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Saturday, February 21, 2009

Silver, Gold, and the Hunt Brothers

by Calculated Risk on 2/21/2009 11:46:00 AM

From the LA Times: Gold fever sweeps suburbia

Gold is hot. The precious metal soared $25.70 an ounce Friday to $1,001.80, topping the $1,000 mark for the first time in nearly a year. South African Krugerrands, American Eagles and other gold coins are in demand as people seek safe investment havens in uncertain times.

That has people digging through their drawers and jewelry boxes looking for watchbands, cuff links, chains and bracelets that can be sold to jewelers, pawnshops and other brokers to be melted down to feed the growing demand for gold coins.

The party Geivet attended at the Aliso Viejo home of Mary-Margaret Fincher is a twist on the old suburban Tupperware party. Here, however, it's the guests who do the selling.
There were earrings from ex-boyfriends, ring settings with missing stones and chain bracelets from sorority sisters. One woman brought in her husband's wedding ring -- from a previous marriage.
I don't follow gold, but back in the late '70s I was long the silver market. I closed my positions when housewives started selling the family silver - and eventually shorted the market. Of course that market was being manipulated by the Hunt brothers, but this story reminded of early 1980.

Note: not intended as advice. Besides I don't follow gold. This was just a short trip down amnesia lane.