When the going gets tough, the tough get going. And when a recession hits, people get to ransacking their attics and closets to see what they can sell.
Today across the country citizens rich and poor are casting a new and appreciative eye on jewelry, paintings, furs and assorted heirlooms, some of which they might have considered as junk not many months ago. But now these items are ending up in pawnshops, as many Americans discover they don’t have enough money to pay for mortgages or groceries.
The newest wrinkle in the pawnshop industry is the surge in upper-income customers. Some of them are executives trying to meet payrolls. Others are formerly well-heeled investors whose hedge funds have collapsed. The scoundrel Bernie Madoff, whose Ponzi scheme bilked his “friends” of billions of dollars, has probably triggered a bigger boom in pawnshop visits than any one person in recent history.
Even so, the upper-echelon members of society are in the minority when it comes to visiting pawnshops. The average pawnshop customer has a household income of $29,000, according to Dave Adelman, president of the National Pawnbrokers Association.
The word “pawn” comes from a Latin word meaning “clothing.” That’s what early customers most commonly used for collateral. The three golden globes that symbolize pawnbrokering stem from three bags of stones used by a Medici pawnbroker to slay a giant. Or so the story goes.
Sometimes an object has a substantial value just because it’s old. You learn that by watching “Antiques Road Show,” the long-running TV program in which people bring their goodies to be surveyed by experts. The common denominator of most of these items is their advanced age.
I’ve never really understood why some objects gain value with age. Adding to the puzzle is the fact that the value of an item may not start climbing until sufficient years have passed. For example, the moment you drive a new car off the lot, it loses 10 percent or more of its original price. This decline in value continues for years. But then when the car’s age reaches the quarter-century mark, its value will start to climb, at least if the car is in basically good shape.
What would you pawn, if you suddenly found yourself strapped for cash? Now may be the time to think about it, before the market gets glutted. My only experience with selling personal possessions came several years ago after my wife’s death, as I prepared to sell my house. Selling old silver, furniture and clothing is a generally grubby experience, and sad, as well.
But not as sad as visiting a pawnshop, for whatever reason. The few pawnshops I’ve entered were filled with ghosts, abandoned hopes and lost dreams. But that’s just my narrow view. For someone in need of a quick loan, a pawnshop can be a godsend, a court of last resort.
We should never look down our noses at pawnbrokers. They’re part of the oldest financial tradition in history, dating back 3,000 years to China. The western hemisphere owes a lot to the pawnbrokers who provided money to Spain’s Queen Isabella when she brought in the crown jewels and said, “My boy Christopher Columbus needs cash to sail off and discover America. What can you do for me?”
