Diamond market

[deleted_user0]

So... I somehow just learned there are labmade diamonds that no expert can discern from a natural diamond. How come this hasn't crashed the diamond market yet? What about the alchemist's dream of creating gold? In any case, diamond prices may plummet yet...

https://wolfstreet.com/2018/09/11/is-di ... crumbling/

Why is de Beers accused of price dumping? Why aren't the others accused of cartel pricing or making price arrangements? This seems to be some real dodgy business

@Dolan know anything about this?

Ps: I've read your other post. It was excellent, I will reply to it later.

[Mr_Bramboy]

Someone (insert triple parentheses if desired) has an interest in keeping the prices high and is actively discouraging the production and sale of lab-made diamonds. I remember reading about lab-made diamonds quite a few years ago in high school, and since they're still not on the market it wouldn't surprise me if there was something shady going on in that whole industry.

[Horsemen]

The simple version of the answer is that consumers are willing to pay more for natural rather than lab-grown diamonds.

There does, however, exist a market for cheaper, synthetic diamonds, and De Beers is now trying to target them: https://www.ft.com/content/8b502874-fee ... a2a826423e

[deleted_user0]

The simple version of the answer is that consumers are willing to pay more for natural rather than lab-grown diamonds.

There does, however, exist a market for cheaper, synthetic diamonds, and De Beers is now trying to target them: https://www.ft.com/content/8b502874-fee ... a2a826423e

well, synthetic diamonds is not a correct term. They're both real diamonds. And expert gemologists can't tell the difference between the two. Most consumers are probably ill-informed, I bet that most would people wouldn't be opposed to labgrown diamonds when they realise they're basically the same, especially considering that most people don't want blooddiamonds anymore.

[Horsemen]

The simple version of the answer is that consumers are willing to pay more for natural rather than lab-grown diamonds.

There does, however, exist a market for cheaper, synthetic diamonds, and De Beers is now trying to target them: https://www.ft.com/content/8b502874-fee ... a2a826423e

well, synthetic diamonds is not a correct term. They're both real diamonds. And expert gemologists can't tell the difference between the two. Most consumers are probably ill-informed, I bet that most would people wouldn't be opposed to labgrown diamonds when they realise they're basically the same, especially considering that most people don't want blooddiamonds anymore.

That might be true, but right now they are separate markets. If most consumers are told that a diamond is lab-grown, their perception of its value decreases. This is less due to consumers' inherent preferences and more due to the monopoly power that De Beers has leveraged over the last century. That the company has successfully persuaded everyone that natural diamonds are rare and valuable, when they are in fact common and relatively cheap to produce, is a case study in the importance of effective marketing practices.

[deleted_user0]

The simple version of the answer is that consumers are willing to pay more for natural rather than lab-grown diamonds.

There does, however, exist a market for cheaper, synthetic diamonds, and De Beers is now trying to target them: https://www.ft.com/content/8b502874-fee ... a2a826423e

well, synthetic diamonds is not a correct term. They're both real diamonds. And expert gemologists can't tell the difference between the two. Most consumers are probably ill-informed, I bet that most would people wouldn't be opposed to labgrown diamonds when they realise they're basically the same, especially considering that most people don't want blooddiamonds anymore.

That might be true, but right now they are separate markets. If most consumers are told that a diamond is lab-grown, their perception of its value decreases. This is less due to consumers' inherent preferences and more due to the monopoly power that De Beers has leveraged over the last century. That the company has successfully persuaded everyone that natural diamonds are rare and valuable, when they are in fact common and relatively cheap to produce, is a case study in the importance of effective marketing practices.

Well, it seems to be a relative new development that they can produce gemstone quality diamonds of larger carats. But yes, there's definitely marketing power involved. It's actually de Beers which now wants to sell manmade diamonds at the cheap price, much cheaper than what both natural diamonds and mandmade diamonds are sold for now. I'm mostly interested in the latter, why is the price of manmade diamonds still so high, when it can be massproduced at a relatively low cost.

[momuuu]

What is the production capability of lab diamonds? That seems a relevant thing to figure out first.

