Watch the evening news and wait for commodity prices to include diamonds. You won't see it. Markets don't trade diamonds. You and I sell houses and cars, but not diamonds. We can specify a price for copper and gold, but not for diamonds. Jewellers may talk price per carat, but where does that number come from?
In 2011 Wired did a piece on synthetic diamonds. A jeweller was presented with two gem sized yellow lab grown diamonds and couldn't tell if they were real or not. The price could have been $250,000 or $100. Each gem was created in a lab for about $100.
Diamonds like donuts, tend to stay off the market once sold. A commodity is something people buy and sell, anything useful. And that's why a diamond is not a commodity. The last person to buy your diamond turns out to be you. Diamonds, like donuts, rarely see second owners.
In 1990 DeBeers controlled 80% of the world's diamond market, down to about 35% today. Diamonds are an industry to be sure. They are just not an investment. The life of a Coach handbag, a donut and a diamond very much stops once you buy it.
Maybe that's what they mean by, "diamonds are forever." You will keep it forever because you can't really sell it. What is a diamond worth? Whatever you paid for it.
Seeing the obvious, seeing that the emperor really doesn't have clothes. Running companies, hiring managers. A pope gives two weeks notice, your accountant gives you a month. Obama thinks Boehner is the president and wants him to solve the budget cut problems. If 46 of your employees paid back expenses to avoid conflict, what would you do? That's exactly what 46 Canadian senators have done since 2010. Hyundai's engineering is on par with Audi, but the price is 30% lower. Can you see what's going on?
The management lesson here is that most of what we think is true, just ain't so. The second lesson is, if you just listen and watch very carefully, most of the information you need will present itself.
This week the USA housing market is showing huge gains. BC is looking good, and 2013 will be a great year.
Diamonds, donuts, who knew they were the same?
Wolfgang
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