Steve Duke Presents Tradio Gems: Gift Giving Primer
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Steve Duke: Everybody is going to start thinking about Christmas shopping and I wanted to give you the beginning of your primer on things to look for, things you should know when you are out there shopping, and some of the terms you are going to hear.
We talk to a lot of our consumers. Some of them are younger and some are older shoppers, but they are not familiar with a lot of the terminology that we use. Well, if you are in the business, we use it all day long, day in and day out, and we just assume that a consumer is going to understand what we’re talking about.
Sometimes we have to sort of step back and realize they don’t understand what we are saying, and we have to explain it to them. I am certainly as guilty as everybody else out there. If someone is talking to us about something that is foreign to us, we are not going to stop them in the middle of their shtick and say, “Hey, I have no idea what you’re talking about. Can you explain that to me?”
If I get some of these computer guys coming in and they are explaining to me what is wrong with my computer, all I know is that it is frozen up. I can’t get into it; I can’t get out of it. Fix this thing.
They start with, “You know, Steve, this is such and such,” and I go, “I don’t have any idea what you’re talking about. You can explain it a little bit to me because I guess I should know what went wrong,” but most of the time it is just human nature. We don’t ask; we don’t want to share the fact that we don’t have that knowledge.
I am going to try to give you a little bit of knowledge today. A little bit of knowledge is a very scary thing. A lot of knowledge is good; with a little bit you can get yourself in trouble. However, this is going to get you by as you do your Christmas shopping.
One of the things you are going to see an awful lot of this year is sterling silver jewelry. When I say “sterling silver jewelry,” what am I talking about? It is the same thing as if I said “silver jewelry” to you or if I said “silver” or if I said “white metal that’s not gold.”
We talk about sterling and sterling goes all the way back to the 12th century, back to a band of Germanic artisans who worked with silver. The king of England turned around and said, “I want you to make our coinage for us, but we need something that is going to be uniform. We have all kinds of coins coming from all over the world that are traded with us.” England was a large hub of civilization.
“We need to have some sort of uniform type of coinage.” As the lore goes—it is not really recorded (this is one of the stories I believe)—they began making coins out of silver. If they used pure silver, it was too soft. It would dent; people could wear a little piece of it off; they could shave it down and take some of the silver. Therefore, they alloyed it with copper and they made it basically 92.5% pure.
That standard became the standard for pretty much all of civilization when they started making coinage, whether it was South America; whether it was the New World; whether it was Europe. The standard for silver coins was 92.5% pure.
The people of this Germanic tribe were called the Easterlings. Later on, through time it was shortened to “Sterling,” so the word sterling basically came from the word “Easterling” and it means that it is 92.5% pure.
When we say “sterling silver jewelry,” this is jewelry that is made out of silver and on the inside you will see the word “sterling.” This is synonymous with 92.5% pure. In the case of Tiffany’s, many times they mark on the inside of their jewelry— they even use it as a design on the outside of some of their stuff—the digits “925.” Again, this supposedly means it is 92.5% pure.
We buy a lot of old, broken silver jewelry. Even with some of the other jewelry we buy we see that, unfortunately, over the years many manufacturers have turned around and when you send their stuff to the refinery, generally it will come out anywhere between 85% pure and about 91% pure. It never seems to come out as an assay of 92.5% pure. When we look at this word “sterling,” in our mind we have to try to believe that it is going to be 92.5% pure.
Why are we seeing so much sterling jewelry this year? For one thing, sterling or silver is about $33 an ounce right now. Gold is around $1,725 an ounce. Well, that is certainly going to make a big difference on what you are purchasing your jewelry at this year.
For a manufacturer to supply all these different stores all across the country, for them to turn around and buy all of this gold to make their jewelry with, it is an awful lot of outlay. If they were going to turn around and do the same thing with silver, you could wind up with an awful lot of silver for $1,000. For $1,000 in gold you are just going to wind up with a little piece, a little hunk. This is why you are going to see a lot of silver jewelry.
