Diamonds Are a Scam, Not Rare & Not a Good Investment - Stay Safe

14,149 views Wait, is this logic right? • Oct 14, 2023

Slog Reference: Technology is making diamonds worthless

Description

If you're asking if diamonds or diamond jewellery worth it, you need to watch this episode of the FutureIQ podcast. This episode will enlighten you with the dark truth of diamonds that is hidden behind the shining surface of the carbon structure. Learn more about how diamonds are a bad investment, gift and the difference between lab-grown artificial or synthetic diamonds and natural diamonds.

More videos for you:
Supply and demand: https://youtu.be/imweTGK0Myk
Costly signalling: https://youtu.be/0YEBK7eR3Ek

The article: https://tapthe.link/sellingadiamond

Hope you enjoyed FutureIQ by Navin Kabra and Shrikant Joshi. Do hit us up on Twitter:
@ngkabra http://twitter.com/ngkabra
@shrikant https://twitter.com/shrikant

Listen it on the podcast provider of your choice: https://tapthe.link/FutureIQRSS
Watch other episodes of The FutureIQ podcast: https://www.youtube.com/playlist?list=PLAppTB0r5_TaYueZ0adD42Wiw5X-wTE4v

Chapters:
00:00 Introduction
00:20 Why are diamonds expensive?
01:53 Supply of diamonds & De Beers
03:05 Demand
04:04 Diamonds & occasions
05:25 Education & diamonds
06:40 Diamond as an investment
08:00 Morality of buying a diamond
09:27 Lab diamonds
10:08 General perspective
10:52 Real vs lab-grown diamonds
15:00 Price & control

#futureiq #diamonds

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Technology is making diamonds worthless

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Transcript

- Diamonds Are a scam everybody who bought diamonds has fallen for the scam and now lab grown diamonds are going to cause the prices to fall let's understand diamonds today so Shri Kant diamonds are the ultimate in luxury and glamour right true it's one of the most expensive items of jewelry somebody is going to get yeah because diamonds are forever let's try to understand why are diamonds expensive why is anything expensive because Diamonds Are a specific crystalline shape and they are formed only in deep minds and they are difficult to extract and they are shiny and they are pretty well let's I mean talk in terms of basic economics right we have done an episode supply and

0m 44s demand oh okay if something is expensive it's because the demand is high right and Supply is low true okay and that's the case for diamonds that's why they are expensive but we are going to talk about how both of these things huh are a scam and manipulated okay okay diamonds are not really as rare as you make it out to be okay and the demand didn't really exist 100 years ago it was generated out of thin air by marketing demand didn't exist 100 years ago it wasn't this much okay right I thought diamonds were always like a favorite of Kings one of our Di went all the way to the UK and it's still there in

1m 33s somebody's Crown well see I mean it was there huh but not to the extent now right like now everybody who gets engaged wants a diamond Solita or wants to give a diamond let's not be okay okay sorry my B I was being um anyway H so about 150 years ago yeah diamonds were really rare yeah okay but what happened was that in the late 1800s new diamond mines were discovered in South Africa okay they were big right so suddenly the diamond Merchants began to worry that as the number of diamonds in the world increases the prices will fall yeah supply and demand basic economics what they did uh they they did not bunch of diamond Merchants got

2m 25s together they created a single company called deers which bought those mines and then for the next 100 and so many years they made sure that those diamonds don't come out and flood the market okay they artificially kept the supply of diamonds low I thought Deb was one single company are you trying to tell me it's a conglomerate of it start it was I mean that's how it started okay okay but then debers doesn't control all the mines in the world there was a time when they controlled more than 80% of of the supply of diamonds okay okay so that's part one keep the supply low so the demand is always high well no that that's part two how to increase the

3m 10s demand how do you increase the demand correct so deers went and found a very smart marketing company in the US okay and they got together and they spent like 10 15 years doing this okay how do you increase the demand step one make it glam okay make it so that all celebrities are talking about diamonds all uh I mean it could be movie stars but it could also be kings and queens okay okay so Marilyn Monro singing that Diamonds Are a Girl's Best Friend yes a lot of this was product placement by the diamond industry right are you serious Diamonds Are a girl best friend is a is product placement I don't know if this specific

