Under the global financial and economic crisis, prices for gold jewelry have been literally blown up in Switzerland and Germany. According to the French mass media, they shot up more than 500% compared to the last quarter of 2008!
This is an important development for the French, who have traditionally been the most reverent worshippers of gold jewelry. On a global scale, they account for more than one third of gold held in private hands.
Jacques Copty, a well-known Paris jeweler, member of the European Chamber of Experts and Art Historians links this “upsurge” in prices for expensive gold jewelry to the fact that a great demand at the height of crisis, when people more often than not turn their eyes to the so-called safe-haven assets, runs against a scaled-down supply incapable to meet it.
“There is a high demand for fine jewelry, but unfortunately there is an insufficient number of merchants to offer such jewelry,” the jeweler states.
Meanwhile, gold and gold jewelry are viewed by experts not only as a reliable investment for one’s capital but also as something giving you pleasure.
The crisis on the world financial markets also served to make yellow metal jewelry more attractive in the eyes of those Europeans, who are intent on leaving some family legacy to their offsprings.
Taking into account the gold rate which in 2008 fluctuated around 20,000 euros per kilo, experts point out that putting one’s money into signature gold jewelry is not a bad investment move in view of the upward trend in prices for this metal.
This being said, as experts advise, one should be aware that a gold jewelry piece to be bought is to be unique and of a long-term designer value.
French experts remind to those who being guided by some strategy or their taste prefer to purchase antique jewelry pieces made of gold that quality is the key yardstick in this market segment.
“With the lapse of time their rarity is only increased,” notes in this connection Marc Boutemy, another famous jeweler from Paris.
In his opinion, an antique jewelry piece has a potential collection value and thus may bring profit to its owner. For instance, “tank” rings manufactured in the 1940s-1950s do not cease to grow in price. And they are not necessarily priced higher if there is a signature hallmark on them.
Taking part in an auction it should be kept in mind that such trading sessions are not missed by professional resellers and sometimes people unaware of market trends may inadvertently contribute to make the price for a jewelry piece exceed its market value.
Auction trading sessions held in Hong Kong, Geneva or New York are particularly closely “patronized” by resellers or their confidents.
In its turn, one critically important advantage of buying antique jewelry from specialized merchants is that their customer may not only bargain on price but also pay by installments.
As for reselling, experts warn that with the exception of unique and small-lot jewelry selling modern gold jewelry is inevitably associated with its depreciation. And this is only because such jewelry is not considered new any more, but second-hand.
Thus, gold jewelry pieces bought at trade malls, if sold, will be valued by their gold content minus a 20-percent markdown given their further re-melting. Current prices for gold “scrap” in Europe are about 15.50 euros per gram.
Some investors are buying the yellow metal for quick resale and gaining profit due to growing prices at the exchange.
Regarding signature gold jewelry as a whole, people, who are going to re-sell such pieces on the Western market right now, are to be ready to lose about 50% of their value, experts caution.
Alex Shishlo, Rough&Polished European Bureau Editor in Brussels
