I found the following links educational + informative.
7Stars Worldwide
A World of Dreams
Alam Assaat Wal Moujawharat
Arabian Watches & Jewellery
Bangkok Gems & Jewellery Magazine
Bijoux, montres & Vous
Brilho Fashion
BRJ Brasil Relógios & Jóias
China Gems Magazine
China Gold News
China Jewelry and Gold
CHRONOS China
CHRONOS Japan
CHRONOS Polen
Collection
Contessa Magazine
Cronos
Tuesday, December 19, 2006
Gem Business News
The Sri Lankan gemstone dealers are in town. They are downloading colored stones to potential buyers at competitive price (s). The political, social, business landscape in Sri Lanka has become unpredictable, and for this reason the local market is going to see more colored stones of all species and varieties. The dealers need cash and may be willing to compromise with price (s). You are going to see more sapphires in all color ranges and qualities.
Monday, December 18, 2006
Africa's Economy
Economist Intelligence Unit writes:
It should do well next year, if commodity prices stay high
The African economy is set for a fourth consecutive year of above-average growth, according to the World Bank's 2007 Global Economic Prospects, released on December 13th. Sub-Saharan GDP is forecast to increase by 5.3% in 2007—maintaining the average recorded over the 2004-06 period—and when South Africa (the region’s largest economy by far) is excluded, average growth rates are even more impressive, at 5.6% a year since 2003.
In 2006, oil exporters led the way with average growth of 6.9%, while (small) oil importers managed average expansion of 4.9%. Growth was broadly based, with one-third of the countries registering growth of more than 5%; indeed, only six states experienced declining incomes per head. This list includes two oil exporters, Gabon and Congo (Brazzaville), along with Eritrea, Swaziland, the Seychelles and Zimbabwe.
The World Bank attributes Africa’s “robust” economic expansion to favourable international conditions, improved economic policies in Africa itself, accelerated regional exports (to China especially), and higher commodity prices, most notably for oil and metals. Unfortunately, manufactured exports were hit by “intense competition from China and India”, and although both the US and the EU re-introduced quotas on Chinese clothing and textile exports to their markets, Sub-Saharan Africa’s clothing and textile exports to the US fell 17.3% while those to the EU were down 16.9%.
Going forward, growth in oil-exporting countries is projected to accelerate in line with increasing capacity in Angola (where output is expected to rise 20%) and Equatorial Guinea (up 8%), along with the normalisation of output levels in Nigeria, where production has been disrupted by civil strife in the Niger Delta. Average growth in oil producers is projected at 7.5% in 2007 and more than 7% in 2008, but depletion of existing oilfields will reduce GDP growth in Congo (Brazzaville) by one percentage point.
In the regional economic powerhouse, South Africa, growth will slow to less than 4% as higher interest rates affect domestic demand while inflation and rand depreciation accelerate. However, the World Bank does not anticipate serious problems in the country because rand depreciation should boost exports, notably in mining and manufacturing, while public-sector infrastructural investment will rise in the run-up to the 2010 World Cup.
The Bank expects growth in oil-importing countries to remain strong in 2007, at around 4.9%, due to improved rainfall in East and West Africa, and higher levels of investment and government spending as a result of debt relief and increased aid inflows; over the medium term, meanwhile, infrastructural investment should reduce the costs of doing business in Africa.
On the downside, lower world commodity prices will damp down growth while farm production will be hit by high fertiliser prices. Equally, while increased Chinese demand for cotton and reduced price subsidies in the US and EU should benefit cotton producers in West Africa, African manufacturers of clothing and textiles will most likely continue to lose market share to China and India.
Inflationary pressures are expected to subside as oil and other commodity prices weaken, but in South Africa inflation is expected to nudge above 6% in the first half of 2007 before slowing in the latter part of the year. Inflation is projected to slow to 4.6% in 2007 from 5.8% in 2006, before picking up slightly to 5% in 2008.
Despite lower oil prices in 2007-08 strong GDP growth and lower non-oil commodity prices will mean a further deterioration in the region’s current-account balance, which will deteriorate from surpluses of 0.8% of GDP in 2005 and 0.3% this year to a marginal deficit of 0.2% in 2007 and 0.9% in 2008.
