Gold parties are gatherings at which people bring gold jewelry and other gold trinkets in order to exchange them with the party’s host for cash. Companies such as My Gold Party LLC facilitate gold party programs, so that individuals can apply to be a gold party host or “rep” and receive kits that include special scales and sensors to determine the cash exchange amount. In recent years, gold parties have been compared to Tupperware parties because they are often held informally at someone’s home, with friends, family and other acquaintances as guests. However, unlike traditional Tupperware parties or similar ventures, guests at gold parties are not expected to purchase any items, but rather to sell their own and receive cash on the spot.
Gold parties first gained popularity in 2007, due to the high demand for extra income resulting from the economic downturn. In addition to companies that host gold parties, companies such as Florida-based Cash4Gold have also taken advantage of soaring gold prices by offering cash in exchange for gold via postal mail. During the 2009 Super Bowl, Cash4Gold increased its profile by running an ad featuring celebrities, Ed McMahon and MC Hammer, who have both endured public financial struggles. Payday loan stores that offer quick cash to customers have also capitalized on the gold selling trend by adding a gold-for-cash exchange to their services.
Gold parties typically follow the same process: each guest has one-on-one time with the host, who appraises, weighs, and determines the authenticity of their gold with a special sensor. The sensor is equipped to determine the karat of the gold, whether yellow, white or platinum. Although gold jewelry with stones is still accepted, there is usually no reimbursement for stones, which should be removed prior to the party if the guest wishes to keep them. Following the party, the gold items are melted down, turned into gold bars, and taken to the bank as quickly as possible, in order to take advantage of the most current gold prices.
Despite the immense popularity of gold parties and other methods of exchanging gold for cash, some analysts warn of a potential dampening effect on future gold prices if the market continues to be deluged with gold.
