Be enlightened. Get informed.
About 130 million carats (26,000 kg) are mined annually, with a total value of nearly USD $9 billion. Now if you do the math - that works out to be US$69.20 per carat! The prices of diamond is artificially controlled and inflated. Mined diamonds are bought by cartels and kept in vaults to control supply and keep prices high, in truth there is nothing rare or precious about the stones.
For a detailed exposé of the De Beers cartel, read this article by Edward Jay Epstein in the February 1982 issue of The Atlantic Monthly - www.theatlantic.com/doc/print/198202/diamond
Have you heard of conflict diamonds?
Roughly 49% of diamonds originate from central and southern Africa - that's the majority of diamonds in retail. But this is the same region where conflict diamonds get worked into the system.
A conflict diamond (also called a blood diamond or a war diamond) is a diamond mined in a war zone and sold, usually clandestinely, in order to finance an insurgent or invading army's war efforts - http://www.amnestyusa.org/diamonds/index.do
In some cases, the United Nations has prohibited the export of conflict diamonds, arguing that their trade finances armies in fighting against legitimate governments and perpetrating human rights abuses, and prolongs devastating wars. It points to the UNITA rebels in Angola and to the Revolutionary United Front rebels in Sierra Leone (who it states were financed by the government of Liberia, also through diamond sales) as purveyors of conflict diamonds.
The UN is attempting to implement certification procedures to decrease the number of illicit diamonds on the world market. On July 19, 2000, the World Diamond Council adopted at Antwerp a resolution to strengthen the diamond industry's ability to block sales of conflict diamonds.
In 2002, the UN approved the Kimberley Process scheme aimed at preventing conflict diamonds entering the market.
See - http://en.wikipedia.org/wiki/Kimberley_Process
Still there is no guarantee the Kimberly Process can enforce 100% that no conflict diamonds make it to the market - see National Geogrpahic interview with reporter Dominic Cunningham - http://news.nationalgeographic.com/news/2003/02/0212_030212_diamonds.html
Natural mined diamonds have been coming under a lot of heat recently. Award-winning journalist Cecil Adams sums it up the best in a recent article: “diamonds are a scam, pure and simple.” Most people in the new millennium understand that between the DeBeers diamond cartel, the issue of child labor in Third World diamond processing operations, and “blood diamonds” used to finance oppression and genocide in Third World African countries, not to mention your snooty and pretentious local jeweler, diamonds are just not worth the hassle, guilt, and let’s not forget thousands and thousands of questionably spent dollars.
7 Reasons Why You Should NEVER Buy a Diamond:
1. The price of diamonds has been artificially inflated since the 1880's via the De Beers diamond cartel. Read this article by Edward Jay Epstein in the February 1982 issue of The Atlantic Monthly - www.theatlantic.com/doc/print/198202/diamond
2. Current public perception of diamonds is the direct result of a masterfully executed marketing campaign by De Beers that began in 1938, not inherent scarcity or value. If you've read the article by Edward Epstein (you really should), you know all of the gory details. Isn't it amazing (and scary) how brainwashed people are about the "value" of diamonds, even though they're not actually worth that much?
3. A diamond is an illiquid asset, not an "investment". Try to sell a second-hand diamond ring on eBay or at a pawn shop. Do you really think you'll get anything close to what you paid for it? Do you really think the price of any diamond you purchase today is going to go up significantly over time? Why do you think they say a diamond is forever? It's because once you buy it, it's a 'lost' investment so you'll have no choice but to hold on to it. Love is forever but a diamond is for never (if you are enlightened enough).
4. The diamond industry funds warfare, genocide, and terrorism. A conflict diamond (also called a blood diamond or a war diamond) is a diamond mined in a war zone and sold, usually clandestinely, in order to finance an insurgent or invading army's war efforts. Profits from conflict diamonds are used to finance warlords in Angola, Sierra Leone, and Liberia, who use their weapons to kill and maim innocent people. You won't be able to tell if your diamond is a conflict diamond or not?
Read BBC reports
5. A diamond is - by nature - just a pretty rock. Think of the oft-quoted "rule" of diamond ring buying: the ring should cost a minimum of two month's salary (pre-tax), and you should spend as much on a ring as you can afford. Let's put this rule in its proper context: according to the people who sell pretty rocks, you're supposed to trade a full two months of your time and effort for one of their pretty rocks. Does that seem wise?
6. People notice the setting more than the diamond itself. To the naked human eye, most decent quality diamonds look the same. Unless the stone is yellow, has major inclusions, or has a distinctly lopsided cut, no one will be able to distinguish an ideal cut, E color, VS-1 stone from a lesser-quality diamond just by looking at it. What people do notice is the setting - how the stone is featured or placed, side stones, and the craftsmanship and artistry of the band. Knowing this - does it make more sense to focus your attention and dollars on a better stone, or on a better setting?
7. The opportunity cost of buying a diamond is huge. Opportunity cost is what you give up by spending your scarce resources on a single option. In other words, if you drop ten grand on a diamond ring, you have $10,000 less to spend on other things, like a fantastic honeymoon, a car, furniture, a down payment on a house, investing for the future, or further education. Are all of these options worth giving up for a little piece of colorless carbon?
The death of South African diamond magnate Harry Oppenheimer last month might mark the end of global domination for one of the world's most infamous cartels.
By Susan Emerling
Lab-made diamonds are as dazzling as those mined by third-world labor. This bling may be easier on your conscience -- and your wallet.
By Corrie Pikul
What you can do?