Thursday, May 19, 2022

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    Why are diamonds so expensive?

    It’s no secret that diamonds represent beauty on luxurious levels.

    A diamond is metaphorically associated with beauty, strength, and power. Ancient people believed that diamonds are the tears of God.

    A diamond is the hardest material on the earth and the most expensive gemstone as well.

    However, you would be surprised to know that diamonds are intrinsically worthless! They are nothing but old rocks with carbon atoms that were exposed to high temperatures and pressure for billions of years. They are not rare either in fact, compared to other gemstones, diamonds are the least rare.

    So what makes diamonds so costly?

    In the 1800s diamonds were considered very rare until De Beers Mining company of South Africa found a large crater in Kimberley that contained a massive number of diamonds. This supply of diamonds would have made them much more available, and thus, much less expensive.

    Consequently, De Beers looked for an alternative to prevent diamonds from getting undervalued. So they looked at how many Americans were expected to get married that year and limited the diamonds they produced based on that number. They distributed a particular number of diamonds in batches.

    The rarer the stone, the higher the cost!

    The company’s advertising campaigns made the diamond engagement ring a symbol of marriage in America by portraying it as an excessively valuable entity in American movies. Due to this, the market demand for diamonds increased exponentially and the demand remains intact with other countries joining in too! Moreover, ancient Greeks worshipped the indestructible stone and believed it to have mystical powers. For centuries, diamonds have
    been worn by royalty and noblemen as a status symbol.

    The combined business strategies and rich history of diamonds increased its value even though intrinsically they are not worth that much.

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