Sunday, December 5, 2021

Diamonds below wholesale?



I noticed an advertisement in an out of town newspaper the other day that claimed “We sell diamonds below wholesale.”

I could not help but wonder, how? Did they steal them or what?

Then I realized in this economy, it’s possible. Let’s call it legal larceny.

Numerous times a week I receive phone calls inquiring if I buy diamonds, my answer is I’m sorry no I don’t, I only buy gold for scrap or to recycle into new sellable jewelry in my workshop.

Their next question is “Do you know who does?”

Up to a couple of months ago I did, and was happy to recommend several reputable diamond buyers in nearby Naples.

A funny thing happened, many of the Naples buyers called me and thanked me for the customers I had sent their way the past year, and would you mind not sending any more folks looking to sell their diamonds. What? Huh?

Their reason was quite simple; many dealers had exhausted their buying capital and had more diamonds than they knew what to do with.

It’s a cash flow thing; you keep buying, buying, buying and not selling, selling, selling even multi-million dollar companies will find the money well eventually goes dry.

Personally I have accumulated so many small diamonds since the recession I could pave my private parking space with the glitterly gems for a great effect and not even miss them.

The demand for engagement rings are way off nationwide, one reason is young couples are holding off getting married because at this time it’s so darn expensive.

First a guy shells out thousands for “the little rock” and wedding bands, then a wedding reception for over a hundred dollars a plate and finally two weeks in Maui. Who has that kind of cash today?

Money is still tight, and those folks that sold off all their gold are now looking to unload their diamonds.

Problem is nobody in these parts wants them.

That’s not totally true, that’s where the legal larceny comes into the picture.

Some places will only buy your diamonds if they can literally steal them by offering ridiculously low prices to the misfortunate diamond hawkers and many do sell them cheap. There are still many desperate people out there in this not so perfect place we call paradise.

My problem is I have a conscience; in a perfect world I would pay a fair price for the diamond so I can hopefully re-sell it quickly and make a few bucks.

It’s by no means a perfect world; public diamond demand is at this writing, flat to say the least.

I see no point in spending my hard earned money buying something as insolvent as diamonds.

The jewelry industry as a whole is learning this nationwide.

The media has the nation whipped up into a confusing frenzy one minute they suggest you sell your precious metals; days later recommend you should add gold to your portfolio. (What portfolio? 90% of us lost that years ago?) The other day I saw a T.V. ad selling food insurance? Prepare for Armageddon!!

It’s an emergency two week supply of food and beverages. (I’m not making this up.)

From where I sit, I notice things are getting a little bit better(I actually sold an engagement ring last week.) but it will be some time until things return to some semblance of predictability.

Used to be if the stock market did well, gold prices would plummet, that hasn’t been the case lately.

Gold hit a high of over $1380.75 an ounce a couple of weeks ago; I remember telling customers two years ago it would never go higher than $1000.00 an ounce , so much for forty years experience in the gold business. Today I have no idea how high it will go, or if it will crash like a lead balloon.

It’s an unwritten rule, gold prices always increase just before the holidays. It will be interesting to see what happens in the next two months.

All I know for sure is as a goldsmith if I hoard it, I starve; I have to turn my gold over almost as fast as I buy it.

What blows my mind is with all these ads hawking “bargain” diamonds for sale, I have yet to see these so called bargains. If I need a two carat diamond from my legitimate wholesale New York dealers for a customer request, the wholesale price is outrageous. (Try to find a nice two carat diamond that’s a G color and VS1 clarity for under $18,000.00.)

Just like gold, there is no rhyme or reason for diamond prices. The holidays are just around the corner, just beware that many jewelry stores have to have a profitable holiday season or face a tough 2011 or worse extinction and many will do what it takes to achieve that goal, and many will do it in a not so honorable way, such as false sales and deceiving the public with bait and switch programs.

Silver is the new gold, and is relatively reasonably priced. And, it will be hugely popular this season!

Richard Alan is a designer/goldsmith and owner of The Harbor Goldsmith and Richard’s Reef of Marco Island and welcomes your questions about all that glitters 239 394-9275

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