Are You Pawn Shop Ready?
The pawn shop is probably the last place you want to go if you find yourself strapped for cash. But an interesting article in a Filipino publication reveals a problem millennials face if they find themselves in a cash-crunch. They may have a harder time liquidating assets than their parents because they primarily spend their money on electronic gadgets and don’t tend to buy gold.
The head of one of the Philippines largest pawnshop operators told ANC’s The Boss that gold can be pawned at much higher prices than smartphones, laptops, and other electronics.
There’s nothing like buying gold and using it. It’s a great tool to use to save. Millennials today, they buy their gadgets, their Androids, their bags, but there’s still more value in buying gold jewelry than buying all those.”
While pawning your stuff is certainly not the best way to manage your finances, the article underscores the value of owning gold. It’s a liquid asset that can provide quick access to cash, or even be used directly in barter when times get tough.
In countries like the Philippines and India, gold serves as a vital economic safety net. It functions almost like a savings account. People buy gold to store their wealth and then tap into its value during financial emergencies.
In India, gold plays the role of an economic equalizer in a society that still does not afford women equal rights. Owning gold provides a vital economic lifeline for Indian women, particularly because it allows them to gain access to cash, and even goods and services, during difficult times.
Owning gold can also be a lifesaver in the event of a collapse of the financial system.
Greeks had their access to cash severely restricted during their country’s recent economic turmoil. It got so bad, a robust barter economy developed out of sheer necessity, as everyday Greeks had to find ways to cope with cash withdrawal limits and currency shortages.
Earlier this year when the Indian government launched a demonetization scheme. The idea was to push Indians into putting their hoarded cash in the bank – thus bringing it “out of the shadows.” The demonetization policy resulted in severe cash shortages in some areas of the country. Many Indians skirted the government scheme by using their black money to buy gold. When everything else collapsed, gold was there to save the day.
Obviously, you want to try to avoid getting into tight financial spots. And you may never use a pawn shop. But that doesn’t mean you shouldn’t be “pawn shop ready.” Owning gold can serve as a vital lifeline. There are safety and security in the yellow metal, even in more developed economies like the US. After all, you never know when things might suddenly fall apart.
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Photo by Kim Traynor