New Jersey Jewelers Join Gold Rush

San Diego jewelers take note, your colleagues in New Jersey are taking advantage of the recent popularity in gold buying parties, reports the Ashbury Park Press…

When Thomas Calabro said, “We are at the heart of a gold rush right now,” he was holding up the heart: a mound of gold jewelry on a red velvet display board surrounded by South African Krugerrands.

All told, the assortment was valued at about $250,000. The coins alone were worth almost $40,000, sold to Calabro by a longtime client while gold was spiking at $954 an ounce.

“The last time gold was sky high was around 1979, the year we opened,” said the owner of Twin City Jewelers on Clifton Avenue in Lakewood. “We built this place on the last gold rush.”

In 1980, gold peaked at about $850 per ounce. Last March it broke the $1,000 mark for the first time in history.

Calabro has the current recession to thank.

As trust in traditional money investments erodes, many people are turning to the most reliable of currencies. And that means quadruple the business for Calabro in the gold sector.

The boost in the “scrap metal” trade for jewelers has hedged a slowdown in retail. So now’s the time when jewelers and jewelry owners are perhaps the only people in the country able to bask in this economic climate — indeed, they’re throwing parties.

After spending a while on the sidelines watching their businesses lose to private “gold parties” — the much flashier cousin to the Tupperware affairs — jewelers have started to play a hand.

Earth Treasures in Eatontown is advertising to host “gold-selling” fund raisers for charities, in which partygoers sell unwanted jewelry, silver, coins and scrap gold for cash, with the charity receiving a percentage of each transaction.

Calabro himself has visited many homes, arriving sometimes with $20,000 in cash and leaving after some hors d’oeuvres with a case of jewels.

“It was very frustrating,” Calabro said of the initial competition. “But if you can’t beat them, you have to join them.”

Over $6.7m at Auction

National Jeweler reports that Patrizzi and Co.’s April 19 horological auction brought in more than $6.7 million. Three commemorative-edition Patek Philippes earned the top prices.

An 18-karat yellow gold Patek Philippe minute repeater with perpetual calendar and moon phases was the star of the show, selling for about $349,787. The wristwatch was produced in a small series in 1989 to celebrate Patek’s 150th anniversary.

A Patek “Officer’s style” minute repeater chronometer wristwatch, sold for about $332,724. The timepiece was made in 1997 as one of 10 watches in 18-karat yellow gold to commemorate the new company headquarters just outside of Geneva.

Finally, a Patek Philippe minute repeater wristwatch produced in 2004 as one of five to mark the 50th anniversary of George Pragnell Jewellers in London, sold for about $315,718.

Patrizzi and Co. said in a media release that in addition to the enthusiasm for Patek Philippe, bidding was competitive for several Vacheron Constantin and Panerai wristwatches, as well as for a Hublot “Big Bang Tourbillon Solo Bang,” which nearly doubled its estimate.

Also selling well were a Breguet “souscription” watch in 18-karat gold that was originally sold to Prince Ferdinand in 1812; a Louis Audemars No. 12131 circa 1875; and a Patek Philippe and Cie yellow gold keyless “World Time” gentleman’s dress watch with a cloisonne enamel map of North America. The timepieces sold for about $36,142, $77,457 and $79,178, respectively.

A Question of Ethics

In a recent issue of Instore Magazine, a regular must read publication for hundreds of jewelers across the country, the following scenario was depicted:

Several weeks after a jewelry buying event, Jimmy was delighted to see Sonia Carrell come into the store. She and her husband John had been coming to the island every year for as long as he could remember, right up till last year. Jimmy had heard from neighbors that the Carrells had decided to stay in Maryland last winter, and while he spotted John very briefly at the buying event, he never quite got around to saying hello. As he greeted Sonia, Jimmy noticed that she looked rather tired and worn out. He got the usual rundown when he asked about her college-age son, her older daughter and their beautiful granddaughter, but was taken aback when he asked, “So, where’s John today?” Sonia replied, “I have no idea — but if you see him, let me know so I can leave the island!” The expression on Jimmy’s face must have conveyed his surprise, because Sonia said, “Oh – I’m sorry. I guess you haven’t heard…” She proceeded to tell him about John’s affair with a young assistant at his law firm, and a very ugly divorce that dragged on for over a year. She said that the worst of it was that in the middle of all the fighting, someone had broken into her house and stolen all of her jewelry and several pieces of expensive art. She believed that John was behind it — as a way to get back at her for demanding a hefty settlement — but neither she nor the local police could prove anything. She said that while her insurance covered the financial end of the loss, the sentimental value of many of the jewelry items could never be replaced.

As soon as Sonia had pulled out of the parking lot, Jimmy went back through the receipts from the gold-buying events and felt his heart sink as he saw one with John Carrell’s name on it. He saw that one of his friends had taken care of John, who sold several gold bracelets, a couple single earrings, a pair of platinum wedding bands and a diamond fashion ring — for a total of $1,860. State law requires that merchandise bought over the counter remain in the store for a full 30 days before disposition, so Jimmy was able to look at the pieces in John’s envelope. Despite his sincere hope to the contrary, he was not surprised to find the envelope filled with pieces that he had sold to John over the years.

Jimmy double checked all the documentation and was relieved to find that the transaction was handled perfectly and every detail was in compliance with state and local regulations. Nonetheless, the whole thing left him with a queasy, uncomfortable feeling, believing that he had some sort of responsibility to Sonia — but not knowing exactly what to do about it.

THE BIG QUESTIONS: Should Jimmy get involved at all? Is his obligation to John — one of confidentiality and the discretion promised to all of his clients — or is it to Sonia — one of friendship and integrity? He knows for certain that the pieces were sold to John, but he has no way of knowing for sure that Sonia’s story is anything more than just her side of an ugly tale. Is he obligated to notify the local or Maryland police of his suspicion, or should he let the rest of the 30-day waiting period expire, then dispose of the items, along with all the rest?

It is our feeling here at The San Diego Luxury Pawn Shop Report that only one moral and ethical answer exists. If a jeweler, pawn shop, or jewelry buyer has ANY suspicion that the goods sold them were obtained fraudulently, then the police should be notified immediately. End of discussion.

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