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Message:: [QUOTE="medoraman, post: 1928709, member: 26302"]Its very common in India and Asia. The gold jewelry market is much different over there. The common occurence is you buy starting at the gold price, and then negotiate the upcharge premium for it being in the form you desire. When you sell they pay you the melt value. This equates into a ten percent spread for decent sized piece of gold jewelry, much better than the 5 cents on the dollar you would be lucky to get in the US. For loans, the shops do the same thing. They will loan you up to melt value, and charge you a reasonable interest rate, (maybe 10%), and a one time pawn fee of around $30. You pick it up in three months or forfeit the item, unless you come in to pay the interest, in which case it can go longer. So, its just a whole different way to view gold over there as here. Its seen as universal stores of value that everyone is very aware of its innate value. Therefor, no one is stupid enough to pay $500 for a pair of gold earrings that only has a melt value of $30, so people never get completely hosed buying jewelry like they do here. I have a friend in Northern Thailand who used to admire the US, but to this day is just dumbfounded how stupidly we buy gold here. A year ago or so she told me she buys about 20 pieces a day, sells about 50 pieces a day, and has about 100 items in on pawn at her main store. I hope that helps in analyzing the revelance of pawning there.[/QUOTE]