More oil for your gold

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We are Kamaaina Loan and Cash For GOLD, so we are always fascinated by what gold does. Not that we have any control over it. We buy gold by the tenth of a gram; the big players trade a minimum 1,000 pounds at a time.

So we were as surprised as anyone when gold staged a rally this past week. Here’s what Bloomberg News reported:

 

Bullion jumped 4.1 percent last week for the best performance since August amid a global equity rout spurred by a stock market slump and a weakening currency in China.

Bloomber also reported that gold compared with oil is worth twice what it has been for the past generation — and that was before oil took another tumble yesterday:

 

An ounce of gold buys more than 33 barrels of oil, the most since 1988. The average ratio has been 16.

It sounds like an excellent time to bring your broken or unused jewelry, any gold coins you find behind the cushions in your sofa or any other unneeded gold you have to Kamaaina Loan and Cash for GOLD.

 

#mauigold #mauiretail

Gold — and not only gold — takes a powder

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At the start of this year, the mavens at Goldman Sachs — who had called the price movement of gold quite closely in 2014 — predicted it would finish 2015 as low as $1200 an ounce.IMG_3692

Maybe it will, but already in July it is plunging near $1,100. We think it is fair to say that no one foresaw this. Certainly at our little pawn shop, we didn’t.

But it isn’t only gold. Bloomberg News reports that world commodity prices have fallen to levels last seen in 2002. Gold, by contrast, has fallen to 2010 levels.

Raw materials are losing favor with investors as the dollar gains amid signals from Federal Reserve Chair Janet Yellen that the central bank may raise rates this year on the back of an improving U.S. economy. Higher borrowing costs curb the attractiveness of commodities such as gold, which doesn’t pay interest or give returns like assets including bonds and equities.

The other commodities include things like iron, natural gas, oil and wheat. At Kamaaina Loan And Cash for Gold, we like to say we will buy (or make a loan on) “anything that doesn’t eat. But we don’t buy (or lend on) oil or wheat. And salesfor that, just now, we are thankful.

 

We get calls

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But the callers don’t always appreciate an honest answer.

Caller to Kamaaina Loan pawnshop: Do you buy jewelry if it is gold-filled?

Us: We’ll look at anything, but “gold-filled” really means “no gold.”

Caller: It means “no gold”?

Us: It’s something retailers have used for years and years. There is a microscopically thin covering of gold, but essentially it means no gold.

Caller (sounding kind of exasperated): That’s good to know. Thank you.

 

Pretty packaging

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Some people will go to quite a bit of trouble to steal a measly $7,446.

Like the guy who made up 866 fake one-ounce silver bars and encased them in plastic.

Then, according to the Delco Times, he took them to a pawn shop outside Philadelphia, which incautiously accepted them as real without breaking open the plastic to test.

Not right away, anyhow:

“(Pawnbroker) Oblon told police he has purchased one-ounce silver bars from other customers in the same way in the past. . . .

Oblon became suspicious and broke open several randomly selected bars and tested them. The test showed the bars were not real silver, police said.

The story does not say what the fakes were made of. It is possible that even non-destructive testing could have detected them, although that would require breaking open the cases.

The Delco Times story does not say, but presumably the seller left his ID and address etc. with the buyer, which is required in many jurisdictions. At any rate, the pawnbroker knew where to find him in New Jersey.

It was a bad deal all around. The $7,446 paid for the fakes was only half what 866 ounces of real silver are worth among big dealers. Small dealers like coin shops and pawnbrokers buy at a discount, but a 50% discount is steep.

See gold go UP!

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A month ago, gold was trading at $1,175 an ounce. This morning, it is a bit over $1,290.

That’s a gain of about 10%, and, no, we didn’t see that coming.

So bring us your gold, and we will buy it or lend on it, and either way, we can offer you more than we could afford to a month ago.

Will it go down 10% over the next month? We have no idea but it’s risk we have to take to keep delivering financial help with aloha to Maui people, just like during all the swings up and swings down over the past 38 years.

#mauiloan #mauigold #mauiretail

Farewell to 2014, a ‘meh’ year for gold

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At Kamaaina Loan we look forward to 2015, because gold has got to have a better year than the one it just had.

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Of course, we make loans and buy gold whether it is up or down, but like most people (bears excepted) we like the price to be up. That allows us to lend our customers more, or pay them more for their gold. They like that and we like it.

Gold started the year around $1230 an ounce. (The charts are available from Kitco.com.) In March it made a run up to $1380, but on the last day of the year it swooned, finishing at a disappointing $1182.

Well, it’s a new year and a fresh start and we wish you well and hope to see you sometime. We will deal for gold, however you want, and as always offer the best deals on the island, with aloha.

Hauoli makahiki hou!

Bad for Russia, good for gold

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When asked about the direction gold will take, Big Rich always says, “It will go up, or it will go down, or it will stay the same.” Seldom does it do both so enthusiastically during one 24-hour period than it did Monday and today, however. As Bloomberg News reports:

Gold rebounded from yesterday’s biggest drop this year as investors sought a haven amid turmoil in emerging market economies and falling commodities.

