By Rajesh Mirchandani

BBC News, California

Please turn on JavaScript. Media requires JavaScript to play. Advertisement In America, record prices are fuelling a new Gold Rush - 160 years after thousands descended on California, seeking riches. With uncertainty in oil and stock markets, gold is seen as a stable investment - it hit a new high of more than $1,000 (£500) an ounce earlier this year and some think there is money to be made once more. "You can pay your bills, if you live meagrely," says John Gurney, who gave up his job six months ago to become a full-time gold prospector. John is standing in a shallow river in Jamestown, California, in the heart of Gold Country: in 1849, the same dream brought hundreds of thousands of people to towns like this. He is panning for gold: he shovels rocks and dirt from the river bed into a bucket, sifts out the bigger pieces, transfers what's left into a ridged plastic panning bowl, and then, using a light movement back and forth, shakes the bowl, separating the lighter material from the heavier, including gold. The Motherlode Each 20-minute session usually turns up a few tiny flecks. "It's not a lot of money," John says, "but it adds up quite a bit... But you never know - you may hit the jackpot sometime." This is the simplest way of gold prospecting. The original 49ers - as they've become known - used this technique, as well as mining. And in the first five years of the Gold Rush those early pioneers extracted as much as £6bn worth of gold, at today's prices. Fortunes were made - and lost - in the wild towns that sprang up almost overnight along 200 miles of central California, an area they called the Motherlode. Tourism is big business in the former gold-mining areas Places like Jamestown and Coloma - which, in its heyday, nearly became California's state capital - have been mining tourists ever since. But now these ghost towns are stirring again, as more and more amateur prospectors try their luck. Brent Shock wears a huge gold nugget as a ring; with his long leather coat and wild eyes, he has clearly seen a thing or two in his 25 years of gold mining. He runs gold-panning tours in Jamestown and says it is busier now than he has known it for years. "You've got a tremendous amount of interest from people now," he tells me, "because gold's at $1,000 an ounce." Buried deep Earlier this year the price of gold broke through the magical figure and it has been hovering between $800 and $900 an ounce since. And there is plenty of gold left in California: it is estimated that the original prospectors found at most 15% of what is thought to be there. After a few minutes' instruction, I panned for gold, sifting through a five-gallon (20l) bucket of gravel. In half an hour I found what Brent estimated to be worth around $30. It seemed strangely uncomplicated, and certainly gratifying. Most of the gold that is left is not so easy to find, but buried deep in the bedrock - modern mining techniques are needed to extract it. However, the high prices it can fetch make it financially viable, and commercial mining claims in California have rocketed 17-fold in three years (from 132 in the first quarter of 2005, to 2,274 in the first quarter of 2008). Many are hoping to cash in, but why are gold prices so high? Near San Francisco, a city that boomed thanks to the first Gold Rush, Mike Dunn recently opened a shop selling prospecting equipment. You can buy anything from plastic goldpans all the way up to floating dredges at $3,400, with long plastic hoses for sucking up large amounts of material from the river bed. An experienced prospector himself, Mike opened the shop partly in response to growing demand from keen amateurs. He says gold offers stability in troubled times. "As our... economic slump, to put it mildly, increases, [gold] becomes [an] ultimate liquidity for people who are comfortable with it," he told me. "It's been a universal form of liquidity since the time of man's first discovery of gold. It's always been useful as money and typically at the higher end of the scale... What's going to happen in two weeks, three weeks in oil, I don't know, but I know gold will be stable. "With gold you can always get a suit and a steak and I think that's important." Glittering past In the studied atmosphere of the What Cheer Saloon in Columbia, Ben the barman wears period costume but serves modern drinks. A sign outside offers sarsparilla (an old type of root beer). All along the main street in fact are shops and signs from a bygone age - Columbia is a living museum to its glittering past. And a couple of regulars are pondering this Second Gold Rush. "It's good for this place because it brings tourism," Pat Narry says. "Tourism has always been gold!" Bob Beck tells me: "Areas have been milked dry but with the rain and the seasons the gold comes to the surface... so they're praying. At $1,000 an ounce, they're praying!" Back at the creek in Jamestown a group from the east coast are trying their hand at gold-panning. Just like in 1849. History is repeating in places like this: many will dig deep, few will make fortunes in California's new Gold Rush.



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