Precious Metals Pawned To Pay Bills - Economic Woes Being Felt In San Diego
POSTED: 1:49 pm PDT March 17, 2008
UPDATED: 4:41 pm PDT March 17, 2008
nbcsandiego.com
SAN DIEGO -- The weakness in the U.S. economy and dollar are among the factors pushing gold to record highs. The price jumped to $1,030 an ounce before dipping a bit on Monday.
More and more San Diegans are finding ways to benefit -- trading in their jewelry for cold, hard cash.
Michael Williams of Cellar Coin in Pacific Beach told NBC 7/39 how local San Diegans are using the cash to help pay bills.
"Making house payments or credit card payments -- different things like that -- and they've been lucky for at least the price to be as high as it is," he said.
Jeff Bernard of Palace Pawn Shop agrees. He said some people come into his store and have no idea how much their pawns are worth.
"People will say, 'I think I have $25 or $50, and I'll laugh and I'll say, 'You're not even close. You actually have several hundred dollars.'"
The crumbling housing market, fears of a recession and a historically low dollar, all have contributed to gold's meteoric rise.
The value of the precious metal is so high right now that Bernard said, "People can actually do something with it. They can take small vacation, make a payment. There's a lot of things people can get with the gold or jewelry."
Williams thinks gold will retain its worth during the near future.
"I think it's going to continue. I don't think we've seen the 1980 highs. In 1980, we had lines going out the door for over a block we're not at that point yet," he said.
Impact On Local Economy
San Diegans have seen and felt their share of the money miseries stemming from the collapse of the mortgage loan industry.
"Oh, we're in a recession right now. Everything's going up. All my costs are going up. This sandwich was more expensive," said Bobby Bielik of Rancho Penasquitos. "You've got to pay for it. There's no way around it. It's just going to dip into your savings -- going to dip in and change your budget."
In San Diego County, things have been getting jittery for about a year as foreclosures began reaching records due to subprime lending.
A relatively diversified local economy has helped keep the financial fallout to a mild roar, but the latest disruptions in the global markets and on Wall Street seem to be generating a sense of uncertainty that could dampen people's willingness to spend, to invest, and take risks.
"Locally, for example, consumer confidence has reached, probably, an all-time low. And that could affect people's actions. When people are feeling pessimistic about the economy, they cut back on their economic activity. And that may make things worse," said Professor Alan Gin, an economist at the University of San Diego.
Despite a higher unemployment rate, Gin said San Diego still has positive job growth and an industrial base that's less vulnerable to large-scale wipeouts such as Detroit's automakers and their suppliers. |