Now I’m not throwing stones; I’m not saying anything good or bad. I’m saying it is really not from my store because I don’t want to get things mixed up. You will find a lot of sterling silver jewelry now with diamonds set in it.
They are not setting beautiful, large, shimmering diamonds in this stuff—although I bought a ring with a half-karat diamond it in which kind of blew me away. You will see little diamond tennis bracelets; you will see a lot of earrings and things like that.
They make the same thing in white gold; they make it in yellow gold. It is the same style, but they make it in silver now. When you look at it, one pair of earrings is $299 and you look at the same pair of earrings in white gold with the same amount of diamond weight and it is somewhere around $800 or $900. I can see where you can save a lot of money buying the sterling silver.
What are the pluses? You save a lot of money. What are the negatives? If you have a lot of acid in your system, that silver is going to tarnish continuously when you are wearing it. It is going to turn a funky color; it is going to get a brownish-blackish tinge to it. It can be dipped in silver cleaner and cleaned, so is it a big deal? No, it isn’t. It is just that you need to know this is going to happen.
Silver is more malleable than gold. When I say “malleable,” I mean it is not as strong; it can bend; it can be shaped easier than gold. This means you are probably going to wind up losing some of the diamonds out of your silver jewelry a lot quicker than you will out of your gold jewelry. Will it happen? I’m not going to say it is going to happen today or tomorrow. However, it can happen, and the silver is much softer, so the possibilities of it happening are far greater if it is in silver jewelry.
It is much more affordable and there are lots of people who are going to enjoy it. I have a large selection of sterling silver jewelry in right now from Italy. It is all diamond cut. When I say “diamond cut,” this is another term you are going to hear. It means they actually take a burr or a type of a drill and they put facets or little cuts in the silver jewelry to make it shimmer like a diamond. It is really, really pretty stuff. It is all high fashion. It is more expensive than a plain piece of silver jewelry, but it is going to last.
A lot of it is platinum plated or it is rose gold plated or yellow gold plated. It looks like gold. It has the diamond cutting; it shimmers and it is beautiful-looking jewelry. Again, it is more affordable than if I showed you the same thing in 14 or 18-karat gold.
This is something you are going to look at and when people say, “This is sterling jewelry,” now you are going to understand what they are showing you.
You are also going to encounter a lot of gold this year. How do we determine the price of the jewelry? How do we determine what it is? Is it by the gold content, by the designer, by the weight of it?
Well, let’s talk about the purity of gold. When you see these shows on television where these guys are at the gold rush and they are getting gold out of the ocean and out of Alaska and things, most of the gold you will see there can be from 24-karat gold, which is the highest purity for gold, all the way down into the 70% region depending on where the gold is from. In a lot of countries, their gold is higher purity than other countries.
When you look at jewelry, the least expensive way to buy jewelry would be if you were buying 10-karat gold. When we say “10-karat,” what does that actually mean? It means that 41.7% of that jewelry is composed of gold. The other 59% or 58.3% is an alloy. When I say “an alloy,” this could be copper, silver, nickel; it could be a lot of different things that they bond with the gold.
There are two reasons they do this. One, if there is less gold, it is going to cost less money. For instance, you look at a chain. You put it on a scale and, let’s say, it weighs an ounce. It is made out of 10-karat gold. We take the same chain that weighs an ounce and it is made out of 14-karat gold. They weigh the same. It is like the old thing, “What weighs more, a pound of feathers or a pound of lead?”
The difference is that the purity of the gold is less in the 10-karat. It is going to be a little harder, so it will wear a little better. We find a lot of men’s jewelry made out of 10-karat gold and we find a lot of women’s birthstone rings made out of 10-karat gold. It is a ring they are going to wear all the time. The 10-karat gold takes a little bit more abuse and it is able to hold the stones in a little bit more securely without putting as much gold, without putting as much weight into that particular piece of jewelry.
Again, as with sterling silver, the manufacturers supposedly are using 41.7% gold. In your 10-karat gold, usually it is going to come out somewhere from 36% to 38% pure. It usually doesn’t come out as it is supposed to. Basically, all the purity in this gold, when it goes to the refinery, it usually doesn’t come back as what it is supposed to be.
Why? It might sound stupid, but if you are a manufacturer, you can save 1% or 2% in the purity of the gold you are using in the course of a year. Let’s say you use $3 million worth of gold in the course of a year manufacturing your product. You can save 1% or 2% and it goes into your pocket as a manufacturer. You are making a lot of extra money and the consumer doesn’t have any idea he is losing it. This is why you will find a lot of under-karated jewelry out there.
How do you tell what that jewelry is made of if it is marked “gold?” Well, on the end of a bracelet or a chain, usually there is a thing we call a tab. That tab is a little plate of gold, and on that plate of gold you will see 10K. That means 10-karat. You might see a 14K or 18K. That is the American marking for the karat gold you are looking at. It could be 10, 14, or 18-karat gold.
On the other side of that tab, depending on where that piece of jewelry was made, there could be a European marking. A lot of the gold we get is from Italy. Many manufacturers, in order to trade in Europe, have to use a different identification mark other than just the 10K, 14K, or the 18K that we use. By law, they have to show the percentage of gold in that particular piece of jewelry.
If it is 10-karat and you flip that tab over, you may see on the other side .417. That tells you it is 10-karat gold. If you flip it over and you see the 14K on one side, on the other side you may see .585. This is because 14-karat gold is theoretically 58.5% pure gold. Again, the rest of it is an alloy of some sort.
If you see the number 18K, this shows it is 18-karat gold and, again, on the other side of that tab you are going to see 7.50.
Sometimes on the clasps you will see this. When you see these lobster clasps, they are made in Europe; the manufacturers are in Europe. If they are in America, a lot of times they ship their clasps to Europe. Rather than seeing these 14K, 10K, and 18K, many times you will just see the percentage of gold in it. You will see the 417 mark or the 585 or the 750 mark.
I have had people come in and say, “This isn’t gold. It doesn’t say 14-karat on it.” You show them, “See this 585?” and they say, “Oh.”
If you do not understand something, don’t be afraid to ask. If the person you ask does not know the answer, be afraid to shop there. Why would you buy a product you are not familiar with from someone who is not familiar with it either?
I go back to the old adage, “Last week they may have been selling shoes, and now they are buying your gold or selling you jewelry.” They have a great personality, but they don’t have any knowledge. If you really want to know what you have purchased, deal with somebody who has been doing it for a long period of time.
In our store with all my sales people who have been with me for years, we have well over 100 years of combined experience. Deal with someone whom you know knows what he is talking about. You are going to be a lot safer.
How should you buy your gold? Well, if you go to the mall, you are going to buy it right out of the showcase. It has a price tag on it, but you don’t know what you have bought.
If you come to Westchester Gold and Diamonds, we are going to have probably a hundred times more selection than anybody at the mall. Let’s say you want a chain. We don’t have one chain to show you. We may have 30 different chains in the price-range you want.
You may see a chain that you really love, but it is pretty big and it is $200 or $300 more than what you can afford. Well, if it was in 14-karat and we had that same chain in 10-karat, a lot of times we can go over and find you a very similar chain in 10-karat. We can put it on a scale and, because you are buying 10-karat as opposed to 14-karat, you are able to get a much better buy on it.
We sell all of our gold by weight. It is like going to the meat market. You know what you’re buying. It is right in front of you and you can see it. Always check to make sure we do not have our thumb on that scale, just as the butcher used to do. We try to keep our thumbs off the scale when we are weighing our gold for you.
If you have purchased from us before, we will always take that back on a trade. Generally, as long as it is in the same kind of condition as you bought it, we will allow you what you paid for it. Where have you ever gone where they do that?
