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Diamonds

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eggshaped
36911.  Sun Dec 04, 2005 10:42 am Reply with quote

Why are diamonds expensive?

Not because they are rare, though that certainly used to be the case.

In the late 19th century a massive supply of diamonds were found in southern africa, and it is now thought that there could be upwards of 800 million stones mined every year. Some internet sources say that there are enough stones in the world that every person in the USA could own a cup-full. That's a lot of stones, so why are they so expensive?

The answer lies with Cecil Rhodes.

He founded the DeBeers diamond company, which now controls over 90% of the world's diamonds. While the company is notoriously tight-lipped on how it runs its business, it seems to be generally accepted that De Beers deliberately stores a huge majority of its diamonds away, only making a certain amount available to the public, and creating a supply-demand balance which keeps its prices artificially high.

Quote:
In 1947, a maiden lady copywriter at N.W. Ayer, Frances Gerety, created the most durable advertising slogan in history: A diamond is forever. Within three years of creating the 'diamonds are forever' slogan, an estimated 80 percent of wedding engagements in America were consecrated with diamond rings.


http://www.amnh.org/exhibitions/diamonds/trade.html
http://americanradioworks.publicradio.org/features/diamonds/mystique1.html
http://en.wikipedia.org/wiki/De_Beers_Mining_Company

 
iano200
36913.  Sun Dec 04, 2005 10:49 am Reply with quote

did you hear about the swiss or denmark or i cant remember which country they came from but a company will take the ashes from a cremated person and make a diamond for you by compessing it so hard that it turns into a diamond dont know the price but i say over 200 for it

 
gerontius grumpus
36915.  Sun Dec 04, 2005 10:54 am Reply with quote

Yes, I've often wondered about that one.
Diamond is a form of very dense carbon.
The ashes of a cremated person will contain some carbon, but not a great deal.
Why not make it from an uncremated body? Then you could have a really big diamond.

 
Cleverina Clogs
36936.  Sun Dec 04, 2005 12:47 pm Reply with quote

There are companies that will do that - frankly I think it is sick

 
Flash
36964.  Sun Dec 04, 2005 4:57 pm Reply with quote

This is a great topic. I think diamonds are a unique commodity in this respect: the interests of everybody involved (even the consumers) are served by keeping the price high.

Discuss.

 
Gray
36990.  Sun Dec 04, 2005 7:03 pm Reply with quote

There was a documentary a year or two ago that showed that diamonds can now be manufactured to more or less any size and colour in a suitably equipped laboratory. This would leave 'real' diamonds with only the paperwork they came with to show that they were 'genuine' - they would be indistinguishable from 'artificial' ones.

Therefore, the paperwork, including the registration numbers of the stones, is the expensive thing. The information is prized - not the atoms. 'Knowing' they're real is the value. But even knowledge can be faked because that kind of knowledge is essentially down to belief.

I suppose gold must have similar artificially constrained values as well, seeing as how currency is based on it?

 
djgordy
36995.  Sun Dec 04, 2005 7:58 pm Reply with quote

Gray wrote:


I suppose gold must have similar artificially constrained values as well, seeing as how currency is based on it?


No countries base their currencies on gold any more. The UK abandoned the gold standard in 1931 and the USA in 1971. These days gold is just a useless yellow metal*.





*So if you happen to have any lying around just give it to me so that it stops cluttering up your house.

 
Caradoc
36996.  Sun Dec 04, 2005 8:12 pm Reply with quote

Diamond production is monopolised by de Beers which seems to be a quite nasty company to work for here or here & uses its muscle fairly effectively.

I can't find confirmation at the moment but from memory recall a documentary which reported that de Beers once dumped several tons of diamonds into the sea as they had an overstocking problem.

 
dr.bob
37026.  Mon Dec 05, 2005 6:46 am Reply with quote

It seems to be a universal truth that pretty much any multinational, highly successful company will be quite a nasty company, both to work for and (unsurprisingly) to its competitors (or anyone else who gets in their way).

 
eggshaped
37034.  Mon Dec 05, 2005 7:12 am Reply with quote

Flash Wrote:

Quote:
This is a great topic


But something tells me that De Beers would not see it that way. I see a Rolls-Royce-Chickens-style problem.

 
Celebaelin
37586.  Wed Dec 07, 2005 11:56 pm Reply with quote

The best quality diamonds available are described as having colour D. Colour grades A, B and C are theoretically possible but no-one has ever seen them yet.

Quote:
Effect of color on price: In general, as the amount of yellow in the stone increases, the value of a diamond decreases, that is until the fancy color grades are reached, and then the value goes up again. Roughly, for an internally flawless (IF) round brilliant diamond of 1-1.5ct., prices fall about 25% in going from D to E color, and then about 10% more for each additional grade (F=-35%, G=-45, H=-55%) until one gets to H color, where the difference decreases to about 5% less going from H to I color (I=-60%). So the first color decrease from D to E will provide you with by far the largest increment in saving money.


http://www.diamondexpert.com/articles/color.html

 
Flash
37604.  Thu Dec 08, 2005 5:52 am Reply with quote

When I was at university I applied for a job with De Beers. Didn't get to first base, but it sounded like a really interesting gig - they sent their new recruits off as trainee diamond buyers and mine managers in remote parts of the world.

 
Nileus
37705.  Thu Dec 08, 2005 3:45 pm Reply with quote

So, what's so sick about having a small amount of your cremated remains made into a diamond?

 
Jenny
37779.  Thu Dec 08, 2005 8:57 pm Reply with quote

I think having your cremated remains made into a diamond is a fabulous idea.

I like the diamond colour grades - A B C and D, except the first three don't exist. That might have a question in it somewhere.

 
Amie
37967.  Fri Dec 09, 2005 4:56 pm Reply with quote

Quote:
So, what's so sick about having a small amount of your cremated remains made into a diamond?


I think it's rather nice, you can wear your loved one around your neck/ on your finger/ around your wrist for the rest of your life.

Or if all else fails you can pawn it...

 

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