Guys -- Thinking Of Gettin' Engaged? DON'T GET SUCKED INTO BUYIN' A DIAMOND!
AbortedBaby
likely to find. But how can you know?
Remember the old warning about MARRIAGE? "The fuckin' you get is not
worth the fuckin' you get"?
Be warned.
=================
"Five myths about diamonds"
By Tom Zoellner
Sunday, July 4, 2010; B03
DIAMONDS, the ads say, are forever. Whether or not that's the case,
diamond jewelry is a powerful symbol of status and love, and a $72
billion-a-year retail business worldwide. Diamonds can also be a key
source of funding for violent conflicts in Africa. A series of wars
bankrolled by "blood diamonds" in the 1990s prompted the United
Nations to pressure De Beers and other jewelry industry giants to set
up a program known as the Kimberley Process Certification Scheme to
track the origins of each stone and assure customers that their
diamonds are free of the stains of war and misery. But late last
month, a four-day Kimberly Process meeting in Tel Aviv foundered over
the question of whether to approve the export of diamonds from the
Marange fields of Zimbabwe, where torture and murder go unpunished and
profits fund the repressive party of President Robert Mugabe.
How did these glittering shards of compressed carbon become such a
profitable business in the first place? The answer, it turns out, is
complicated -- and many of the things we believe about diamonds aren't
exactly true.
1. Diamonds are rare.
Although you won't stumble across a diamond while digging in your
tomato garden, they are far more common than their cost suggests. The
big gem companies aggressively control the supply that arrives at
market, creating artificial scarcity and high prices.
This practice was born in the diamond fields of South Africa in the
1880s, when Cecil Rhodes, the chairman of De Beers Consolidated Mines,
discovered that he could inflate prices at will simply by locking up
the rights to every diamond mine he could find. His successor, Ernest
Oppenheimer, developed a complex network of wholesalers that gave De
Beers effective control of up to 90 percent of the world's rough-
diamond trade through most of the 20th century, as the company hoarded
stones in basement vaults and doled them out strategically.
The Oppenheimer family's iron grip on the global supply chain fell
apart in the 1990s when Alrosa, a diamond company owned by the Russian
government, and the Argyle Diamond Mine in Australia began to sell
their stones independently. De Beers's share of the rough-diamond
trade is now 40 percent and falling.
Interestingly, though, the end of the De Beers monopoly has not led to
aggressive underbidding: Everyone involved seems to recognize that
price wars could kill the diamond goose. And stockpiling still
happens. Although a healthy 163 million carats or so are mined
annually, a certain amount of that yield is withheld from the
marketplace. Alrosa, in particular, sold a substantial percentage of
its diamonds to a metals bank in 2009 rather than risk flooding the
market in shaky economic times.
2. We've solved the problem of "blood diamonds."
Not really. The Kimberley Process has always been more like a low
brick wall than a prison fence. It soothed the public and stopped the
most timid criminals, but those who want to skirt it can easily find a
way. The most frequent scam is to move diamonds across a border and
have them relabeled. To take one example, the human rights group
Partnership Africa Canada has shown that Guinea exports far more
diamonds than it could hope to produce. The stones are coming from
somewhere else, highlighting the strength of smuggling and money-
laundering networks that could be used to transport blood diamonds
should another war break out in the region.
In some cases in which smuggling was too blatant to ignore -- as in
the Republic of Congo, the Ivory Coast and Venezuela -- the Kimberley
committee took years to respond. When it finally investigated, it did
so with an eye toward appeasing the host governments rather than
cracking down on core problems.
Another weakness of the Kimberley Process is that it does not have a
comprehensive definition of "conflict." It has thus ignored multiple
outbreaks of violence and pillaging in African diamond fields because
there was no "war" -- in the classic sense of one state fighting
another or a state vs. organized rebels.
