News / Economy

Rising Gold Prices Spark Demand

Gold bars are shown at the Korea Gold Exchange in Seoul, South Korea. Gold's allure stems in part from fears that the world's major economies are dangerously indebted,  August 9, 2011
Gold bars are shown at the Korea Gold Exchange in Seoul, South Korea. Gold's allure stems in part from fears that the world's major economies are dangerously indebted, August 9, 2011

Multimedia

Every new piece of bad economic news and every plunge on Wall Street sparks fears that the worst is yet to come.  As a result, many people are turning to one investment they feel they can trust.

Gold chains, gold bangles and gold coins - all increasingly expensive.

Still, customers stream into a Vienna, Virginia, jewelry store, outside of Washington.

“I wanted to get a little pendant and a little chain,” customer Dia Majumdar explains.

At a time when many Americans are selling their gold for cash, Indian-born Majumdar is among the many Asian-Americans looking to buy - for herself and for something to pass on to her daughter and grandchildren. “And those of us who have bought the gold jewelry know that they have an asset to fall back on," she added. "I still have a lot of my gold wedding jewelry left and I know in the back of my mind that it’s there.”

May Jewelers caters especially to the Asian community.  Vice president Vincent Nguyen says Mujamdar is not alone. “We have people who save up for months and just come in here and buy a one-ounce coin for investment,” he stated.

It is a big investment.  A gold chain that cost $300 a few years ago now sells for $900 or more.

“A lot of our clientele believes in gold," Nguyen notes. "If there is a special occasion - it could be an anniversary, a wedding occasion - people buy gold.”

For lots of Asian-Americans, gold is a safe investment, a hedge against uncertain economic times.  For others, the value is much greater.

“It’s psychological, isn’t it?" says Larry Shinagawa, director of the Asian-American studies program at the University of Maryland. "More than anything else, you have the sense of having something of lasting value in a world that is so transient and so much in turmoil.”

But Shinagawa says that cultural comfort is only part of the reason many Asian-Americans are snapping up gold and other precious metals.

“There has been about a 60 to 68 percent drop in the amount of wealth among Asian-Americans in a very short time period of only four years.  Much of it is real estate,” he says.

It is not just Asian-Americans looking to gold to preserve their wealth.  

Demand for gold has been rising worldwide, India and China leading the way.

And for many people, says Professor Anil Gupta with the University of Maryland Smith School of Business, gold remains less risky than many alternatives.

“If I look ahead at least over the next two, three, four, five years, the likelihood of volatility in world economies, in the stock market, it’s likely to remain high," Gupta says. "And in times of volatility gold is likely to be seen as a relatively safe haven.”

For now, that means brisk business for jewelry shops, like this one, where some customers are even passing on luxury items - like flat screen TVs - to get a little more gold.

You May Like

China Announces Corruption Probe into Senior Ex-Leader

Former security chief and member of Politburo Standing Committee, Zhou Yongkang, being probed for suspected 'serious disciplinary violation' More

India, US Look to Reset Ties During Kerry Visit

This week's talks will be first high level interaction between two countries since Prime Minister Narendra Modi took charge More

Video Young African Leadership Program Renamed to Honor Mandela

YALI program, launched by President Obama in 2010, aims to build skills in business, entrepreneurship, public management and civic leadership More

This forum has been closed.
Comments
     
There are no comments in this forum. Be first and add one

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
Vietnamese Staging Chinese Product Boycott After Oil Rig Spati
X
Reasey Poch
July 28, 2014 7:18 PM
China recently pulled an oil rig from an area of the disputed South China Sea that Vietnam also claims. Despite the action, the incident has had a lingering effect on consumers in Vietnam. VOA's Reasey Poch reports from Hanoi on an effort to boycott Chinese products.
Video

Video Vietnamese Staging Chinese Product Boycott After Oil Rig Spat

China recently pulled an oil rig from an area of the disputed South China Sea that Vietnam also claims. Despite the action, the incident has had a lingering effect on consumers in Vietnam. VOA's Reasey Poch reports from Hanoi on an effort to boycott Chinese products.
Video

Video ESA Spacecraft to Land on a Comet

After a long flight through deep space, a European Space Agency probe is finally approaching its target -- a comet millions of kilometers away from earth. Scientists say the mission may lead to some startling discoveries about the origins of the water on earth. VOA’s George Putic has more.
Video

Video Young Africans Arrive in US for Leadership Program

President Barack Obama's Young African Leadership Initiative has brought hundreds of young Africans to the United States for a six-week program aimed at building their knowledge and skills in fields such as public administration and business. Out of the 50,000 young Africans who applied for the program, just one percent was accepted. VOA's Laurel Bowman caught up with some of those who made the cut and has this report.
Video

Video In Honduras, Amnesty Rumors Fuel US Migration Surges

False rumors in Central America are fueling the current surge of undocumented young people being apprehended at the U.S. border. The inaccurate claims suggest the U.S. will give amnesty to young migrants from the region. As VOA's Brian Padden reports from Honduras, these rumors trace back to President Obama's 2012 executive order to halt deportations for some young undocumented immigrants already living in the United States.
Video

Video Students in Business for Themselves

They're only high school students, but they are making accessories for shoes, fabricating backpacks and doing product photography - all through their own businesses. It's the result of a partnership between a non-profit organization that teaches entrepreneurship and their schools. VOA's Mike O'Sullivan and Deyane Moses met the budding entrepreneurs near Los Angeles.
Video

Video Astronauts Train in Underwater Lab

In the world’s only underwater laboratory, four U.S. astronauts train for a planned visit to an asteroid. The lab - called Aquarius- is located five kilometers off Key Largo, in southern Florida. Living in close quarters and making excursions only into the surrounding ocean, they try to simulate the daily routine of a crew that will someday travel to collect samples of a rock orbiting far away from earth. VOA’s George Putic has more.

AppleAndroid

World Currencies

EUR
USD
0.7305
JPY
USD
101.53
GBP
USD
0.5830
CAD
USD
1.0656
INR
USD
60.075

Rates may not be current.