If they can just produce diamonds like it's nothing, then I think this just proves capitalism doesn't work. People have been willing to pay that much for diamonds, so why wouldn't they keep paying that much? The big corporations probably don't feel the need to actually compete yet. That's my speculation.

[deleted_user0]

What is the production capability of lab diamonds? That seems a relevant thing to figure out first.

If they can just produce diamonds like it's nothing, then I think this just proves capitalism doesn't work. People have been willing to pay that much for diamonds, so why wouldn't they keep paying that much? The big corporations probably don't feel the need to actually compete yet. That's my speculation.

well, it's not like it's nothing, but it costs less than a mining operation for sure. And since it's pressurized carbon, it's not like there's a very finite supply of materials, nor is it as hard to make as gold for example. It's mostly energy intensive, and you need the right facilities, but it's a completely automated process apparently. So, yes, the diamond lobby is preventing prices from dropping in different ways. One is mentioned in the article, they're suing companies who try to sell these diamonds at a price that's much lower than natural diamonds and what they've been selling manmade diamonds for for some time. Another one is mentioned by horsemen, marketing to make sure that people "falsely" attach different value to manmade diamonds compared to natural diamonds. They might have different tricks as well

[kami_ryu]

-- deleted post --

[deleted_user0]

This doesn't surprise me too much.

However I thought synthetic diamonds were already a thing? Used in tooling applications? I could be wrong.

manmade industrial diamonds, yes. but not gemstone quality for jewelry. by new I mean like the past 10 years or so. At least, that's what I read.

[Horsemen]

What is the production capability of lab diamonds? That seems a relevant thing to figure out first.

If they can just produce diamonds like it's nothing, then I think this just proves capitalism doesn't work. People have been willing to pay that much for diamonds, so why wouldn't they keep paying that much? The big corporations probably don't feel the need to actually compete yet. That's my speculation.

In a communist society, everyone would get free diamonds!

[Jam]

I am a diamond. I am hard and tough. I am refined and radiant. I shine. I am beautiful.

[kami_ryu]

-- deleted post --

[Dolan]

know anything about this?

Vaguely. I know that De Beers have been a monopoly for like half a century, until the 1980s. Since then a few other players asserted themselves on this market and gradually De Beers have been pushed to under 50% of the market. They used to invest in advertising and marketing since the 1940s, when they worked to create this image that every guy should buy his fiancee a diamond to seal their engagement. If you ever heard of these quotes: "diamonds are a girl's best friend" and "diamonds are forever", they were pretty much the work of advertising agencies working for De Beers. They were paying Hollywood celebrities, renting advertising space in big newspapers, to project this image that diamonds are the most valuable gift a guy could get for his gal. And for decades they controlled the supply of diamonds on all markets to make sure there was enough scarcity to justify the high prices. They always made sure the market wasn't flooded with too many diamonds, which could have driven prices too low.

As far as I know, synthetic diamonds don't have inferior chemical and aesthetic properties, they're quite comparable. In fact, there is a higher chance of getting less impurities in a synthetic diamond compared to a natural one. But, of course, with a bit of marketing you can make people believe natural diamonds are still "worth more", because that implies uniqueness, natural process and rarity. Synthetic diamonds, on the other hand, are probably perceived to be "fake", contrived, mass-produced and thus not so unique etc.

[deleted_user0]

I am a diamond. I am hard and tough. I am refined and radiant. I shine. I am beautiful.

Diamonds don't shine... they reflect, b****.

[Jam]

I am a diamond. I am hard and tough. I am refined and radiant. I shine. I am beautiful.

Diamonds don't shine... they reflect, b****.

I am also overpriced and embroiled in regional conflicts.

[deleted_user0]

I don't think lab diamonds will ever crash the price of real diamonds. After all, it's a very luxurious product, it is very costly to enter the market plus the product has highly inelastic demand.

It will simply divide the market into two parts.
We are going to have "real diamond market" for those who have more money than they can spend. They do not care if they could have same-looking lab-diamond for 10x less price. If you are looking for a status symbol and you have too much money, you are going to buy a real Rolex, not a fake one, even if they look completely identical. Normal people are probably going to buy lab-diamonds. However, the problem here is that market entry is easier and it's only matter of time how long it takes until China mass-production has driven the price as low as possible. However, De Beers is a respected brand and that is the reason why it could still maintain high prices despite of competition. I think it's a good decision to create a gap between real and labdiamonds.

