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For some, gloom is good as gold
The Courier-Mail
October 11, 2008 04:25am
THANKS to the financial firestorm sweeping the globe, business in one niche of the Australian economy has never been better.
Gold bullion dealers around the country are reporting spectacular sales as investors flock from traditional forms of investment such as stocks and bonds into the "safe haven" of gold and silver bullion.
In one Sydney bullion house in the past week, a senior Westpac Bank manager walked in and bought nearly $300,000 of physical gold, equivalent at current prices to roughly 6.5kg of the metal.
The manager said he had made the decision after he saw many of his staff (investment advisers) converting their cash and other savings into gold.
Scary stuff.
The price of gold, of course, like shares and bonds, can also fluctuate wildly, but unlike shares, the investment can never just be wiped off the face of the earth overnight.
Regardless of the risks inherent with investing in commodities - in the past month the price has fluctuated between about $US740 and $US900 an ounce - gold is becoming the new black.
Lisa Casagrande, who in a former life was a champion striker for the Australian soccer team the Matildas, runs Gold and Silver Bullion Australia, located on the Gold Coast. She says that, in the past week or two, there has been a 60 to 70 per cent spike in business as people flee banks and share investment.
Currently, her business is shifting between 500 and 1000 ounces of gold bullion a day (1000 ounces is worth about $1.3 million at today's price).
Gold's sister metal is also in high demand. Casegrande maintains that "there is a lot of investment at the moment in silver bullion . . . so much so that a lot of the refineries have a 10-week waiting list".
The way people are buying has also changed.
Casegrande says: "A lot of the bigger investors are taking much larger amounts of bullion."
