As Gold Prices Soar, More Filipinos See its Value

Published September 7, 2020, 6:47 PM

by Len Amadora

In August of 2020, business tycoon Warren Buffett bought shares in the Canadian mining company Barrick Gold Corp., reinforcing the value of gold, whose price soared above $2,000 per troy ounce, in the world market. This shows that despite the ongoing global pandemic, the value of gold continues its upward trend. 

Chamber of Pawnbrokers of the Philippines, Inc.(CPPI) President, Jean Henri Lhuillier knows the value of gold, all too well, proving how valuable this rare metal is and why Filipinos should realize its importance as a good investment asset.

“Gold remains to be one of the best commodities to invest on because it is a highly liquid asset. There is always a strong local and global market demand for gold and besides this, owning gold also acts as a hedge against inflation and even deflation, because its price tends to rise when the cost of living increases,” said Lhuillier.

Globally, gold has always been seen as a good store of value, evidenced by the fact that people buy gold especially when the local currency is losing value. Whenever a currency loses its purchasing power due to inflation, gold is normally priced using those same currency units, thus its value increases, along with everything else.

”Locally, more and more people have been investing in gold and jewelry. In fact, this is further evidenced by the overwhelming response of agrowing number of jewelry online selling channels particularly in social media including the buying of foreclosed or what is locally termed as “naremata”  items from pawnshops, and then sold via FB Live selling, done by various groups and individuals in the country,” added Lhuillier.

Rematado Sale: A big hit among common Filipino consumers

Based on the actual inventory of Cebuana Lhuillier’s foreclosed jewelry, the number of Filipinos who has been buying these items are growing.  In fact, even during the quarantine period, the number of buyers significantly increased.

“More and more people are now seeing the value of jewelry and gold, for that matter, as good assets to have, especially during times like this. You would be surprised at the types of jewelry being pawned off. Some are even heirloom pieces and sold at very good prices,” shared Lhuillier..

Aside from it being affordable, pawnshops also provide easy accessibility as they remained open all-throughout the quarantine period being an essential service.

Pawnshops also provide easy acquisition options for clients such as a lay-away program as well as a re-pawn scheme.

These “rematado” sales in pawnshops has led to a shift in the perception of jewelry, from being only high value and inaccessible to many, to being affordable and accessible to most.

Clients now flock to pawnshops to purchase foreclosed gold jewelry as most, if not all, major pawnshops practice this, including Cebuana Lhuillier, Palawan Pawnshop, M Lhuillier, Villarica Pawnshop, Tambunting, and RD Pawnshop, among others.

Online Jewelry Selling: A welcome option to the market

Aside from rematado selling in branches, pawnshops have likewise started online jewelry selling and the reception from clients has been quite astounding. It has even unraveled new markets like millennials, who did not used to invest in gold or jewelry previously.

Moving with the necessity of the times, pawnshops are now utilizing the use of social media sites like Facebook to sell rematado jewelry. In fact, as much as 10,000 people have tuned in to previously held FB Live sessions where items are sold out within the first hour.

“This move to enable clients to purchase gold online is very timely since a lot of people are looking to invest on something that appreciates over time, and gold and jewelry is one of them. Social media has definitely made it more accessible for clients, not to mention, safer and convenient for everyone,” claimed Lhuillier.

The wonderful reception of clients to online rematado selling, shows that while retail-based jewelry business is declining because of the current situation, more and more people are now finding ways to acquire and invest in gold and jewelry because of the timely initiative of CPPI-member pawnshops in making use of social media, which has not only benefited them but also their customers.

 
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