I don't really think there should be "predatory pricing" restrictions in such an industry. Firstly, because of predatory pricing regulation is highly controversial. Secondly, they are diamonds after all. It's not something that consumers have to buy. It's completely different if we would talk about expensive medicine that only a few companies could produce and some people need for living, entry cost being high.

Anyway, this shit is making me rich. Almost +100% with dividents in 2 years or so.

[momuuu]

But theres literally nothing stopping a company from selling lab diamonds as if they are real diamonds. So why does the difference matter if there basically is no difference?

[deleted_user0]

But theres literally nothing stopping a company from selling lab diamonds as if they are real diamonds. So why does the difference matter if there basically is no difference?

Cause selling lab diamonds as real would be a fraud? As long as professionals can tell the difference. And if you are selling real diamonds, you are for sure going to make sure by your marketing they are indeed real. And trust me, these guys know marketing.

I'm quite sure there are Chinese factories that produce quality-wise "perfect" Louis Vuitton bags. But people are still are willing to pay 10 times more for the same bag if its real. I would guess it's the same story with diamonds. Except there is only a finite amount of diamonds. And they are for more elite people.

[deleted_user0]

But theres literally nothing stopping a company from selling lab diamonds as if they are real diamonds. So why does the difference matter if there basically is no difference?

Cause selling lab diamonds as real would be a fraud? As long as professionals can tell the difference. And if you are selling real diamonds, you are for sure going to make sure by your marketing they are indeed real. And trust me, these guys know marketing.

I'm quite sure there are Chinese factories that produce quality-wise "perfect" Louis Vuitton bags. But people are still are willing to pay 10 times more for the same bag if its real. I would guess it's the same story with diamonds. Except there is only a finite amount of diamonds. And they are for more elite people.

they can't tell the difference, that was the point. they're chemically identical. Unless the manufacturer leaves some sort of signature, they can't be told apart, especially not after they've been cut. That's why I wondered why it hasn't crashed the price yet. But I guess it's because the people making the diamonds in a lab, are also the same people mining them in the mines. Undoubtedly though, labmade diamonds have already been sold as natural diamonds without the consumer knowing.

the fake/real when there is no difference is indeed an interesting phenomenon, but it's psychological. Imo, it's silly.

[deleted_user0]

"In order to identify a natural diamond from a synthetic diamond, you need to use specialised equipment. The nature of inclusions in a natural diamond differs from the types of inclusions found in a synthetic diamond. Not all inclusions are easily visible through the naked eye or by using a loupe. The best way to find out if the diamond is natural or synthetic is to ask the jeweller for a grading report. The Gemological Institute of America (GIA) will indicate on the grading report if the diamond is synthetic."

I thought they can be identified, they only look like each other. On the other hand, if you buy a real diamond from a De Beers store, you can be sure it's real. Interesting.

[deleted_user0]

hmm, in a few other articles i read that basically experts couldn't tell them apart either. Perhaps not then. De beers also sells synthetic diamonds, which is what the article in the OP is about.

[momuuu]

When you can't tell the difference, there is no difference. If that's the case, then it's like putting some arbitrary label on one product and advertising that heavily while having a secondary unadvertised brand. This sort of works for food too. We're willing to pay more for a known brand than for a cheap spinoff producing basically the same thing.

[musketeer925]

Even if you can't tell the difference, documents that come with the diamond certifying it as "natural" could be used to verify its value, in the same way that documentation of where it was mined can be used to verify it wasn't a blood diamond (which is done although I'm not sure with great success).

[deleted_user]

When you can't tell the difference, there is no difference.

This has greater implications than diamonds i.e. 2040 sex bots i.e. our whole sensory experience is subject to foolery.

The difference lies more in theory of principle, in something derived not merely sensed, regarding things like authenticity because we can't let ourselves concede truth-ish-shit to artifice.