The price of the gold futures hit a record $1,123.40 early during Thursday's trading - confounding market analysts who thought there was no way gold would remain so expensive when it first cracked the unheard-of $1,000 mark last year.

The price retreated a bit later on Thursday to settle at $1,106.60, before rising again yesterday to close at $1,116.70 an ounce.

The remarkable run has implications far beyond savvy investors who hope to profit from the rising price of gold-futures contracts.

In New York's diamond district, for example, more people started showing up late last year to sell their gold, and the crush hasn't let up, said Anthony Iannelli, owner of Iannelli Diamonds.

"They're bringing in jewelry from the '70s and '80s they don't wear anymore," he said. "They're following the news and see prices are high. They realize they have a little cache and want to take it out of the vault."

Typically, gold is a safe place for investors to park their money, not something they buy to make money. It doesn't earn any interest, and because it's always sought-after, its value tends to be fairly stable.

For instance, gold first reached $1,000 in March 2008, shortly after the collapse of investment bank Bear Stearns Cos. Inc. Investors bought it up then because they feared for the stability of the financial system.

This time is different. Investors - think of them as the '09ers - are buying gold to protect themselves against the falling value of the dollar in world currency markets. The dollar has lost about 20 percent of its value in the last 12 months.

Currencies are weak investments around the world because of record-low interest rates. Foreign banks that hold substantial amounts of U.S. debt, such as China's banks, want to diversify their holdings.

The surge has been remarkable. Gold is up 7 percent just this month, and 26 percent for the year. Some forecasters see it going to $1,200, $1,500 or beyond - unless the buying frenzy comes to a halt.

Some analysts, though, are panning the gold speculation.

"You just don't see increases like this over the short term" that last, said Steve Condon, director of investor advisory services for Truepoint Capital in Cincinnati. "This isn't materially different from gambling."

Nevertheless, people across the country are cashing in. More than 100 people a day now come to sell their gold at Ernest Perry's antique and estate jewelry store in Charlotte, N.C., up significantly in recent weeks.

There is another side, of course: The rising price of gold has put a dramatic dent in jewelry sales, already suffering from the recession. Far fewer customers are looking to buy gold jewelry because of the soaring price, Perry said.

He predicted silver would become the primary metal used in jewelry if gold prices were to drive customers out of the market.

For the most part, though, the price rise for gold is still being driven by investors and speculators, not from people who actually want to use the metal. In fact, demand for gold for jewelry and for industrial and dental uses was already falling during the second quarter of this year, according to the latest data available from the World Gold Council. That was when gold was still selling for around $930 an ounce.