Popularly said that diamonds value drop by over 25-50% the sec you buy it. I know that diamonds value is low key de beers bullshit.
But what I wanna know is how do they calculate the diamond resale value and rational behind 50% resale value of something that never breaks or damages. How do they come up with this shit?
In: 1922
Because you buying the story of the diamond. That’s what they are selling you.
You aren’t buying the stone’s value. The diamonds most people buy really aren’t worth anything. They aren’t rare. They are not coveted. The are run of the mill diamonds that lose most of their value the moment you leave the store.
ELI5
You overpaid.
You pay a high price (at retail) and the item is bought back at a low price (at wholesale). When confronted with the difference, you realize the amount the product is marked up.
The resale value is very stable (Rap). The markup varies by retailer and can be shockingly high.
DeBeers does very little of this. They only have a few retail stores. They are more of a global producer or wholesaler at best. The markup comes from retailers (Helzberg, Zales, Tiffany, Harry Winston, etc).
Because diamonds are not rare. There are some rare types of diamonds but generally they don’t have much value. When u buy then from jewelry stores they are over inflated. You are basically buying an over inflated piece of charcoal.
We have De Beers to thank for that. After the great depression, they tried to stoke demand for diamond by launching an ad campaign with the tagline ‘A diamond is forever’.
In the first half of the 20th century, De Beers had a stronghold on the diamond market as most of the mined diamonds were sold to them. They were able to control the supply chain by limiting who was allowed to buy, how much they were allowed to buy, how many diamonds they wanted to sell and at what price.
With the proliferation of synthetic diamonds, I would say just go for that instead.
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