The business of the gold in the crisis
03-01-2009 golden marketThe refinery, close to the Lake Lugano in the Alps, is working day and night, because the people worried by the recession worry to turn his assets into something that his value preserves. “It has been 30 years since I am in the business of the gold and I have never seen anything equal. The production has increased dramatically from the middle of the year and we do not give supply opposite to this demand.” there says Bernhard Schnellmann, service manager of precious metals of the refinery Argor-Heraeus, one of the biggest three of the world.
The golden ounce came to a record for 1.030,8 dollars on March 17, 2008, then to fall down at least of 700 dollars at the end of October, now the ounce quotes to almost 900 dollars.
The explosive for new rise can be the weakness of the dollar, which does to the cheapest gold for those who have other currencies, and also the distaste to role assets, because the Governments and central banks have injected big cash quantities into the economy stimulating the inflation.
The smoke goes out while the ruined gold is spilled as if it was an incandescent butter.
To cool it, a worker throws water that evaporates to the contact. Once hardened in the molds, the golden ingots are recorded by a stamp of the refinery. Workers with white gloves pile up them in boxes as dominoes pieces.
Although Switzerland is not a mining nation, it is a hearth of some of the biggest refineries, and it is anticipated that it processes 40 % of all the abstracted gold.
Argor-Heraeus, partly property of Austrian Mint and of a daughter company of the bank Commerzbank of Germany, says that it processes approximately 350 to 400 tons of gold and 350 tons of silver a year for central and commercial banks, his principal clients.
The clients who want to buy golden bars, which can weigh more than 10 kilos each one, must wait nearly one month, bearing in mind the period of holidays of end of year.
For whom they are interesting buying coins or ingots, which fit in the palm of a hand, the delay is 6 to 8 weeks.
One year ago these small products were delivered in a few days.
The worry for the health of the international financial system has encouraged the world demand for pure gold, says the Council of the Gold.
“Many people are afraid to leave his money in the banks. It is difficult to measure, but he would say that our profitability in the last three months undoubtedly has doubled, compared to the three previous months.” there says Sandra Conway, general manager of ATS Bullion in London, that it sells precious metals and golden coins to institutions and on the retail market.
Click to Buy Gold in London Bullionvault
Other Swiss refineries also say that the business of the gold is in heyday.
“From the summer of 2008 we have perceiving pronounced rise of the demand for certain golden products. The one kilo bar has become very popular. The people who usually bought certificates now want pure gold.” there says Fiorenzo Arbini, who is in charge of health and safety in Pamp, another big Swiss refinery.
Schnellmann says that the smelting Argor-Heraeus is operating to any machine, with three shifts from 8 hours until the day. To face to the orders with more personnel hiring is difficult, because every candidate must spend a safety test.
The golden refineries settled in Switzerland to supply to the clocks industry and, then, to the jewelers in Italy. The big Swiss banks intervened to fill the gap in the commerce of the gold when the market of the metal of Londrés closed after the Second World war, and again they did it during a brief suspension in 1968.
The ex-Soviet Union, another big golden producer, chose to the banks of Zurick to handle big part of his golden operations in the decades of 1970 and 1980.
“The gold has the image of being assets of last resource. It can seem antiquated but this way many people think with a lot of money”, says Stephen Briggs, a strategist specializing in metals of Global RBS Banking and Markets.
Golden touch
India, China and Middle East keep on being the biggest golden importers, principally for jewels. But the demand of solid gold has gone off also in Europe, according to the Council of the Gold.
In Switzerland, country of the biggest industry of banking deprived of the world, the demand of bars and golden coins increased in six times to 21 tons in the third trimester of 2008, more than in any other country of the world.
The retail investment in gold increased 121 % in the third trimester of 2008, an important contribution to the rise of the world demand, as he says the Council of the Gold. In this period, the retail investors, who often buy by means of commercial banks, acquired almost 60 more % of golden bars, principally in Switzerland, Germany and the United States.
There was a sudden increase of the interest between professional investors shortly after in September it caused the investment bank Lehman Brothers to collapse. The private bank Julius Baer threw in October a fund that he invests exclusively in golden bars kept in safety vaults in Switzerland.
“The fascinanción with the gold has been there from the beginning of the civilization.” Schnellmann says.
03-01-2009 Reuters
