Since the first time man made gold beads to make jewellery, gold has been the preferred and the most sought-after precious metal in the world. This yellow metal has held its allure for millennia and remained valuable with today’s prices soaring above $1,600. There are different reasons why people buy gold jewellery. It goes beyond fashion and vanity but some cultures recognize the intrinsic value of gold and that it always surpasses the value of paper money. For some people, it is better to hide gold jewellery in your mattress than it is to hide a wad of cash. A country’s currency could become worthless overnight but gold remains valuable in the worst crisis. You can always get cash for gold jewellery when you need to.
When things go horribly wrong
Take Venezuela, for instance. These days, The Venezuelan Bolivar has become so worthless, people use it as scrap paper or simply just throw it away. Venezuela which is an oil-rich country was flush with money at some point when the price of oil was high. The county’s economy was based on oil and during Hugo Chavez’s presidency and the country pretty much imported everything it needed. It could afford to subsidize other fledgling economies but it forgot to male contingencies for the periodic rise and fall of the price of oil. While petro-states like Kuwait and Brazil managed to save money to counter unstable oil prices, Venezuela felt that it had enough to subsidize other fledgling economies. The demise of the currency itself was caused by hyperinflation. Instead of making the necessary fiscal reforms, President Nicolas Maduro, Chavez’s successor turned on the printing presses to take care of domestic debt. Hyperinflation is estimated to have reached 53,798,500% in April 2019. That’s a nightmare situation – to wake up one morning and find that the $1,000 you had hidden your house has been reduced to worthless paper. Now if you had jewellery that was worth $1,000 a year ago, you could sell it for a sizeable amount of money today, if you lived in Venezuela.
Venezuela’s social and political implosion and its economic collapse is complicated and longer than what’s just been described here but it is a great example of how fiat currencies can and have failed and why you should have a bit of gold to fall back on in times of crisis. Throughout the years, gold has been an excellent hedge against inflation, deflation and the erosion of currencies which makes it worth holding on to.
Cash for Gold in Crisis
These days there are several businesses that have sprung up offering cash for your jewellery. They even ask you to bring in your old and broken jewellery too. So, no matter how old your gold jewellery is or what state it is in, there is someone who is looking to buy it off your hand. This is because most cash for gold buyers are only interested in the gold content in your jewellery, not that the jewellery looks like. Unlike pawnbrokers or second-hand jewelers, cash for gold buyers only buy gold to sell it to refiners where it is melted, refined and recast into bars to be sold to make various products.