Russia’s ruble plunged to a record low after the country’s largest interest-rate increase in 16 years failed to revive confidence in the currency. The Turkish lira also tumbled to an all-time low.

Your Christmas (or Hanukkah) present is you don’t have many Turkish lira. Lucky you.

(Silver did not get the same kind of love. When nervous people with money look for comfort, they don’t look to silver — usually.)

The New York Times has much more about why gold did the big turnaround. It’s the ruble. It was less than 20 years ago that Russia defaulted, bringing down Long-term Capital Management and its two Nobel prize-winning advisers who didn’t understand that things can change on a dime — or 10 kopecks.

The economic news had another victim not mentioned in the news reports: Obama haters. Remember how they were sure that Obama’s “soft power” tactics were making the United States a pitiful has-been? Well, the five countries that are subject to US (and to some extent international) economic sanctions are all on the verge of economic collapse: Russia, Iran, North Korea, Venezuela, Cuba.

It might not be a great idea to collapse countries with nuclear weapons, but the sanctions were meant to have an effect and they are having it.

As always, Kamaaina Loan is ready to buy or sell gold for you at whatever the day’s price is. We don’t care about the ruble.

#mauipawn #mauiretail

 

 

 

 

Wow! Sure didn’t see that coming

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At the Kamaaina Loan blog we have been following with amusement and fascination the ups and downs of the gold price over the past few weeks. One minute the price jumps to $1250 and a day or two later it’s under $1200 and then back up again.

Sometimes the moves can be attributed to some pretty obvious doings in the world economy, sometimes the leaps and slides seem practically uncaused. But the price has gyrated around the $1225 that the gurus at Goldman Sachs last year were predicting for this period.

But who anticipated that late last week the Japanese central bank would decide to pump a lot of yen into the deflated Japanese economy, the latest in a series of failed attempts to bring that sector out of deflation? (Although the US Federal Reserve and many other wise heads have been worrying for years about inflation, deflation is the big problem. Economists know how to control inflation but — as the experience of Japan over the past 25 years and of the whole world economy in the ’30s demonstrated — deflation is the really intractable problem.)

The American stock market went crazy, with the Dow Jones Industrial Average spiking to a record high. Just why the transfer of ownership of a small fraction of Japanese equities from private (mostly Japanese) hands to Japan government hands should make American stocks so much more valuable is hard to figure.

But the effect on gold and its poor stepsister silver — once the stock market had reacted — was in line with conventional thinking: both fell off a cliff.

Gold got down to a four-year low and shortly before the market reopened today buyers were offering a mere $1172. Silver cratered. It has been a long while since it broke under $17. Today it is flirting with $15.

#mauipawn #mauigold #mauiretail

Gold gyrates

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The price of gold changes every day, sometimes by quite a lot — a $25-an-ounce move is not unusual. But it doesn’t usually vary so much within a day that Kamaaina Loan has to adjust the amount it offers on gold loans or purchases.

Today, as gold continues a strange series of gyrations, a midday adjustment began to look like a good idea. (In the end, we didn’t change, though it might have cost us a few bucks.)

As our day began, gold was selling at just under $1227 an ounce.So that’sd where we pegged our offers for this day. Within less than 2 hours, it was down to $1209. It got as low as $1207 before rallying to around $1211 just before the market closed in New York City (which happens just after 11 a.m.Hawaii time).

The folks at Kitco, who offer a daily smorgasbord of gold news and opinion, thought the move — the biggest in 3 weeks — was an unhappy reaction to the release of the minutes of the Federal Open Market Committee. Kitco thinks gold traders think higher interest rates will be bad for gold (although, amusingly, you can find every shade of opinion on their website), for reasons that are opaque to us in the pawnshop.

Still, it has been a more than usually exciting couple of weeks for people who watch gold prices. As Big Rich always says, “Gold will go up, or it will go down, or it will stay the same.”

 

So, what did gold do today?

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Not much,.

Yesterday, Kamaaina Loan blog wondered if gold would track the stock market, which in theory it sort of does — gold up when stocks fall and vice versa.

Over the past couple years,. stocks have reached record highs and gold has taken a swan dive, off around 30%. But is the relationship real?

Recently, the stock market has been gyrating like a yo-yo, and gold prices have risen and fallen, but not so violently.

So, if we understood what is going on, we wouldn’t have to work so hard in the pawn business and could lie on the beach all day. But we don’t.

Tuesday,. stocks were way up: the Dow was up 1.12%, the S&P 500 1.19% and the Nasdaq 1.75%. Those are all big movements for a single trading day, especially the Nasdaq.

What did gold do? It went up, by 0.22%. Not down. And when the spot market reopened, after the stock exchanges were closed and the traders had had a chance to digest the mood, gold did go down, but by a mere 0.02% (only 30 cents on a quote of $1227.50, barely noticeable).

Well, to heck with it, we’re off to the beach anyway.

#Mauipawn #mauigold #mauiretail