> I expect diamonds to lose almost all of their value.
Artificial diamonds, you mean. The natural ones will keep their price, just as "hand-crafted" goods did (and, I suspect, as "human-produced" content in the future will); it's a matter of status and signalling that you can afford to buy an inferior, more expensive product.
In 2012, when I was shopping for an engagement ring, a natural 2ct diamond cost $250,000. (I bought a 2ct moissanite for much, much less, and my wife is very happy with it.)
When I looked in fall 2023, a natural 2ct diamond cost $20,000. That's a loss of over 90% of value, not counting inflation! (Now the supply of diamonds is much higher, and the demand for natural diamonds is much lower.)
I suspect that natural diamonds will be sold for a 40-300% premium over manufactured. I also wonder if impurities will become fashionable, just to show that a specific diamond is actually natural and can't be made in a lab.
> Artificial diamonds
BTW, there is no such thing as an artificial diamond. A manufactured diamond is 100% diamond, for all intents and purposes.
Quick note that a very nice 2ct stone has never cost $200,000.
Not sure who was trying to charge you that much in 2012 or why, but gem diamond prices haven't changed much in the past 30 years, although there was an uptick in the covid/inflationary years, and a reversion to trend more recently.
This is like arguing about somebody saying a car costs $25,000 when you’re talking about a Bentley. It’s expensive because it’s a Bentley not because it’s a car.
I take your point but theres a still a huge gap to make up for.
I went deep on this topic a couple of years before OP' 2012 date. An IF 2ct would not have exceeded ~80k usd. Not from Tiffany but from a national US shop. And the retailer shouldnt have mattered anyway.
The realities of this market have not hit the consumers. Even young people are still out there spending 5-6 figures on a rock and ascribing real value and aspirations towards eventually "upgrading" into said rocks from perhaps an existing synthetic alternative already set in the ring. Even if the supply side price argument is so perverted now, we still have a culture that wants to put a high value on this object for sentimental reasons. No one wants to hear that diamond rings are worthless. They want to spend money on it. Spending an appreciable amount of your savings on it is the entire significance of it, not really the value prospect.
Someone should market a synthetic diamond that has a crypto address etched onto it. It just had to be big enough that the augmented reality glasses can automatically pick it up to render the account balance.
AFAIU by the time of British colonisation in the Carribean / West Indies, sugar was cheap and afforded plentiful calories (and caries) to the working class.
Along with (relatively) inexpensive tea, the practice of serving boiled water-sugar solution greatly improved health (given the lack of water treatment at the time), reduced alcohol consumption, and provided additional food energy. And that was by the mid-to-late 18th century so far as I'm aware.
I'm not aware of any time or place where sugar was considered a luxury item, at least not for any substantial duration (say, excepting famine, economic recession, or war).
It's not useless as such, although certainly its use is exceedingly niche. My headcanon is that Cecil Rhodes saw something back in the 1880s, something which drove him to create a corporate engine which would continue to bend the culture centuries after his own death. Now, a hundred and fifty years later, an appreciable fraction of the population carries with them at all times an object capable of scratching everything. What he saw, I cannot say, but one day in our hour of need the population will be equipped.
bitcoin is the 21 century's diamond. Same useless string of cryptographically signed bytes, but for some reason the humanity agrees to assign some value just because of scarcity mindset.
Last I heard from the forefront of geology and ecology, "natural" televisions and tacos have yet to be found.
So I don't think the distinction is best analyzed with examples like that.
If something is normally created and nature, and humans find a way to reproduce it, it is common to call the human produced versions artificial even if the result is identical in principle.
Humans make lots of distinctions that fall apart if we get too pedantic, but have useful casual, cultural, or practical associations and meanings.
Burn hydrogen to make water. Is that artificial water? Or is it forever artificial water? Is all water that mixes with it artificial water? Is all water now artificial since it has mixed with human made water?
While the basic definition seems to be merely "man-made", I would say it holds there is some underlying distinction between the natural and artificial. Natural light vs artificial light -- the two are distinctly different. But are the photons produced by a light bulb artificial, or are they natural photons?
Artificial diamonds are more diamond than diamonds. The diamond portions are identical, regardless of origin.
Or maybe there are trapped gasses or other identifiers left in them that make them distinct. I don't really know about this point.
Anyhow, the natural vs artificial distinction really seems to break down when things are (literally) physically and chemically identical.
That's not what makes things artificial vs natural. Artificial vanillin is "more vanilla than real vanilla". A natural vanillin molecule is indistinguishable from fully synthetic vanillin from crude oil. The latter is still called "artificial flavor".
Artifical vanillin is not the whole package though, as there are other compounds in natural vanilla that make up the flavour, so it doesn't reflect the full product. "Natural" vanilla extract may also never have seen a vanilla bean, as it could be plant derived, or even from a beaver's ass.
Until the rise of synthetics the perfect diamond had no flaws or impurities. Now the language has changed and apparently it's all about just the right number of imperfections and impurities, though those will also be mimicked in short order (if they haven't been already).
There is a genuine physical reason to prefer 'real' vanilla extract over artificial. Not so much for diamonds.
You get them whether you want it or not, at least some of the time. Entropy and so forth. The synthetic ones with worse imperfections are cheaper.
It's probably possible to guess by inspection whether the imperfection properties imply mined vs lab grown, with some level of accuracy.
Source for the existence of imperfections is reading through lists of specific diamonds a few years ago. The synthetic ones didn't vary much in colour but did vary in number and distribution of inclusions.
This is Gary: his job is to give the machine a solid kick once a day and crack the vacuum seal on Fridays. Gary made us 120 million in imperfections last quarter.