The Kimberley rules certainly never anticipated a situation like the
one in Zimbabwe. The Marange diamond fields, containing some of the
most plentiful deposits in the world, were discovered in 2006; soon
afterward, Mugabe's soldiers moved in with helicopters. According to
Human Rights Watch, they massacred at least 200 independent miners,
then set up shop using conscripted laborers, including children.
Because Kimberley has no provisions for what happens when a sovereign
government kills its own citizens, it seems likely that "Mugabe
diamonds" will be hiding in the global supply chain for some time.
3. Diamonds have long been symbols of love and marriage.
The tradition of the diamond engagement ring was largely concocted in
the 1930s by De Beers's ad agency N.W. Ayer & Son -- the same Madison
Avenue shop that would later craft the wildly successful slogan "A
diamond is forever." Through magazine advertisements and Hollywood
product placements, American customers were sold the idea that even a
man of modest means must give a diamond to his betrothed, just as
kings and aristocrats had done in several examples cherry-picked from
European folklore.
In fact, diamonds historically served as tokens of statist privilege
more than anything so frilly and ordinary as love. De Beers's appeal
to royal fantasies (and, more subtly, male fears of inadequacy)
nonetheless caught the American public's imagination, as did the
notion that a groom is supposed to spend two months of his salary on a
rock. This, too, was an invented custom. It was also flexible: In ad
blitzes elsewhere, British customers were told to spend one month's
salary, while the Japanese were told to spend three.
4. People will always buy diamonds.
Setting up a tollbooth at the gates of marriage was a brilliant move.
But even so, history shows that diamond sales tend to mirror general
consumer spending on luxuries. When hard times come along, diamonds
are among the first items scratched from a shopping list. After the
market spasms of 2008, diamonds had their worst year in decades, and
even the resilient bridal market suffered. Total sales reportedly
plunged 20 percent in the United States, and this spring, De Beers
slowed work at its mines.
This isn't the first time that a recession spurred some
reconsideration of the diamond ethos among consumers. The Asian
currency crisis of 1997 tore a hole in the Japanese diamond market:
Nearly every bride in that nation used to go to the altar wearing a
diamond engagement ring. That's no longer the case today.
Bad press on humanitarian issues seems to have had a lesser effect,
though. Even after the December 2006 release of the movie "Blood
Diamond," a Leonardo DiCaprio action-adventure that paints a harrowing
portrait of the African diamond trade, jewelers reported a reasonably
good Christmas season.
5. The famous Four C's are the best markers for determining a
diamond's value.
This handy mnemonic -- color, cut, clarity and carat -- was developed
in the 1940s by the Gemological Institute of America, still the
world's premier diamond-grading company.
Lore holds that every diamond is unique and a work of nature's art.
But this idea was intimidating to American customers who wanted a firm
readout of a diamond's worth before buying it. De Beers therefore
loved the Four Cs, and the company sent speakers on a promotional tour
to explain these standards as if they had been observed for centuries.
But when it comes to the most popular kind of diamond -- the round,
brilliant-cut stone that is a staple of engagement solitaires -- a key
factor embedded in the cut rating is likely to have a big impact on
value. The "depth percentage," the relationship between the stone's
top and the angle of its slanted sides, can make a diamond's glitter a
little more spectacular thanks to the physics of light. The sweet
spot? A ratio of 58 to 60 percent. Too many buyers of stones of less
than two carats get hung up on minor gradients of color and clarity,
which are invisible to the naked eye and meaningful only at the cash
register.
For those who don't plan to routinely ogle their stone under a
microscope, an easier formulation would be the Two S's: size and
sparkle. The resale value of a diamond drops between 30 and 50 percent
the moment you walk out of the store with it (a sixth myth is that
they are good investments; they aren't) so you might as well enjoy its
illusory light while you can.
[Tom Zoellner is the author of "The Heartless Stone: A Journey Through
the World of Diamonds, Deceit, and Desire."]
http://www.washingtonpost.com/wp-dyn/content/article/2010/07/02/AR2010070203990.html
Elfin Tyusis
Remember, four weeks' salary is what she expects you to pay for that
price-controlled rock.