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Time To Invest! GOLD GLITTERS AGAIN!

Time To Invest! GOLD GLITTERS AGAIN!

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Richard E. Gilbert
Time To Invest!

**GOLD GLITTERS AGAIN**

It's time to take a serious look at the gold market and its relationship to gold pocket watch values. As you can see by the graph below, gold started its run way back in 1999 when it was trading for a mere $252.00 per ounce on July 20th. A slow but steady climb began and gold reached a respectable $525.00 per ounce at the start of 2006. Then it happened! An accelerated run up began and gold reach $725.00 an ounce on May 12, 2006 - remarkable? No, not really, lets just say "long overdue." The run up of the market was impressive but believe me the gold dust has not settled yet!

Gold has always been a favorite of investors seeking hard assets and those concerned about long term capital preservation, asset diversification and as a hedge against inflation. Now, however, there are many new factors changing the economic playing field - factors which are affecting not only the gold market but the watch and jewelry markets as well.
We could analyze the factors for weeks but in brief, just consider the following:

1. Geopolitical uncertainties - Iran and its future intentions, ditto North Korea, surging oil prices. The ugly threat of terrorism.

2. A growing loss of confidence in the paper dollar and great concerns about the strength of the American dollar and economy in general.

3. An ever growing demand for hard assets (i.e. gold, fine watches and jewels) by consumers in China, India, Russia as well as other emerging countries which are under going modernization. Fact - Southeast Asia represents 3 billion people - this is approximately half of the entire worlds population!

4. Supply and demand never changes - mining gold is very expensive with production costs between $200.00 - $300.00 per ounce. There is also the problem of finding gold in large enough concentrations to make it cost effective to mine. Panning for gold may have worked when our antique pocket watches were made but not now.

Where is gold going? The general consensus is that gold will stay around $630.00 per ounce by the end of 2006 and average around $730.00 per ounce in 2007. More speculative thinkers predict that a world financial crisis or major geopolitical troubles could cause gold to spike to about $850.00 per ounce and even as high as $1,200.00 - $1,600.00 per ounce.

How does this relate to gold pocket watches, wrist watches and jewelry?

The value of antique pocket watches, collectors wrist watches and estate jewelry are not based entirely on a "scrap" or melt value. They have an intrinsic value as well. Simply stated - they will never be produced again. This double value (bullion paired with collectibility) simply adds to the appeal and desirability of watches and jewelry. This duality of value also puts you - the collector in a very advantageous position providing you look towards the future and sense the trend before its to late.

Something took place on May 12, 2006 which gave us at Ashland and most likely many other dealers around the world a "bit of a scare." Gold spot hit $730.00 per ounce and now we had literally hundreds of items posted for sale at less than melt! Gold pocket watches, ladies Retro wrist watches with gold bands, bracelets, necklaces, gold watch chains and more - all up for sale but worth more for their gold weight!

Here's a prime example. Lets look at the gold value of a medium heavy Waltham or Elgin, 14K, 6 size ladies gold hunters case. These typically weigh about 20 dwts (one ounce) with the movement, crystal and case springs stripped out. Ashland has been selling watches like this complete, running and near mint for $300.00 each - wonderful antiques from 1880 - 1910! The chart below shows the melt value of these watches.
Wow? One hundred gold 6 size hunters bought from Ashland at $300.00 per ($30,000.00) were now worth in melt value $400.00 per ($40,000.00) on May 12, 2006 with gold at $730.00 per ounce - a $10,000.00 increase in merely a years time!

There are many opportunities like this in the watch and jewelry market place. Keep this in mind. If you think a price is high today - wait until tomorrow it will be even higher, also remember the 3 billion admirers of fine things in Southeast Asia. The high end market for rare watches is already adjusting itself to this new world market - if the item is desirable, it will sell and sell very high. A record price is set the moment it is sold but the record generally only lasts until the same item is offered again and another record is set.

Thanks for reading - please enjoy our special gold sale - every watch offers terrific value inside and out, for today and for the future.

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