock market, mild panic might set in.
There are alternatives, mostly bad. The most obvious are buyers such as small pawn shops who usually pay far less than a recognized dealer. Also, pop-up dealers with little track record. Such was the case in 1980 when, with precious metals prices soaring, some hobby shops became overnight coin and metals dealers. They too paid only a fraction of traditional dealers.
As always, whether it be bullion metals or collectible coins, it’s clearly best to consider any investment for the long haul. And, at least for the foreseeable future, expect any gold or silver jewelry to cost substantially more than it has for a long, long time.
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