With the economy in decline, and the price of gold above $960 per ounce on February 25, demand for gold is on the rise. It's a big topic these days and one I'm focusing on more and more on Mad Money. So I’m going to spend the next few days here talking about the gold market; how to buy gold, where your best options lie, and how to avoid scams when trading in gold.
Gold has been around for centuries, ever since the first gold coins were made by King Croesus of Lydia around 560 B.C.
I wonder how old King Croesus would have felt about selling his precious currency to an outfit like “Cash4Gold.com.”
These guys are priceless and I certainly don’t want to give them any publicity – at least any publicity that helps them fleece consumers. Cash4Gold should be given a wide berth. Someone who claims to be a former employee, writing on the consumer activism board ComplaintsBoard.com, has penned a vicious screed against Cash4Gold, claiming that the company taught him from day one how to scam customers looking to sell their gold.
While the entire letter makes for fascinating reading, some of the alleged insider’s comments are both frightening and damning. Worse, there are plenty of potential gold scammers out on the marketplace, and we need to weed them out.
Here's what I'm talking about. A recent expose by Channel 10 News in San Diego unveiled the ridiculously low prices people can expect to get from “cash for gold” companies. In the sting, the news station purchased four gold rings for $58 apiece, and then shipped them off to three popular gold and jewelry buyers: www.GoldKit.com, www.Cash4Gold.com and www.GetGoldCash.com. Channel 10 then sold the last ring to a San Diego pawnshop.
Here is how it shook out: