Today gold prices are increasing day by day. Fear of financial collapse has enhanced gold's glitter, with prices soaring more than 300 percent the past decade, including 30 percent just in the last 12 months. And just as strong U.S. real estate prices a few years ago created a burgeoning ecosystem of entrepreneurs exploiting that bubble, gold's surge has led to a new crop of prospectors seeking gold and the business around gold.
Let us see in the past .One is Mark Franklin. About four years ago, Franklin, 52, watched a television show on treasure hunting and decided to try his own luck at gold prospecting. The Dayton electronics technician had never prospected before, but he saw a future in the precious metal—a world awash in debt could trigger inflation and a robust outlook for gold, a so-called "hard" asset that typically rallies in times of economic distress. Gold is now about $1,209 an ounce, near the all-time high of $1,266 per ounce in June. Plus, Franklin says, the quest for gold was a good excuse to get outdoors. He discovers about $50 worth of gold, in flakes and larger pieces called "pickers," on an average day prospecting in Ohio or on longer trips to Idaho, Alaska, Michigan, and Georgia. His total take? Just more than $4,000.
Franklin is far from a lone prospector. "Every time the gold price goes up, our membership increases," says Jinny Iodice, customer service manager at the Gold Prospectors Association of America, a Temecula (Calif.) group that provides forums and outings for recreational miners. There have been plenty of new members: The association's membership jumped 93 percent in 2008, followed by a more modest increase of less than 10 percent so far this year, as the gold bug infects more recreational miners. The GPAA has more than 62,000 members nationwide.
Just as past gold booms produced incredible wealth for some, however, far more of those seeking to strike it rich went bust. "When you see such a dramatic move, the tail end almost becomes hysterical," says Gus Sauter, chief investment officer at Vanguard, comparing today's gold rush with the Internet boom of the late 1990s. "People who threw caution to the wind are still scrambling." In the past, gold has done well when U.S. Treasuries yielded less than the inflation rate, which is not the case right now, according to Paul Kasriel, chief economist at Northern Trust. But "markets are weird," he says. "Why did people keep buying houses when it was pretty clear house prices were going to fall?"
But "gold is real money," says Gerard Adams, president of the National Inflation Assn., a year-old group in Fort Lee, N.J., that seeks to warn about hyperinflation, which it considers inevitable. In Adams' view, the price of gold has not yet peaked.
An Adventure Trips
Gold is also used for business activities. Many companies are banking on that. Three years ago, Terry Soloman decided to turn his lifelong passion for prospecting into a formal business with Arizona Gold Adventures in Congress, Ariz. Soloman gets two types of customers: families wanting an outdoor vacation and individuals serious about prospecting. With his children out of the house and the price of gold rising, Soloman turned the recreational prospecting trips he had taken for some two decades into a formal business. Now he has about 400 visitors a season. The average customer finds one to two grams, says Soloman, but some get even luckier. "You've got other people who walk away with several ounces," he said. "You've got to have a little luck."
Lucky or not, Soloman says everyone leaves with legitimate prospecting skills for his $349 daily fee. Those wanting more serious skills now make up about 40 percent of his business, double the number before gold surged, Soloman said.
The California Gold Rush (1848–1855) began on January 24, 1848, when gold was discovered by James W. Marshall at Sutter's Mill, in Coloma, California.[1] News of the discovery brought some 300,000 people rushing to California from the rest of the United States and abroad.[2] Of the 300,000, approximately 150,000 arrived by sea while the other half of them walked 1,500 miles (2,400 km) overland.
The early gold-seekers, called "Forty-niners" (as a reference to 1849) traveled to California by sailing boat and in covered wagons across the continent, often facing substantial hardships on the trip. While most of the newly arrived were Americans, the Gold Rush attracted tens of thousands from Latin America, Europe, Australia, and China. At first, the prospectors retrieved the gold from streams and riverbeds using simple techniques, such as panning.
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