Maybe you bought a piece of jewelry at one of the malls and it was broken and too expensive to fix. Bring it in. We will throw it on a scale, buy it for the gold content in it (because we are going to melt it down), and you can use that just like cash. You have never walked into the mall and said, “Hey, will you take my broken jewelry?” and they look at you like, “Yeah, we’ll take it and throw it into a trashcan for you.”
We’re not going to throw it into a trashcan. We are going to take it and give you cash for it, or we are going to give you a store credit where you can trade it for another piece of jewelry.
These are some of the things you want to think about as you shop. One other thing you are going to run into this year is platinum. People say, “Why is platinum so expensive? It is selling right now for about $100 cheaper than gold, but all platinum jewelry is expensive.”
The very simple answer is this. When you are buying the gold that is alloyed with another type of metal. You are not buying pure gold. You are buying 40% gold, 50% gold, or 70% gold. When you are buying platinum, platinum jewelry is going to be at least 90% platinum.
Generally, what they do is alloy it with 10% irridium which means it is easier to work with. It melts a little easier with the irridium in it. It is easier to form; it is easier to cast; it is easier to work with. It is not as brittle.
If you are buying an ounce piece of jewelry with platinum, then you are getting about 90% pure platinum in that ounce. If you are buying an ounce of 14-karat gold jewelry, you only have 58% gold. Of course, it is going to be less money proportionately than the platinum.
This is why you will find the platinum is more expensive. First, it is a lot harder to work with if you are a manufacturer, an artisan. Second, you are getting a higher percentage of the metal content.
Why do some people want platinum? Have you ever worn jewelry and you take your ring off and you have a black mark underneath your finger? You say, “That guy ripped me off! This isn’t gold!”
It is gold, but what you have is what we call “gold smudge.” You have a high acid content in your body and it reacts to the alloys in the gold. What happens? There is a chemical reaction going on here and you are depositing some of that reaction on your skin. Again, we call this gold smudge.
How do you get away from that? If you have worn 10-karat gold and it does that to you, you might try going to 14-karat gold with a higher content of gold and less content of alloy. Many times this will prevent that gold smudge.
If you have worn 14-karat, then you want to go to 18-karat gold; the higher the purity of the gold, the less likelihood of gold smudge. If none of that works, you can go to platinum, a white metal. It is not yellow, so you may not like it because it is not yellow. However, we can actually gold-plate over the top of platinum so it looks like gold. Platinum is pretty much inert. This means it won’t react to the acid in your system.
A lot of times people will come in and say, “You know, all of a sudden it seems like my jewelry is changing and I don’t know why. What do you think is happening?”
I say to them, “Are you on any kind of new medication?” and they say, “Yes, I am.”
I say, “Well, the medication has changed the acidity of your body.”
A lot of people say, “All of a sudden this stuff is changing,” and I tell them, “What do you eat?”
“Well, I don’t know.”
“Have you changed your diet? Are you taking in a lot more citrus because you want that Vitamin C?” and they say, “Yeah.”
I go, “Well, you’ve changed the acid.”
The other thing is if you eat a lot of tomatoes; you eat a lot of Italian food, going for the pizzas and stuff. There is acid content in tomatoes and it is going to change the acidity of your body. We have to look at all the different things that are going on in your body if you wind up with that gold smudge.
These are a couple of things we have to look at and anticipate. These are things you might want to start thinking about when you go out there shopping for jewelry.
I am Steve Duke, the owner of Westchester Gold and Diamonds. This is the beginning of your Christmas primer. If you have questions about jewelry, what you should be looking for this Christmas for your loved one, stop by and see us. We are in the Baer Plaza behind ABC Liquors in Port Charlotte. We are always happy to sit down with you and give you some information. We can show you what is available.
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Have Questions about your antiques, estate jewelry, collectibles or old treasures?
If you have questions for Steve Duke to answer about your jewelry, antiques or collectibles, just send a photo of the item and your question directly to Steve Duke at WGDiamonds@HotMail.com and Steve will research it for you and you may be contacted to participate in an upcoming Tradio episode. Be sure to include your name, email and phone number along with your question and email it to: WGDiamonds@HotMail.com