The New, Ugly Face of A Modern Day Gold Rush

Posted by Mike Tirone - Tuesday, September 6th, 2011

Leave it to the man who sells do-it-yourself mining equipment within the 19^th century Australian gold rush town of Ballarat to say it himself, “panning for gold is becoming a real family affair, more popular now because of the gold price.”

Cordell Kent sees it...

The world is changing rapidly with livelihoods completely changing due to the astronomical rise in gold's value. Every corner of the globe is being affected by this recent rush. Gold is so hot that it's becoming lethal. The news reports continue to fly in about more robberies, more murders, and more anarchy surrounding the precious metal.

“Some people I know are making hundreds, even thousands of dollars on the weekends [panning for gold]. We're seeing a whole new gold rush now,” the Ballarat native said.

Reports of people ripping out gold crowns from teeth of their dead grandmothers' and others stealing and trying to sell Buddha statues which look to be gold, but are were in fact made of brass.

Spot gold is now selling for about $1,830 an ounce, which is up by nearly a third this year alone, and the prices continue to rise.

But experts say sales of recycled gold will rise only about 5 percent this year, against 30 percent in 2009. "Either people are waiting till the price hits $2,000 or they are running out," says Mariabi Peenya, a street side dealer in New York's Diamond District.

Truly, the entire gold has not seen a gold rush like this one. A vicious storm of global economic downturn -- paired with the tremendous jump in gold prices -- is giving people incentive to let greed overrun them.

Crimes across the globe have been escalating. Major robberies have been reported in Dubai, Casablanca, and in the U.S. One gold dealer in Ghana is being accused of fraud after being held up and robbed of his gold, and was unable to deliver the gold he promised to his customers.

While people start to off-load their gold, many other ill-intentioned people look to help them get rid of it by waiting outside pawn shops and gold buyers to strip them clean. It's becoming a struggle between human decency and human greed. Gold chains continue to be ripped off necks from London to China, but most often in India, as the country is the world's biggest buyer of gold.

In northern Vietnam, a gold shop owner, his wife and 19-month-old daughter were killed and the shop robbed 10 days ago in one of the most violent crimes in the country in years. Another daughter was discovered cowering under a bed with her hand severed.

In France, there were 183 armed robberies of jewellers in the first half of 2011, up from 138 in the year-earlier period, according to OCLCO, a police agency that tackles organized crime.

"If gold is a safe haven for people with savings, it is also becoming it would seem a safe haven for armed robbers," said Frederic Doidy, an officer with OCLCO.

The golden days of generational jewelry and small amounts of the yellow metal tucked away in parts of your house now seem to be lost and gone.

*Indented text comes from Reuters.com

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