3m 57s one is product placement but there was a lot of product placements like 20 years before that wow okay that's part one okay part two now people desire diamonds but you also have to give them and create occasions for them to buy diamonds right and that's where they started this concept of on your engagement you have to give a diamond a diamond ring part two of that was that it has to be expensive so they created occasions for people to buy diamonds through a lovely concept called costly signaling I speak a lot about costly signaling on this channel we have done an an entire episode on costly signaling which you should check out something that we can't resist through

4m 44s our Evolution okay but basic idea is that convince the world that a man's love for the woman is directly proportional to how much he spends on the diamond right that is the only costly signal anybody can claim to love but only the true person will spend a lot on the diamond and what is a lot two month salary because that was the campaign I remember they actually put that in their ads that if he doesn't spend at least two months of salary on the diamond he doesn't love her enough I fell for a marketing trick I didn't fall for a marketing people lots of people fell for a marketing trick third part of this is to create awareness and

5m 28s education okay now the problem with diamonds is that they all look similar yeah yeah right how do you convince someone that this diamond which looks almost the same as this diamond costs 10 times more so you go around in schools talking about the four C's of diamonds okay color Clarity cut and carrot okay so was propaganda as well they paid for these lectures to be given in schools where you tell everyone that oh well there are these like minute things that you can see under the microscope which make this diamond really more expensive than this other one okay and we fell for it the fact that these differ for it yeah these differences are visible only

6m 17s under a microscope and we still fell for it and you we continue to fall for it because this all of this has been known for at least 50 years right 50 years ago there was an article called have you tried to sell a diamond and until now it hasn't fallen but things are changing now yeah I yeah actually you can't sell a diamond because right so let's talk about one other important thing about diamonds right A lot of people yeah somehow managed to convince themselves that oh well it's I'm not just wasting money this is investment okay which kind of makes sense with gold okay you buy gold and then in times of trouble you sell the

6m 59s gold and you pretty much get most of the money yeah most of the value back right with the diamond it is not at all easy to sell a diamond because diamonds usually don't have resale value because people assume that diamonds are forever and they're never going to sell it well no I mean they have some resell value I mean you could if you tried really hard sell it for 80% of the cost okay okay that doesn't account for inflation at all that doesn't account for any return on investment correct okay and a lot of times the shop is just not going to take the diamond back they want to sell new diamonds you know what the supply is not

7m 37s that constrained correct okay correct so it's I mean if you wanted investment gold is much better Real Estate is much better mutual funds are the best to put it simply there is no secondary market for diamonds no secondary market for diamonds that's where I mean like I said check out the link the article have you tried to sell a diamond all right we'll put a Link in the description show another problem with diamonds okay I mean forget the economic arguments there's a moral argument also moral argument yes so a lot of diamond mines are in Africa in places where there isn't good governance okay what has happened yeah in the last century is that militant groups have managed to

8m 23s take over the diamond mines yeah and they use sales of those diamonds to fund their activities and not just diamonds a lot of precious and semi-precious stones correct sapphires emeralds these diamonds are called blood diamonds because anyone who buys a blood diamond is directly subsidizing some militant group killing other people in that area okay and genocide so and it's I look up the emerald mines of South Africa there is a lot to learn there there is a worldwide agreement to try to keep blood diamonds separate from regular Diamonds clean diamonds and so that you can buy clean diamonds but you shouldn't buy blood diamonds but it's a very porous like what there is no fair

9m 11s trade diamonds like Fair Trade coffee what absolutely there is they're called clean diamonds okay this painful I mean oh we haven't come to the painful part I haven't talked about the lab diamonds yet lab diamonds right see what is a diamond it is just carbon in a crystalline form in a crystalline form form yeah we know what carbon is we know where lots of carbon is and in a lab we put it under temperature and pressure and it becomes a diamond okay I've heard of lab grown diamonds I didn't know the procedure was this straightforward well it's it takes a long time like 300 hours to create one nice Diamond but but 300 hours is less time compared to 3 million

9m 51s years yes or 6 million or whatever the amount of time is what's your point the point is why aren't we using lab grown diamonds instead they are ethical they are clean they are simple they are straightforward they are quick they're cheaper they they're cheaper right guess what do you think why don't people use lab grown diamonds and by you he mean shutika who's sitting on the other side of the screen yeah let's have it let's what for shutika let's let's yeah give it up for shutika uh so the here in India people think he there is a lot of uh things happening there would be lot of things happening if you're wearing a diamond so

