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Nov 07, 2009 (The Blade - McClatchy-Tribune Information Services via COMTEX) -- There's a gold rush of sorts going on right now, but not with pick axes and dynamite.

Instead, consumers struggling through a moribund economy are rushing to jewelry stores to cash in unmatched earrings, out-of-style necklaces, and old gaudy bling now that the price of gold has hovered near $1,100 an ounce.

"I think it's a sign of the times," explained Ali Cheaib, president of Azure Jewelers in West Toledo, "with unemployment the way it is, with jobs scarce, it's a good time to sell jewelry."

The price of gold has been rising steadily for several years, primarily in its role as an historic hedge against currency inflation. In early 2001, gold was trading for under $300 per ounce.

Yesterday the precious metal closed just under $1,100 an ounce, up more than 266 percent over that period, while inflation has risen just 22 percent.

But while the price of gold has risen, demand for the metal has fallen in many sectors -- such as electronics manufacturing and dentistry -- while its demand as an investment vehicle has risen sharply, according to the World Gold Council, an industry advocacy organization.

Local jewelers say they've seen a definite increase in the number of people coming into their stores interested in selling off old jewelry. They attribute some of the increase to continued dour economic conditions in the area, but they also said the historically high price of gold is contributing as well.

"People are seeing [the price of gold] in the news and starting to go through their jewelry boxes and bringing in things," said Ed Szymanski, owner of Estate Jewelers in Sylvania. "Before, we just got people coming in to pay their rent or stuff like that. Now we're seeing more affluent people coming in and clearing out their jewelry boxes to cash in on the price."

Jewelers, in general, will pay about 80 percent of the market price for 24 karat "pure" gold, Mr. Szymanski said. If a piece of gold jewelry has value beyond just its gold content -- if it is historic, for instance -- jewelers might pay up to 200 percent of the market price of gold for a piece. By way of comparison, many of the "mail in your gold" advertisements in the media offer 10 to 25 percent of the market price, experts said.

Not all gold being sold back to jewelers is created equal, said Jim Jensen, owner of Jensen Jewelers in West Toledo. Lesser karat levels include hardening additives that don't count when the gold is weighed for sale, he said. Eighteen karat gold is only 75 percent "pure" gold, and 14 karat is 58 percent "pure" gold, he said.

Contact Larry P. Vellequette at:

lvellequette@theblade.com

or 419-724-6091.

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Larry P. Vellequette

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