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

Ukraine Purges Interior Ministry Leadership With Pro-Russian Ties

Interior Minister Avakov says 91 people 'in positions of leadership' have been fired, including 8 generals found to have links to past pro-Moscow governments More

US Airlines Point to Additional Problems of any Ebola Travel Ban

Airline officials note that even under travel ban, they may not be able to determine where passenger set out from, as there are no direct flights from Liberia, Guinea or Sierra Leone More

Nigerian President to Seek Another Term

Goodluck Jonathan has faced intense criticism for failing to stop Boko Haram militants 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.
Talks to Resume on Winter Gas for Ukrainei
X
Al Pessin
October 25, 2014 4:21 PM
Ukrainian and Russian officials will meet again next week in an effort to settle their dispute over natural gas supplies that threatens to leave Ukraine short of heating fuel for the coming winter. VOA’s Al Pessin reports from London the dispute is complex, and has both economic and geopolitical dimensions.
Video

Video Talks to Resume on Winter Gas for Ukraine

Ukrainian and Russian officials will meet again next week in an effort to settle their dispute over natural gas supplies that threatens to leave Ukraine short of heating fuel for the coming winter. VOA’s Al Pessin reports from London the dispute is complex, and has both economic and geopolitical dimensions.
Video

Video Smugglers Offer Cheap Passage From Turkey to Syria

Smugglers in Turkey offer a relatively cheap passage across the border into Syria. Ankara has stepped up efforts to stem the flow of foreign fighters who want to join Islamic State militants fighting for control of the Syrian border city of Kobani. But porous borders and border guards who can be bribed make illegal border crossings quite easy. Zlatica Hoke has more.
Video

Video China Political Meeting Seeks to Improve Rule of Law

China’s communist leaders will host a top level political meeting this week, called the Fourth Plenum, and for the first time in the party’s history, rule of law will be a key item on the agenda. Analysts and Chinese media reports say the meetings could see the approval of long-awaited measures aimed at giving courts more independence and include steps to enhance an already aggressive and high-reaching anti-corruption drive. VOA’s Bill Ide has more from Beijing.
Video

Video After Decades of Pressure, Luxembourg Drops Bank Secrecy Rules

European Union finance ministers have reached a breakthrough agreement that will make it more difficult for tax cheats to hide their money. The new legislation, which had been blocked for years by countries with a reputation as tax havens, was approved last week after Luxembourg and Austria agreed to lift their vetoes. But as Mil Arcega reports, it doesn’t mean tax cheats have run out of places to keep their money hidden.
Video

Video Kobani Refugees Welcome, Turkey Criticizes, US Airdrop

Residents of Kobani in northern Syria have welcomed the airdrop of weapons, ammunition and medicine to Kurdish militia who are resisting the seizure of their city by Islamic State militants. The Turkish government, however, has criticized the operation. VOA’s Scott Bobb reports from southeastern Turkey, across the border from Kobani.
Video

Video US ‘Death Cafes’ Put Focus on the Finale

In contemporary America, death usually is a topic to be avoided. But the growing “death café” movement encourages people to discuss their fears and desires about their final moments. VOA’s Jerome Socolovsky reports.
Video

Video Ebola Orphanage Opens in Sierra Leone

Sierra Leone's first Ebola orphanage has opened in the Kailahun district. Hundreds of children orphaned since the beginning of the Ebola outbreak face stigma and rejection with nobody to care for them. Adam Bailes reports for VOA about a new interim care center that's aimed at helping the growing number of children affected by Ebola.

All About America

AppleAndroid

World Currencies

EUR
USD
0.7893
JPY
USD
107.68
GBP
USD
0.6238
CAD
USD
1.1214
INR
USD
61.185

Rates may not be current.