Diamonds—Are They Really “Forever”?
THE crowned heads of Europe, both kings and queens, used to adorn themselves with them. England’s Royal Scepter (see photo) boasts the world’s largest one. Its Imperial State Crown contains the second largest, surrounded by 2,800 smaller ones. The Russian treasury in Moscow houses a celebrated one worth a king’s ransom. Once the Aga Khan, venerated by Ismaili Muslims as a semidivinity, had his weight, 243 pounds (110 kg), matched in them.
It was once thought that the presence of one would cause wrongdoers to confess their sins. In addition, they could overcome poisons, end delirium and needless worry. They could curb violent feelings and thoughts of murder, and, above all, strengthen love. They could be used as an unfailing test for fidelity. Placed on the breast of the sleeping mate, one would cause the sleeper to reveal his most guarded secrets. It was thought they had the power to repel ghosts, to cause quarrels and terrors, and to bring death.
Yes, it is diamonds that have all this prominence and to which such power has been attributed. But of all the superstition and folklore that have surrounded diamonds and why people continue to seek them, one reason remains the same—they are a status symbol.
Do you possess a diamond? Hold it up to the light. Notice its brilliance and sparkle. Turn it slowly. Observe the miniature fire that appears to be burning in each of its “chambered” facets. Of all the gems discovered by man, the diamond has the greatest refraction and dispersion of light. And you are holding in your hand the hardest substance known to man, natural or artificial.
But here is a mind-boggler: Take a piece of lead from any ordinary pencil and hold it up to the light. Does it sparkle? Does a fire appear to be burning from within? Do you observe a diamantine luster? Are you impressed with the hardness of it? Yet the diamond and the pencil lead have something very much in common—they are of the same element—carbon. And so is graphite, and yet graphite is so soft it is used as a lubricant.
Even though diamonds are the hardest substance known, they can be shattered and reduced to dust. Although some have thought that the swallowing of diamond dust was supposed to be fatal, others have ascribed magical and curative powers to it.
The uses of the diamond in industry, however, are unmatched. Consider this, for example: The hardest steel can cut a five-mile-long (8 km) groove in a length of ordinary bronze before needing to be sharpened. A tungsten-carbide tool will remain sharp for 21 miles (34 km), whereas the diamond will make a cut 1,200 miles (1,900 km) long. Heavy-gauge copper wire can be pulled through a tiny hole in a diamond for 15,000 miles (24,000 km), reducing it to fine metal thread, before the diamond requires reshaping. Diamond-edged tools are often the only things that will cut today’s superhard metals. The value of industrial diamonds is undisputed.
A Status Symbol
If you, however, own a diamond, either as an object of adornment or for investment purposes, it is not of industrial quality. It was specially cut, faceted, and polished to bedazzle you and others with its sparkling brilliance. For the majority of the multimillions of women who own diamonds, the engagement ring probably came first. Since young men buy over 90 percent of all engagement rings, most purchases are made with the idea that diamonds are a gift of love—the larger and more expensive the diamond, the greater the love.
Some experts believe that at least 80 percent of all engagement rings sold are mounted with diamonds. But why not with a ruby or an emerald? Certainly these are often more colorful. Ah, but has it been said that rubies or emeralds are “forever”? Or that the sapphire or the topaz is “a girl’s best friend”?
The fact that diamonds have become for the most part a symbol of love, romance, and marriage is not without design. It is the result of a well-orchestrated advertising campaign, subtle in its approach, that marriage and diamonds cannot be separated. Particularly since 1947 has this subtle approach been used in movies, magazines, and television.
The advertising scheme had far-reaching goals in mind—to bring even the poorer wage earner into the diamondfold. One agency wrote: “We spread the word of diamonds worn by stars of screen and stage, by wives and daughters of political leaders, by any woman who can make the grocer’s wife and the mechanic’s sweetheart say ‘I wish I had what she has.’” With the diamond on her finger even the “grocer’s wife” can take her place alongside the more well-to-do women as she strolls through the marketplace.
But what about the mechanic or the grocer who provides this new status symbol for his mate? The diamond must be seen in a dual role that will also sweeten the status pie for the man. “Promote the diamond as one material object which can reflect, in a very personal way, a man’s . . . success in life,” it was noted additionally.
While the diamond push was on in the United States, and had been almost since the turn of the century, now it was determined that the advertising arm should reach across the sea to Japan. From 1968 to 1981 the number of prospective Japanese brides receiving a diamond engagement ring rose from 5 percent to 60 percent.
What was the real force behind the diamond drive? It was, and is, the most powerful cartel in the history of commerce. Its influential arm spans the globe. Since its beginning, in the closing years of the 19th century, it has had one objective—to control the flow and price of diamonds.
To begin with, diamonds are not as rare as some may think. Today diamonds are mined on three continents and with huge machines are scooped up by the ton, with Africa supplying a large percentage of the world’s output. Australia’s new mine boasts a potential output of 20 to 50 million carats a year. (A carat is a weight unit equal to 200 milligrams, or 1/142 ounce.) Today industrial diamonds are even being created in huge machines.
However, this was not always the case. Thirty years before the turn of the century, diamonds were indeed rare—just a trickle being discovered in India and Brazil. When large diamonds were found in one remote part of South Africa, it brought a stampede of fortune hunters into that tiny area, which almost overnight saw 50,000 men digging into the earth looking for diamonds. In course of time, they dug the largest man-made crater in the world—the Kimberley mine, 1,520 feet (463 m) across and 3,601 feet (1,098 m) deep. Then other diamond mines were found, and these once rare stones were being mined by the ton. Diamond investors saw their fortune balloon about to burst. The price of diamonds would surely nose-dive.
Farsighted men, however, saw the need for the development of a single channel for the distribution of the world’s diamond production. Such a monopoly must buy all available diamonds, control the flow to the distributors, and hence control the price. The central organization formed for this purpose was named De Beers Consolidated Mines, Ltd., of South Africa. Today De Beers markets 80 percent of the world’s output of rough diamonds.
When Russia discovered diamonds in Siberia in 1960 and began mining them on a large scale—ten million carats a year—De Beers realized the plunge in prices if Russia’s diamonds were suddenly dumped on the world market. They convinced Moscow to sell virtually all its uncut diamonds to the De Beers syndicate. An agreement was also reached with the new diamond mine in Australia.
When, however, the cartel absorbs more diamonds than are being sold to maintain its monopoly, it faces grave danger. Some experts believe that this is the case, and they fear that the demise of the amazing cartel is fast approaching. They point out that the diamond glut will force the prices down, and the once precious diamond will be reduced to only a semiprecious stone.
Not the Investment Once Thought
Many are those who have purchased diamonds and diamond rings with the idea that they are like money in the bank or like savings accounts, collecting interest. In difficult financial situations, many have been forced to try to sell their rings, only to find that their $250 ring contained a $20 diamond in a $100 setting.
Like everything else sold to make a profit, there is a markup. For diamonds the markup may range from 100 to 200 percent. Many leading jewelry stores have strict policies against repurchasing diamonds. Often they do not want the embarrassment of admitting that the diamond was not as good an investment as they had claimed.
Most diamonds in rings contain flaws, and one nearly invisible flaw can cut the value of the diamond in half. Prospective buyers will be quick to point this out. If you have an expensive diamond, however, and you are considering selling it, find a reputable diamond appraiser and let him examine it. But selling it for the appraised value may be a problem.
If you are contemplating marriage and are considering a diamond engagement ring, buy it because you truly like its beauty, brilliance, and fiery sparkle and not because it is a status symbol today. Tomorrow it may have very little value.