Gold has gone mental this month with the UK’s vote to leave the EU and the uncertainty of what happens next in the market.
WHAT DOES THIS MEAN TO A PAWNBROKER
OR YOU AND I?
Well, gold should remain high for the coming months as the rest of Europe and the world reflects on the UK’s decision. This in turn means if you have any gold you want to sell, now could be a great time to sell it.
Equally, those wanting to borrow against gold will know their asset value is more secure and worth redeeming in months to come. Pawnbroking provides the ideal solution for many people at times like this as the banks become more reserved on agreeing cash loans.
The final effect the gold price will have is the price of replacement stock. New gold and silver lines will have a higher cost price and therefore now is the time to buy your jewellery and diamonds at PRE-BREXIT prices! It takes time for the cost price change to filter through so act now if you want to beat the jump – Christmas is only 20 weeks away and counting…..
No matter what you believe is best for the UK or Europe, it certainly makes you want to live for the moment as the decision has been made and we should now get on with life and make the most of it!
THE BIG QUESTION…..
SO THE QUESTION IS, WITH ALL THE UNCERTAINTY GOING ON, IS IT BEST TO INVEST IN GOLD OR TO SELL IT?
The answer is that it really depends on your personal circumstances. This month gold is fluctuating around its highest level since 2013, after the markets crashed. It is still below its 2011 peak though and may not rise any further if the world economies settle down. Equally, as long as there is some uncertainty around, it is likely to stay well supported, so it’s a good time to buy or to sell either way.
We sell our scrap gold little and often. That way we ride the peaks and the troughs every month and sometime we coincidentally time it right, sometimes we don’t. It is however the only way we can continue to offer our consistently high prices when buying gold as it allows us to follow the current market price. I have no idea if tomorrow it will be a better price than today, but if the trend remains high, then now could be a good time to get it sold and to generate some useful cash instead.
PAWNBROKING LEADS THE WAY…..
Our pawnbroking lending has been very robust this year and we are seeing more and more business loans and what have become known as ‘middle class loans’ on high value, designer goods and other items as the banks continue to disappoint. I read an interesting fact recently which stated that the number of bank branches had fallen from 14,000 to 9,700 between 2004 and 2015 and at the same time the number of credit cards issued had fallen by 16.1 million.
There is a real need for instant ‘no fuss’ lending in today’s society and with the popularity and exposure of TV programs like ‘Posh Pawnbrokers’, many people are far less inhibited to use our pawnbroking service.
Pawnbroking continues to be a thriving sector highly regarded by its customers, the government and by its regulators alike. In fact even the former Governor of the Bank of England, Mervyn King recently stated in his book ‘The End of Alchemy 2016’, the following;
“Central banks must behave more like pawnbrokers to stamp out recklessness…..It is time to replace the lender of last resort (the central banks) by the pawnbroker for all seasons”
Pawnbrokers will lend on what the item is worth. With asset backed lending you know where you stand and you have covered your debt if things don’t turn out quite as well as planned. We are proud that over 80% of our customers redeem their goods and we constantly work with customers to ensure they can afford to get their assets back. The few that are unable to collect their items have no further debt to pay as we sell the goods on their behalf to cover what is owed. If the item makes a loss then we suffer the shortfall for making a bad judgement on the items value. If the items sell for more and there is a profit remaining after the cost of the loan, then the customer gets that profit – it really couldn’t be fairer or more regulated.
Wouldn’t it be great if borrowing money was really that simple with the banks – perhaps Mervyn has got it right!
One thing is for sure; we have made our decision and now need to get on positively with life. For that to happen, people need money, so call into your local Brown and Gold Store or email Support@brownandgold.co.uk and see how we can help you with your financing or jewellery buying requirements.
Brown and Gold have six branches with 3 in our region at Seacroft, Shipley and Batley. Call into your local branch for a completely confidential and instant assessment of your goods.
We will remain the pawnbroker for all seasons!
Chris Brown
