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May 05, 2008 (The Valley News-Dispatch - McClatchy-Tribune Information Services via COMTEX) -- Oil is referred to as "black gold" but even at $116 per barrel, and $3.60 a gallon for gasoline, the value is not even close.

Gold closed on the markets Friday at $856 per ounce and people, some of whom are desperate for money to buy gasoline, are cleaning out their jewelry boxes, according to local businesses who buy gold.

"I had one lady who came in and said she had to sell everything because of the price of gas," said Tom Hunkele, owner of Goldfather's Jewelry in Verona. " It's a short-term thing, I mean it wasn't that much, maybe $150. What will that buy? A couple of tankfuls?"

"People have come down with all kinds of stuff," Hunkele added. "I know they are stretching because they are bringing in anything that looks of value."

Dale Gordon, owner of D.S. Gordon Jewelers in Lower Burrell, thinks that although times are tough for a lot of people, he believes the high price of gold is the lure.

To put the price in perspective, in 2000 gold was selling for about $300 an ounce and that jumped to $600 in 2006. Now it's topped $850 an ounce.

"The truth of the matter is, I don't have a lot of people coming in and selling, not so much because they need the money, but because gold is worth so much more right now," Gordon said. "It's mostly gold for recycling.

"I'm not getting any big, long-treasured family heirlooms that people have held onto."

He thinks desperation selling may be bigger in other parts of the country where the economy is worse.

"This area, in my view, is always, like below the radar," said Gordon, who has owned his shop for 17 years. "That's why we didn't get like the big giant housing crunch. Housing prices went up (here), but they didn't go up like they did in other parts of the country. The prices here don't skyrocket like that so when the prices come down, they don't fall quite as far."

Gordon said people have been bringing in broken items they don't want to fix: jewelry items that are worn out and watch cases that aren't used any more.

I've even had gold teeth," Gordon said. "Some of those are built pretty heavy and worth a decent amount."

Derek Molonor, who buys gold and vintage watches at his shop in New Kensington, said the kind of selling that a gold buyer sees depends on the location. He said in New Kensington there are people who sell items because they are desperate for money.

"I do see some," he said. "In this area, there is always some of that, but right now it is the price that is driving it.

"Mostly it's more modern jewelry, broken chains, things that aren't worth fixing. Sometimes you get people who come in and say a piece is sentimental, but most of it is just common gold pieces."

"This is definitely the most trading of gold that I have ever seen," said Molnor, who opened his shop in 1995. "When I started, $400 was a high price."

Making ends meet

Some people are looking to sell other valuables to make ends meet.

Facing the toughest economic times in decades, more Americans are selling prized possessions online and at flea markers, analysts say. To pay for the higher gas, food and prescription bills, they are selling off grandma's dishes and clearing out attics.

"This is not about downsizing. It's about needing gas money," said Nancy Baughman, founder of eBizAuctions, an online auction service she runs out of her garage in Raleigh, N.C.

The tough economy also has brought down prices on the second-hand market. Resold merchandise online is going for 25 percent to 35 percent below what it commanded a year ago, estimated Brian Riley, senior analyst at research firm The TowerGroup.

At Craigslist, which has become a kind of online flea market for the world, the number of for-sale listings has soared 70 percent since last July. In March, the number of listings more than doubled to almost 15 million from the year-ago period.

Craigslist CEO Jeff Buckmaster said the rate of growth is "moving above the usual trend line." He said he was amazed at the desperate tone in some ads.

Several Pittsburgh-area postings mention medical bills, especially for other family members.

"I really do not want to sell this car because I have waited so long to find one in this kind of condition, but my father's hospital bills must be paid and he does not have proper insurance," reads one posting from Brentwood, near Pittsburgh, offering a 1991 Eagle Talon for $3,000.

Sara Lang, 59, of Natrona Heights sold her family's trailer using fliers last year after her husband had a debilitating stroke. She is fighting his insurance company for rehabilitation care for the former worker at Braeburn Alloy Steel who must use a wheelchair.

Her daughter posted an ad on Craigslist last week, offering their 2002 Jeep Liberty for $8,500 or best offer. Lang has dropped her own insurance and is trying to pay rent and her husband's expensive medical bills on her Social Security benefits and half of his pension, she said.

No saafety net

"I don't feel there's any" safety net for regular people, Lang said. "It's emotional every day. I always worry if another bill's going to come, or if one day my husband's insurance says they've paid enough and aren't going to pay anymore. I'm thinking what am I going to do then?"

On Craigslist, Buckmaster said, three of the four fastest-growing sale categories are tied to gas -- recreational vehicles such as campers and trailers, cars and trucks, and boats.

Earlier this decade, people tapped their inflated home equity and credit cards to fuel a buying binge on such items. Slumping home values and a credit crisis have sapped sources of cash. And soaring gas and food prices have outpaced wage growth.

Josh Smith twice was laid off by tire companies before he found a job on the security force at the 911th Airlift Wing in Moon. Now gas prices are crushing him: His Washington home is about a 40-minute drive from his job and a 30-minute drive from his girlfriend, he said.

He decided he needed to sell one of his guitars and a friend suggested Craigslist. One person was interested, but then stalled, seeming to have their own problems finding enough money to buy, Smith said.

"Looking forward, it gets grim to me sometimes," he said. "I get the fear and the thoughts of the day when we were in (the Great Depression) and documentaries showing people in lines at soup kitchens. I feel like we might end up like that again."

The Pittsburgh Tribune-Review contributed to this story.

Tom Yerace can be reached at tyerace@tribweb.com or 724-226-4675.

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Tom Yerace

Copyright (C) 2008 The Valley News-Dispatch, Tarentum, Pa.

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