> I also wonder if impurities will become fashionable, just to show that a specific diamond is actually natural and can't be made in a lab.
I hope that happens for purely aesthetic reasons too: natural "imperfections" add a lot of visual variety and interest that's otherwise missing in a lot of diamond jewellery—at least the sort that I've seen.
High-end watches are worse at telling the time than electronic watches, but they are visibly different and identifiable, so they can broadcast status.
Diamonds made by man or nature are now indistinguishable, except to highly trained experts (and even then, not always), so it's unclear why anyone would prefer the expensive kind.
I think this is a bit of a strong prediction. It's already been interesting to watch the rhetoric switch from "Natural ones are stronger and more pure" to "Manufactured diamonds don't have the flaws that give character". Which itself is fairly short-sighted, we can already manufacture things like star-sapphires with specific impurities in them.
So in the end all that will be left is "this one is natural". It will be a 'veblen' type signal for some people... but maybe it'll start to be a signal of gullibility, and also of recklessness or callousness, because diamond mining has both environmental and human costs.
Seems like it would have the opposite effect from what you want
You want people to prefer artificial diamonds because they're cheaper, so it becomes less financially viable to sell natural diamonds, so the people involved in that immoral stuff you're mentioning go out of business
Just like the "distressed wood" trend caused a booming business of making products that all have the exact same "distressed" pattern.
History doesn't repeat, but it certainly rhymes.
I know somebody that works in a wooden floor business. They take perfect new wood and move it through a cylinder that drops pebbles on it. They sell it for 2-3 times the price of undamaged wood.
They already do this with emeralds -- fake inclusions and flaws to make them look more like natural stones. If a natural emerald and a good synthetic emerald are distinguishable, it's often only because the synthetic one still looks too much better -- its color and overall clarity are still a little bit too good.
They were created by humans; therefore, "artificial", or "manufactured". Just because there is no practical way to distinguish them from the ones that appeared naturally doesn't mean they weren't created artificially.
"But this is a purely philosophical difference then!" Yes, it is. Humans still take such silly differences into an account, consider e.g. replicas of artwork made by the original artist themself. Are they genuine? Debatable!
For the same reason you can make a print of a classic painting, and digitally brighten and re-saturate the colors to counteract the darkening and yellowing of the original with age. Remove all of the cracking too.
And you'll still only be able to sell the print for tens of dollars, while the original is worth millions.
People attach value to authenticity and originals and tradition, however they define that.
In the event artificial diamonds are genuinely indistinguishable from natural ones they will all, natural and artificial, become worthless aside from practical applications.
A higher-end Rolex knockoff is indistinguishable from the real thing to the naked eye of a casual observer, and yet people still buy the real thing for 10 times the price.
Brands will make themselves known as the more expensive option. People don’t give cubic zirconia engagement rings as is because they’ll look cheap if they’re honest and be outed as a cheap fraud if it’s found out that it’s not a diamond when they pretended it was.
De Beers will find a way to make aspects of the jewellery other than the gem identifiably theirs. Then when you’re caught pretending a $100 lab diamond ring is a $6,000 natural diamond De fBeers ring you’ll be in just as much trouble as if you’ve given them a cubic zirconia.
In the west we're no longer living in a time where most people get married and then start their lives together. People often cohabit for years before marriage, and with more women working and earning as well the "hey I've got money and I'm dedicating a chunk to you!" signal isn't so much of a thing.
> People attach value to authenticity and originals and tradition, however they define that.
That (some) people might attach (some) value to those attributes does not guarantee that the monetary value will be preserved. Pre-20th century antique "brown" furniture is a notorious example - where market value has collapsed in the last few decades as fashion has shifted.
But something else - authentic mid-modern furniture like Eames chairs - took its place. Old furniture is still in very high demand (and expensive), it's just that the specific pieces have changed.
The prints most certainly aren't better. Hand painted is not something that can't be defeated with a printer currently. Besides you pay for the history of the original not the paint. A natural diamond has essentially the same history as any other rock you can pick up anywhere for free. People pay for the feeling. That doesn't mean a synthetic diamond is physically superior in every way.
I never bought a diamond in my life and have zero intention of doing so, but I can see how to some people there would be the appeal of knowing that a diamond came from some rock where it had stayed untouched for millions of years vs. an artificial one made in some China lab last month.
I think the value of diamonds has always been their rarity and cost. Historically, for married women this allowed them some financial strength and safety net. Of course as time goes on that function becomes less useful, but the idea has still stuck around a bit.
I predict people will turn to other gemstones, or will stick to "natural" diamonds and maybe even get them certified and stuff, producing another artificial market to inflate their value.
Having inherited a stupidly large rock that had been in my family since 1905,I moved immediately to divest, and it wasn't in any way hard to sell, just really costly.
Even with step-up cost basis cancelling out huge capital gains, Sothebys bit off about 22% in commissions and fees for itself.
I also explored selling through an individual jeweler, and was offered 6 figures cash in a briefcase, but the commission would have been about the same, just more camouflaged, and I had no reason to want to explain a six-figures-of-cash deposit to my bank I'd have had to make thereafter.
Big high quality diamonds at least, are liquid these days. (Your link is from 1982!) Just expect considerable slippage when you sell, the inevitable middlemen have sharp teeth.
Diamonds are already certified by GIA, so that you prove their clarity and quality and such (which no untrained observer would be able to differentiate)
I mean, having something valuable as a safety net and then carrying it around day and night where it can get damaged or stolen doesn't really sound like the smartest thing.
Artificial diamonds, you mean. The natural ones will keep their price, just as "hand-crafted" goods did (and, I suspect, as "human-produced" content in the future will); it's a matter of status and signalling that you can afford to buy an inferior, more expensive product.