The Gold Standard

Dollar's Fall is Felt Around the Globe - Anthony Faiola @ WaPo

The dramatic rise in precious metals in recent years is another element often overlooked with the weakening dollar. Three years ago gold was holding steady (as it had for the past decade) at around $400 per troy ounce with platinum following suit at $700 an ounce. But today's prices continue to astound me. Not since the early 80s has gold been priced so high ($800 a troy ounce and platinum at nearly $1,500). As a jeweler I can't ignore the doubling of material costs and have to pass that on to customers. In addition I've begun fielding lots of questions over how best to sell one's gold only to give a customer the unfortunate news that they will, at best, receive an under-wholesale value. It does work well for us when we have our filings and bench sweeps refined but one cannot run a business like that. When you depend on repairs like retipping prongs, sizing rings and custom work, higher material costs, while giving us a larger profit margin, cut into the amount of work done. What was once a $25 sizing job suddenly becomes a $45 job. Most of the effects of a weak dollar aren't so directly felt but in the world of jewelry a doubling of costs is quickly reflected. It's not heartening to say, but when the dollar starts to weaken people start to buy into fixed commodities like gold and that causes a lot of ripples.