Diamonds Going Up In A Falling World
Share prices are tumbling. In the wake of the $700 billion bailout rejection in the US, everything in the financial markets the world over seems on the way down except – did you guess? – diamonds! And the news is that with a growing demand from markets in Russia, the Middle East and Asia, there is bound to be a big gap between demand and supply in the days to come.
In an interview yesterday, the CEO of the Harry Winston Diamond Corp said in New York that there was “…a lot more upside in diamond prices than the public market appreciates,” and he went on to say that diamonds weighing 3 carats have quadrupled in price in just 1 ½ years.
So Standard & Poor’s 500 Index could have tumbled down nearly 9% but diamonds prices continue to hold their head up. The Harry Winston Diamond Corp has a 40% stake in the Canadian Diavik mine. So they should know when they say that with having to dig deeper and deeper in existing mines, rough diamond supply is going to decrease unless some new exploration throws up a new find. Given things as they are, diamonds will be a very valued luxury item for quite a while yet. Diamonds are not just forever – it looks like they are going to be valuable forever!
Tags: Diamonds
