By Jeffrey Rackover
Diamonds, Diamonds, and more Diamonds
In the past month we’ve seen some of the hardest economic times our country has ever faced. We’ve seen money lost and people in despair. But there is and always will be a light at the end of the tunnel. And that light, I think, is from the gleam of a perfect diamond.
I say this in jest, but there is a seriousness to the investment aspect of these gemstones that many overlooked until the recent harsh realization that so-called safe-havens for investing-such as real estate or the stock market-are not as invulnerable as once thought. I almost feel guilty saying this, but, as of late, despite these hard times, I have been busier than ever; the pace of my business has seen an inverse reflection of the ongoing economic woes. Diamonds have been treasured since their use as religious icons in India at least 2,500 years ago, and the stones have maintained their value through the most tumultuous of times. The market crash of 1929 originally hindered the diamond industry, but thanks to De Beers’ ingenious introduction of the now-iconic catch phrase “a diamond is forever,” the brisk sales of the stones quickly returned, while countless other industries struggled.
Today, people have a new perception of their budgets and a new criterion for deciding what to spend money on. In light of the bad marketplace, to be too opulent is seemingly in bad taste. People want the luxuries that they have grown so accustomed to, but they want them in moderation. Before making a substantial purchase, people are taking a pause that was never present before, thinking about what it is they are buying and mulling over the purchase’s significance. It’s amazing how a simple pause or a second thought can change purchasing trends on such a large scale. Since many are now hyper-aware that virtually everything they buy is an investment, important purchases must be thoroughly researched and understood before an informed decision is made about how to spend hard-earned dollars. In times like these, fashion can be seen as frivolous and real estate can seem daunting.
Although in many minds, diamonds, gold, and platinum may also seem to fall in the same category, there is a fundamental difference: these fine jewels and precious metals will not lose their value, and, moreover, they are all easily portable, thus making fine jewelry a solid investment.
This is the ideal time to invest. It really is simple: diamonds will keep appreciating in value because people won’t sell them for less than they are worth, which does not hold true in the real estate industry. When someone invests in diamonds, they can expect to ultimately profit. The beauty of this business is that these expectations are consistently fulfilled, and this perpetuates a positive cycle of people constantly buying and selling within the diamond industry. Diamonds are a beautiful investment, and I have seen such a rise in my customers opening the vaults, picking out pieces that haven’t been worn in years, and selling them. The profits are then re-invested in a new piece that provides security and aesthetic fulfillment. I’ve also witnessed a trend of consumers opting for one substantial, classic piece rather than for three smaller ones.
With diamonds the investment is tangible. In today’s conservative marketplace, people want to be able to actually see their investments-to actually hold their assets in their hands-not have some conceived notion that their dollars are floating in the seas of the turbulent stock market somewhere. An investor would rather have the $10 million adorn his wife’s hand, wrist, lobes, or neck, as opposed to constantly worrying about the tumult of the stock market. I know I would, and I recommend that anyone who is wary of Wall Street to seriously think about investing in the diamond industry. History has proven, time and again, that these precious stones are a sound investment that will withstand even the toughest of economic times.
Jeffrey Rackover
589 5th avenue
New York, NY 10017
212.644.3838
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