The spike in gold prices this year is inspiring people to sell gold, buy gold, snatch the gold from around other people’s necks, and go out prospecting for gold. Some of the people who operate gold prospecting tours report that business has been surging of late.
If business is surging, the surge is being fueled by people who can already afford to go out looking for gold. Like one couple in Australia who gave up their jobs to be full-time gold prospectors. Such people often report that they’re able to make a good living at it. Other people claim it can be a profitable hobby. But you’re more likely to hear stories like the one by the retiree who says he found about $20 worth of gold in the past year – and how it’s taking him forever to recover the money he’s spent.
It takes money to make money.
If you want to get your hands on gold the old-fashioned way, there are people who will show you how. Prospecting tour companies will take you into the outdoors, educate you about gold mining, and provide a good time – but that’s it. Forget about finding another “Washington Nugget,” the controversial 8-pound hunk of gold – was it found in California or Australia? – that sold for $460,000 at auction in March. That is not going to happen to you, and veteran prospectors want you to know it. (Although you might get lucky.)
What you will typically get to do is a bit of gold panning, the easiest way to look for gold. You’ll need to find a stream to go panning in, preferably one where gold has been found before. What you’ll be doing is gathering gold from placer deposits – accumulations of gold resulting from the effects of gravity during sedimentation. The gold you find in these alluvial placers is what’s been washed downstream from the original vein. The gold accumulates at the base of the deposit, of course, since it’s denser than the sand and other materials.
Gold naturally occurs alloyed to some degree with silver very often (as electrum) or sometimes with mercury (as amalgam) and shows up either as variously sized nuggets, as flakes, or as microscopic particles inside other rocks. The technique involves filling a wide, shallow pan with sand and gravel that you’re hoping contain gold. You submerge the pan in water and shake it in various ways, some unique to the prospector, causing the gold to settle rather quickly to the bottom of the pan.
If you practice this a while and keep at it, you might be lucky enough to find gold and collect some of it. But you’re not going to be able to just weigh it and go get the day’s closing gold price per ounce. The impurities, such as the silver and mercury I mentioned, have to be removed from it first. It’s going to cost to refine the gold, even if you do it yourself (which is generally inadvisable, in fact, as it involves handling some pretty dangerous chemicals).
If you’re like a lot of the people who go out panning for gold, you’re not going to end up selling the gold anyway. Kelly Hall, Vice President of the Coarsegold Prospectors Club of Coarsegold, California, puts it this way: “I’ll probably end up giving it to my grandkids.”