Gold Buyers Prosper in Crisis-Hit Italy

Times are now so tough that Valerio Novelli, a ticket inspector on Rome’s buses, is planning to sell his old gold teeth.

“I can’t get to the end of the month without running up debts,” said Novelli, 56, who has to support an ex-wife and daughter. “I know I won’t get much, but I need the money.”

In a country suffering from economic crisis, buying gold off desperate people has become one of the few boom industries.

City centres are being transformed as traditional shops go out of business, their signs replaced by ones that announce “Compro Oro”, or “I Buy Gold”.

The Eurispes thinktank estimates the number of “Compro Oro” shops has quadrupled in the last two years. The growth of the industry is “a very good indicator of the level of hardship in the country,” said Gian Maria Fara, the think tank’s president.

“Business is very good, you can really feel the crisis,” said 30 year-old Alexia Messi, who works in Oro Change on Via Medaglie D’Oro in northern Rome. It opened its first branch five years ago and now has seven outlets in Rome.

“People are never happy to sell, but now they come in with anything – gold, silver, old stuff, new stuff. I would say we have twice as many customers a day as we did a year ago.”

Meanwhile, the toll of the crisis is being felt by traditional retailers. In central Rome, Massimo Della Rocca, 57, who has run the men’s’ clothes shop EDEL since inheriting it from his grandfather 30 years ago, is planning to sell up.

“Things have been getting worse for years but now it’s becoming impossible. Sales this summer are down 25 percent from last year,” said Della Rocca, whose garments are all made in Italy from local fabrics. “It’s sad because this shop has been going for eighty years.”


Former Prime Minister Silvio Berlusconi, who was brought down by an escalating debt crisis in November, liked to claim that with restaurants still full and Italians buying as many electronic gadgets as ever, there was little concrete evidence of economic downturn in Italy.

But the proliferation of pawn shops, with an estimated annual turnover of 7 billion euros, is a very visible sign that for millions of Italians life has changed for the worse.

The euro zone’s third largest economy has been in recession[cnbc explains] for a year and shrank at an annual rate of 2.5 percent in the second quarter.

There are an estimated 28,000 “cash for gold” outlets in Italy, according to Gianni Mancuso, one of six centre-right lawmakers who last month presented a request in parliament for the government to regulate the sector more strictly.

Several recent shootings in Rome have involved owners of Cash for Gold outlets. Parliament has discussed evidence that the sector is being taken over by mafia groups.

“They are all crooks, they shouldn’t exist,” said Valeria Arcidiacono, a 46 year-old single mother whose teenage son took and sold her gold and pearl earrings at the local pawn shop.

“They were worth 1,000 euros and they gave him 42 euros for them, with no receipt or anything,” she said.

Ranieri Razzante, head of Italy’s anti-money laundering watchdog AIRA, said pawnbrokers had “virtually taken over from banks” as a form of financing for Italian families, as crisis-hit lenders are increasingly reluctant to offer credit.


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