saint_monkey

Analysts think that Leonardo DiCaprio's film 'Blood Diamond' may (temporarily) harm the diamond industry. (Wasn't that sort of the point?)

From the article:

James Hurley, an analyst with research firm Telsey Group, said the movie will likely affect sentiment with its star power and advertising push.

But he doubts people will stop buying diamonds, which would hurt retailers such as Zale Corp., Tiffany & Co. Inc., Blue Nile Inc., and Signet Group Plc, which operates the Kay Jewelers chain, as well as diamond processor De Beers Group, which is 45-percent owned by mining company Anglo American Plc..

"What a diamond means and what it stands for has been ingrained in people's psyches for decades, if not centuries. That's a pretty powerful attachment to ... destroy with just one film," Hurley said.

Yeah, blood washes off, a diamond is forever.

Let me spell it out. Except in some limited technological applications, a diamond... is useless. All these 'ingrained meanings and traditions' like diamond engagement rings, were started by diamond brokers to create a demand.

There are enough natural diamonds being withheld from the market to make the value of extant diamonds worthless, were they all released:

This is from a Frontline story,¹ and the source is a De Beer's employee:

" In this shoebox is basically the diamonds that they're going to cut that month. And in this mixture of diamonds, there are large diamonds, there are small diamonds, there are colored diamonds. There's what De Beers wants to be on the market. So they distribute to the cutters what is in short supply and withhold from the cutters what is in abundance, so they control the market through this"

Scientists can already create synthetic diamonds that are pretty much impossible to tell from a "real" diamond. This is from a "wired" article:

"These are cubic zirconium?" Weingarten (A diamond appraiser who has just been shown a synthetic yellow diamond of exceptional quality -srz) says without much hope.

"No, they're real," I tell him. "But they were made by a machine in Florida for less than a hundred dollars."

Weingarten shifts uncomfortably in his chair and stares at the glittering gems on his dining room table. "Unless they can be detected," he says, "these stones will bankrupt the industry."
²

So if the supply chain is completely bogus, and the existing supply can ANY DAY be flooded out by synthetic alternatives, then what is the diamond business? A sham. The diamond market is essentially a cartel, playing the game that people will buy into the hype and buy a diamond, or three chained together. Since the market is wholly artificial, then why should we put up with warlords enslaving the local populations to mine diamonds to piggyback off of this demand and fund their insurgencies? The government tells us all the time about how the drug trade funds terrorists, but they won't say a word about how diamonds also fund this same type of terror, and far worse. Don't buy a worthless product, propped up only by the endless parroting commercials that tell you that you can't love, or aren't loved, unless diamonds are involved. Don't be fooled, PLEASE don't buy a diamond.

¹http://www.pbs.org/wgbh/pages/frontline/programs/transcripts/1209.html
²http://www.wired.com/wired/archive/11.09/diamond.html