Gilt-free shopping

Now, first stop at mall is often to sell old gold

Amy Mason analyzed the gold content of jewelry being purchased at the Goldrush kiosk at the North Shore Mall in Peabody. Goldrush has set up kiosks in malls from Virginia to New Hampshire to offer cash for gold and silver. (John Blanding/Globe Staff)

PEABODY - Mary Sullivan went to the North Shore Mall recently not to buy, but to sell.

In her coat pocket, she carried a plastic baggie filled with gold necklaces and earrings she had emptied from her jewelry box. And there, in the cavernous mall, surrounded by dozens of struggling stores that would love her business, she cashed in her gold, pocketing $70 and change.

"Times are tight," the 61-year-old Salem resident said. "I've got grandchildren I want to buy for."

Because of the down economy, malls in the Northeast, those vast retail shrines to creature comforts, have welcomed a new business into the mix this holiday season: gold buyers. A Virginia-based company called Goldrush has set up kiosks in malls from Virginia to New Hampshire asking customers to sell them gold and silver - at a fraction of its value - so they can melt it down and resell it.

That means customers can shed lone earrings and unwanted wedding bands or part with heirloom jewelry or family silver in mall courtyards, something routinely done in markets and banks across Europe and in many developing countries. And while the kiosks are a new addition to mall life in America, they are also reminiscent of another era.

"It's certainly something that was done in the days of the Depression," said Brad Ziglar, managing editor of Hard Assets Investor, a website about commodities investing. "We're nowhere near the state we were in the 1930s with our economy, but times are tough enough that some people are looking at the goods that they have and wondering if liquidating them makes any sense."

The mall kiosks are more of a fire sale. Goldrush's rates for gold change daily, loosely based on fluctuating market prices, but customers usually only get a small percentage of the value.

The price of 14 karat gold has generally hovered between $700 and $800 an ounce on the open market. On a recent weekday, the North Shore Mall's Goldrush kiosk offered $10.88 a gram for 14 karat gold, or about $308 an ounce.

Wayland rare coin dealer Brett Leifer scoffed at the prices offered by the kiosks, because "it's not a very efficient way for people to sell their gold."

"People would do better if they went to someone who would pay them more," such as a jeweler, he said.

Gala Andrea Tressler, part-owner of Goldrush and a third-year law student at Northeastern, said she opened the business in New England because the gold business is "recession proof." She called the kiosk's prices "really fair," especially compared with pawn shops. And business has been so good at the North Shore Mall, she recently hired an additional kiosk employee.

"It's just a really nice service," Tressler said. "You walk around the mall and it gives you an opportunity to have some extra spending money."

Tressler has also opened kiosks at the South Shore Plaza and Burlington Mall.

Despite the low rates, many people who traded in their gold at the kiosk in recent weeks said they were surprised that their jewelry fetched so much.

Jennifer Jordan, a salesclerk at Bare Escentuals in the mall, said she brought in her outdated gold jewelry, including an old 14 karat ring with her initials engraved on it and a ring shaped like a lion's head.

"I have so much gold from the 80s," she said. "I used to give it to my daughter to play with."

Jordan got $126, which she said she planned to spend in the mall at the Children's Place.

Eighteen-year-old John Kordis brought a white gold heart pendant he had bought for his girlfriend. She broke up with him before he could give it to her.

The $50 gift got him only $6.20 at the kiosk, which he said was enough to buy two drinks at the mall food court. Yet he was pleased. "It gets rid of the emotional baggage," he said.

Karen Moore, a mother of three from Danvers, brought in a pile of gold. Employees at the kiosk weighed it and tested its authenticity using a solution that changes color when applied to fake gold, then quoted her payout: $218. That money will go to bills and lunch at the nearby food court.

"I'm like, why didn't I do this before?" she said.

Gold prices are rising locally because demand is up worldwide. According to the World Gold Council, a group formed by mining companies, worldwide demand rose 121 percent in the third quarter of 2008.

Many customers buy it in the form of coins or bullion. Leifer said many people view gold as a hedge against inflation and safer than paper money. Gold sales have been so high that the US Mint recently ran out of gold coins.

"When I see a pile of gold coins, it's wealth," Leifer said. "Gold endures. And it's endured for thousands of years."

Sullivan, the grandmother who sold her gold at the North Shore Mall, parted with much gold she had collected over the years this holiday season. She returned to the kiosk three times to sell additional jewelry in late November. A former IRS worker currently on disability, she said she used the money to repair her car and pay a cellphone bill.

She also planned to commemorate the birth of another grandchild by purchasing a gold charm somewhere in the mall.

Megan Woolhouse can be reached at mwoolhouse@globe.com