Because Africa is so reliant on commodity exports, it is the region most vulnerable to any decline in energy and mineral prices. Overall agricultural prices are projected to fall marginally (by 1%) in 2007 and 3% in 2008. However, if oil prices remain high some agricultural prices are likely to rise, because higher oil prices increase the economic viability of biofuel, thereby generating additional demand for products like sugar and maize. The World Bank believes that metal prices have peaked and will decline in 2007-08, while oil prices are expected to slip to around US$53/barrel by 2008 (although they will remain highly volatile).
The African countries that are most vulnerable to a commodity price shakeout are oil and mineral exporters. But because the envisaged commodity price slowdown is only modest the overall impact on African growth is unlikely to be much more than 0.5%, reducing regional growth to 4.75% in 2007; in addition, countries that do not rely on oil/metal exports or are oil importers will actually be better off. In other words, unless there is an unexpectedly sharp fall in commodity prices 2007 looks set to be another good year for Sub-Saharan economies.
More info @ http://www.economist.com/daily/news/displaystory.cfm?story_id=8436140
It should do well next year, if commodity prices stay high
The African economy is set for a fourth consecutive year of above-average growth, according to the World Bank's 2007 Global Economic Prospects, released on December 13th. Sub-Saharan GDP is forecast to increase by 5.3% in 2007—maintaining the average recorded over the 2004-06 period—and when South Africa (the region’s largest economy by far) is excluded, average growth rates are even more impressive, at 5.6% a year since 2003.
In 2006, oil exporters led the way with average growth of 6.9%, while (small) oil importers managed average expansion of 4.9%. Growth was broadly based, with one-third of the countries registering growth of more than 5%; indeed, only six states experienced declining incomes per head. This list includes two oil exporters, Gabon and Congo (Brazzaville), along with Eritrea, Swaziland, the Seychelles and Zimbabwe.
The World Bank attributes Africa’s “robust” economic expansion to favourable international conditions, improved economic policies in Africa itself, accelerated regional exports (to China especially), and higher commodity prices, most notably for oil and metals. Unfortunately, manufactured exports were hit by “intense competition from China and India”, and although both the US and the EU re-introduced quotas on Chinese clothing and textile exports to their markets, Sub-Saharan Africa’s clothing and textile exports to the US fell 17.3% while those to the EU were down 16.9%.
Going forward, growth in oil-exporting countries is projected to accelerate in line with increasing capacity in Angola (where output is expected to rise 20%) and Equatorial Guinea (up 8%), along with the normalisation of output levels in Nigeria, where production has been disrupted by civil strife in the Niger Delta. Average growth in oil producers is projected at 7.5% in 2007 and more than 7% in 2008, but depletion of existing oilfields will reduce GDP growth in Congo (Brazzaville) by one percentage point.
In the regional economic powerhouse, South Africa, growth will slow to less than 4% as higher interest rates affect domestic demand while inflation and rand depreciation accelerate. However, the World Bank does not anticipate serious problems in the country because rand depreciation should boost exports, notably in mining and manufacturing, while public-sector infrastructural investment will rise in the run-up to the 2010 World Cup.
The Bank expects growth in oil-importing countries to remain strong in 2007, at around 4.9%, due to improved rainfall in East and West Africa, and higher levels of investment and government spending as a result of debt relief and increased aid inflows; over the medium term, meanwhile, infrastructural investment should reduce the costs of doing business in Africa.
On the downside, lower world commodity prices will damp down growth while farm production will be hit by high fertiliser prices. Equally, while increased Chinese demand for cotton and reduced price subsidies in the US and EU should benefit cotton producers in West Africa, African manufacturers of clothing and textiles will most likely continue to lose market share to China and India.
Inflationary pressures are expected to subside as oil and other commodity prices weaken, but in South Africa inflation is expected to nudge above 6% in the first half of 2007 before slowing in the latter part of the year. Inflation is projected to slow to 4.6% in 2007 from 5.8% in 2006, before picking up slightly to 5% in 2008.
Despite lower oil prices in 2007-08 strong GDP growth and lower non-oil commodity prices will mean a further deterioration in the region’s current-account balance, which will deteriorate from surpluses of 0.8% of GDP in 2005 and 0.3% this year to a marginal deficit of 0.2% in 2007 and 0.9% in 2008.
Because Africa is so reliant on commodity exports, it is the region most vulnerable to any decline in energy and mineral prices. Overall agricultural prices are projected to fall marginally (by 1%) in 2007 and 3% in 2008. However, if oil prices remain high some agricultural prices are likely to rise, because higher oil prices increase the economic viability of biofuel, thereby generating additional demand for products like sugar and maize. The World Bank believes that metal prices have peaked and will decline in 2007-08, while oil prices are expected to slip to around US$53/barrel by 2008 (although they will remain highly volatile).
