Posted on 04/19/2009 9:36:17 PM PDT by JoeProBono
You've heard the stories about gold prices being high (currently $868 an ounce). You've seen the ads to sell back your gold. You might have heard about gold parties where guests sell their gold.
But what about diamonds?
This week, Marketplace reports on the downward sales on diamond jewelry. It is of little surprise that sales of expensive jewelry are down, but why would the price of gold be high, but the price of diamonds be low?
Gold is purchased as a way to protect against inflation. Even if your dollars buy you less, you can hold onto your gold. The dollar value of the gold will go up with inflation while the value of a given dollar drops. One would expect a similar result with diamonds.
Diamonds are not as versatile as gold. While gold can be melted down and reworked into new shapes, diamonds remain whatever shape they were cut into in the first place. And diamonds are hard to value. Unlike gold, which requires only a couple measurements to find out how pure it is, diamonds need to be inspected by experts. The end result is, while diamonds "are forever" just like gold, they are not as convenient and certain. What results is stockpiles of diamonds and fancy jewelry while the gold settings are sent off to be melted down, leaving the gems behind.
So while this might be a decent time to sell gold, it is not a good time to sell your precious gems. There are already more out there than consumers want to buy. But it might not be a bad time to invest in jewelry, especially if you are in a position to, and even more so if you enjoy jewelry. You can get good deals on pre-made jewelry and you may be able to purchase say, a nicer engagement ring than you might have managed a year ago, heavy on the stones and low on the precious metals. It's anyone's bet whether gems are gong to be a good investment on their own, but it's a good time to buy if you're interested.
The Atlanic published a story in 1972 saying that diamonds are basically a gigantic hoax. It’s available on the interwebs.
No, it’s actually worth more uncut. And, yes, it was fun. I wish I had more time I would go more often.
Diamonds can be manufactured for less than it costs to mine them.
Oddly enough, diamond, will make voltage conversion equipment cheaper. That is important for electric cars, a long distance power grid. Also, diamond mining requires lots of energy, compared to growing them.
BOOKMARKED! Thank you for posting this very timely article!
My jewels are safe for awhile longer!;0
Ooooh...love that one. I need that as a poster — where can it be purchased?
I agree. I can't understand why the price of diamonds has not dropped. Obviously, there are powers that do not want that to happen.
Hi Joe,
I’m not sure what your post back to me means.
I don’t know if you mean it seriously or sarcastically.
Please explain.
Buy more ammo? I wish I could. Have you been to the stores lately. Or gun shows? From what I understand there’s not much ammo to buy out there.
Do you have any ideas when or if there will be more ammo available. Will the buying rush for guns and ammo ever calm down some. Will the supply catch up with the demand?
Thanks.
It used to be or still is DeBeers. They had absolute control over the supply and sales of diamonds.
I read a long time ago that diamonds are not really that rare. After all, they’re just compressed carbon, a very comman element.
If it weren’t for DeBeers, the price of diamonds would be $50. a carat.
I could be wrong, I’m no expert.
We haven’t been in the jewelry business for over a decade, but even back then, there were loads of poor quality diamonds on the market. In fact, our dealer, back as far as the mid-1990s, advised us not to buy them unless we had a customer who wanted one and was willing to pay the price and wait for something decent.
We still have a fair amount of semi-precious, some Tanzanite (I love the color) and some sapphire, none of it worth much. The same is true for sterling. Go to sell it and you will get the melt price because it takes energy, equipment and skill to refine it up to fine silver.
OTOH, I have an old Brazilian emerald, great color, few flaws,set in 18kt with a couple of commercial 1/2 carat quality diamonds that I love to wear. It just makes me feel affluent again, for a few hours.
Jewels are an emotional thing. If the economy ever recovers and we defeat the fascists, they may even have real value sometime in the future.
As for gold, it is being manipulated, IMO, by the IMF and the central banks, *balanced* along with their basket of currencies called SDRs. We have some, but haven’t purchased any since it was below $600. I’d rather have a Black and Decker Storm Center hand cranked/solar battery charger and radio and a good water filtration unit at the moment.
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