Buying diamonds? Avoid Drew Brees’s $9-million mistake

CBS Marketwatch ^ | April 7, 2018 | Maria LaManga

[DUMBGRUNT]

The rise and fall of diamonds
By Edward Jay Epstein

An enjoyable history of diamonds and De Beers.
Ian Fleming was in it up to his neck!

The author posts his one-time bestseller online for free.
A bit old but not much, if anything has changed.

http://www.edwardjayepstein.com/diamond/prologue.htm

[kearnyirish2]

If it would have had real consequences, he would have really checked this out first...

[oblomov]

With CNBC following every little price change from August through present, there were a lot of momentum traders and dumb-money speculators buying near the peak in December-January. The price had risen to bubble levels, that is, the price overshot value metrics such as transaction volume, etc.

Cryptos like bitcoin and ether went from relative undervaluation in late 2016 to rich overvaluation in late 2017. By falling from the Dec-Jan peak prices by 50-70%, many are now a bit undervalued, so I have started re-entering.

It’s similar to the boom and bust cycles we see again and again in innovation-driven investments like technology and biotech stocks. Market sentiment swings from “this is the future and it’s on the brink of revolutionizing everything” to “this is worthless and overhyped garbage”. The reality is somewhere in between, of course.

IMO: Bitcoin, or ether, or other crypto is not going to replace the USD, and despite the deliberate inflationary policy, it’s useful to have government backed currency. It’s good to have some modest hedges against this inflationary policy, such as precious metals and cryptocurrency. Some stocks are an inflation hedge, too.

In regard to the original topic, I think so-called investment diamonds are a terrible idea as a store of value. The ability to create large synthetic diamonds, including ones with artful and authentic-looking “imperfections”, is improving. The only case for buying investment grade diamonds is for taking large amounts of wealth across national borders without being detected. Although one may have to take a 20-50% hit in value to cash out, the people who do this are willing to take the hit. I personally have no need for this.

[NorthstarMom]

Only six kids for us. We would have loved more, but six is what God has decreed.

I work part time as a waitress-whenever customers hear that I have six kids, they immediately look at my stomach. It’s as though they wonder how they could have have missed something so huge and telling. Then they look up and say no way! Makes me giggle. Very few of the moms of many in our homeschool co-op are heavy. We can’t be-there’s no food ever with teenage boys in the house!

[lepton]

I thought there was something about artificial diamonds fluorescing.

[sphinx]

I have never heard that, but perhaps an expert will be along shortly to enlighten us. My wife is allergic to jewelry so I have never paid much attention to it. One of the great blessings of my life.

[lepton]

Wiki: “Although the GE stones and natural diamonds were chemically identical, their physical properties were not the same. The colorless stones produced strong fluorescence and phosphorescence under short-wavelength ultraviolet light, but were inert under long-wave UV. Among natural diamonds, only the rarer blue gems exhibit these properties. Unlike natural diamonds, all the GE stones showed strong yellow fluorescence under X-rays.”

I think the following is related to non-diamonds, but still interesting:

Also: “Diamond’s thermal conductivity is made use of by jewelers and gemologists who may employ an electronic thermal probe to separate diamonds from their imitations. These probes consist of a pair of battery-powered thermistors mounted in a fine copper tip. One thermistor functions as a heating device while the other measures the temperature of the copper tip: if the stone being tested is a diamond, it will conduct the tip’s thermal energy rapidly enough to produce a measurable temperature drop. This test takes about 2–3 seconds.”