10m 31s so the you know there is a religious part or like spiritual part that people believe and the other thing is like the people who want to buy a diamond for you know as a uh I don't know shock to for them they if I'm buying just one for an entire for a lifetime then it has to be real because that is just going to be the one for me I said this is my person yeah but what's the difference between a real diamond and a lab grown diamond is there a difference um no I haven't studied that but I feel like if if we already know the composition so everything that is in nature almost all of it we can do it in

11m 12s Labs now so I feel like practically there is no difference so but in your head uh what would be the difference between a given given the option average person on the street what do you think they why do you think they want real diamonds and they will not buy a lab grown Diamond what is your impression like okay the main uh issue I feel here is ke when we go to the Jewelers now they never talk about lab grown diamonds they have they do not know this concept at all and then they say ke uh they get dark over time they lose their sign and all this is what they say but they actually don't know if there exist any

11m 50s something like which is you called as lab gr diamonds they do not talk about it at all there this there is great point right one is that there is an impression that lab grown diamonds are very different from real diamonds and they have properties which are not as good okay and second is oh the jewers absolutely know about this but it is against their profits to actually talk about this why ders and other Diamond people have gone to Great Lengths to create an entire campaign to first they spent lots of time trying to convince the whole world that there is a difference between them yeah turns out the difference is so tiny that you can't

12m 31s see the difference unless you use a microscope okay now imagine you are going to a wedding wearing a lab grown Diamond okay are all the people there coming with microscopes to check no right that will be a site people with mic I want to seeond about oh it'll get dark over time all of that is [ __ ] okay it's the same carbon yeah okay duers just does not want you to realize that they are the same thing so they are trying to create a difference yeah okay we did an episode on how do you get rich people to pay more for a certain thing and poor people pay less for the same thing you have to make the rich people

13m 16s believe that this is different and better du has been doing that okay with the diamond they will give you a written certificate saying this is a real diamond okay I hope you hang it with the necklace that certificate otherwise what's the point here is my diamond necklace and here is the certificate okay now the point is that because the market would collapse if this difference wasn't there duers makes it a point to keep the difference right and if a Jeweller tries to sell lap grown diamonds D will cut them off oh okay sounds to me like duers is increasingly getting desperate well no I mean so this what I said was the story from some time back okay well even

14m 04s ders couldn't keep away lab grown diamonds right so what they have done is you know if you can't lick them join them ders has started selling synthetic diamonds if you can't lick them join them yes that's a phrase nobody's licking Diamonds the the phrase is if you can't beat them join them licking diamonds it seems anyway go ons has joined the be have started selling synthetic diamonds and they are selling it for less than what the others are selling it for okay just to make the difference seem even more Stark it's like oh ders is this is like so so cheap it definitely has to be bad in some way right I am now waiting for the next de

14m 50s campaign where they are like if you really love her you have to buy a lab gr Diamond worth 2 months of your salary hope they'll come up with that campaign in the last year prices of lab grown diamonds have fallen 40% wow how long do you think ders can keep it up you know last century du knowing knowing ders they'll probably try and Corner the lab gr Diamond Market also problem the good news is that last century W had 80% of the market now they're at around 40% right they can't control the world as much as they could so hopefully or most likely two things are going to happen one is that lab grown diamonds which are

15m 33s generated using technology and there is absolutely no shortage of carbon around us right so technology will find ways of making them cheaper and cheaper and cheaper and at some point people will realize that there's no difference between these and the real thing so prices will crash right diamonds are forever duers is not forever you can fool all the people sometime and some people all the time but you can't fool all the people all the time yes and hopefully this episode will uh have taught you not to get fooled and hopefully uh you will see diamonds for what they are shiny little rocks and as long as some rock is shiny enough to catch your eye go ahead enjoy and if you

16m 22s can spend less for it why not well why not the reason is in our other episodes which is that it is about status and right now until the whole world sees this episode diamonds will continue to have status so what you should do is buy the cheap stones and then show everyone around you this episode okay na wonderful businessman mathematician and intelligent guy that episode he was talking about is right up here on your screen check that out it'll also be in the description show notes click that go for it Shri Kant naven future IQ status thank you for watching till the end if you like this episode check out these others you might like them also

17m 06s and please share with your friends I'm sure they will also like these thank you