Gold is called a precious metal and itīs precious to our American consciousness. Whatīs happening with its value these days is a telling behavioral slice of these stressed-out economic times. Maybe the oxymoron of scrap precious metal says it all.
The permanence and beauty of gold is why itīs the material we use to express love and why it used to back our national currency. Itīs what we trust when most other things fail us. And thatīs why, as the economy went into the tank, the value of gold and other precious metals conversely got stronger — at least for a while, and depending on the market.
Thereīs been an influx of scrap gold from the jewelry market thatīs been countercyclical. People are selling their gold — which I assume meant something to them when times were good — to the cash-for-gold business thatīs sprung up on TV and feels a lot like the vulture nature of pawn shops. And then thereīs been a surge in business for recycled high-grade gold, for another sad reason — inventory liquidation of jewelers.
But other sectors of the scrap and recycling business arenīt seeing any precious metals boom, because businesses and consumers are holding onto old equipment, or a smaller amount of precious metals are being used in them to begin with.
In an economy when businesses are looking for any sliver of brightness, scrap precious metal has certainly shown some light. But those are most likely temporary surges directly related to the downturn that will disappear when things get better.
Itīs certainly not going to turn around the scrap market. It might help a little, but until people resume buying goods that can use scrap content and pitching old cars and appliances to generate supply, the market wonīt get back to its former health.
Ironically, something so solid as gold isnīt offering a whole lot of substantial and long-term help to turning around the scrap industry. In that sense, we can think of it more as foolīs gold.
Contact Waste & Recycling News Editor Allan Gerlat at 330-865-6167 or firstname.lastname@example.org
(April 27 issue)