In the past 9 months over 60% of Portugal’s ‘gold shops’ have closed due to the tumbling gold price across international markets, according to a report from Golden Broker.
The fall in price from $1,600 per ounce to $1,200 per ounce between March and June 2013, accompanied by increased high street competition, are said to be the main factors that caused these fly-by-night businesses to shut up shop.
João Pinto, a trader at Golden Broker has an explanation for the decrease in sales; “six years have elapsed from the start of the economic crisis, the Portuguese rely less and less on the sale of gold to high street shops as a result of their adaptation to the crisis and their need to consume less."
The buying and selling of gold in Portugal through these high street shops took off quickly as the crisis bit deep.
With the gold price as it is, these shops will continue to struggle and the public will have less temptation to sell off jewellery and family heirlooms at the rock bottom prices offered.
Another plus is that burglars and thieves also will lose a ready outlet for their stolen valuables. Gold shops have also been used by organised crime to launder money and evade taxes on the sale of the gold received.
See also: http://www.algarvedailynews.com/news/601-gold-gangs-busted-in-60-million-fraud-investigation