The African countries that are most vulnerable to a commodity price shakeout are oil and mineral exporters. But because the envisaged commodity price slowdown is only modest the overall impact on African growth is unlikely to be much more than 0.5%, reducing regional growth to 4.75% in 2007; in addition, countries that do not rely on oil/metal exports or are oil importers will actually be better off. In other words, unless there is an unexpectedly sharp fall in commodity prices 2007 looks set to be another good year for Sub-Saharan economies.
More info @ http://www.economist.com/daily/news/displaystory.cfm?story_id=8436140
Person Of The Year: You
Lev Grossman (Times Magazine) writes:
Yes, you. You control the Information Age. Welcome to your world.
The "Great Man" theory of history is usually attributed to the Scottish philosopher Thomas Carlyle, who wrote that "the history of the world is but the biography of great men." He believed that it is the few, the powerful and the famous who shape our collective destiny as a species. That theory took a serious beating this year.
To be sure, there are individuals we could blame for the many painful and disturbing things that happened in 2006. The conflict in Iraq only got bloodier and more entrenched. A vicious skirmish erupted between Israel and Lebanon. A war dragged on in Sudan. A tin-pot dictator in North Korea got the Bomb, and the President of Iran wants to go nuclear too. Meanwhile nobody fixed global warming, and Sony didn't make enough PlayStation3s.
But look at 2006 through a different lens and you'll see another story, one that isn't about conflict or great men. It's a story about community and collaboration on a scale never seen before. It's about the cosmic compendium of knowledge Wikipedia and the million-channel people's network YouTube and the online metropolis MySpace. It's about the many wresting power from the few and helping one another for nothing and how that will not only change the world, but also change the way the world changes.
The tool that makes this possible is the World Wide Web. Not the Web that Tim Berners-Lee hacked together (15 years ago, according to Wikipedia) as a way for scientists to share research. It's not even the overhyped dotcom Web of the late 1990s. The new Web is a very different thing. It's a tool for bringing together the small contributions of millions of people and making them matter. Silicon Valley consultants call it Web 2.0, as if it were a new version of some old software. But it's really a revolution.
And we are so ready for it. We're ready to balance our diet of predigested news with raw feeds from Baghdad and Boston and Beijing. You can learn more about how Americans live just by looking at the backgrounds of YouTube videos—those rumpled bedrooms and toy-strewn basement rec rooms—than you could from 1,000 hours of network television.
And we didn't just watch, we also worked. Like crazy. We made Facebook profiles and Second Life avatars and reviewed books at Amazon and recorded podcasts. We blogged about our candidates losing and wrote songs about getting dumped. We camcordered bombing runs and built open-source software.
America loves its solitary geniuses—its Einsteins, its Edisons, its Jobses—but those lonely dreamers may have to learn to play with others. Car companies are running open design contests. Reuters is carrying blog postings alongside its regular news feed. Microsoft is working overtime to fend off user-created Linux. We're looking at an explosion of productivity and innovation, and it's just getting started, as millions of minds that would otherwise have drowned in obscurity get backhauled into the global intellectual economy.
Who are these people? Seriously, who actually sits down after a long day at work and says, I'm not going to watch Lost tonight. I'm going to turn on my computer and make a movie starring my pet iguana? I'm going to mash up 50 Cent's vocals with Queen's instrumentals? I'm going to blog about my state of mind or the state of the nation or the steak-frites at the new bistro down the street? Who has that time and that energy and that passion?
The answer is, you do. And for seizing the reins of the global media, for founding and framing the new digital democracy, for working for nothing and beating the pros at their own game, TIME's Person of the Year for 2006 is you.
Sure, it's a mistake to romanticize all this any more than is strictly necessary. Web 2.0 harnesses the stupidity of crowds as well as its wisdom. Some of the comments on YouTube make you weep for the future of humanity just for the spelling alone, never mind the obscenity and the naked hatred.
But that's what makes all this interesting. Web 2.0 is a massive social experiment, and like any experiment worth trying, it could fail. There's no road map for how an organism that's not a bacterium lives and works together on this planet in numbers in excess of 6 billion. But 2006 gave us some ideas. This is an opportunity to build a new kind of international understanding, not politician to politician, great man to great man, but citizen to citizen, person to person. It's a chance for people to look at a computer screen and really, genuinely wonder who's out there looking back at them. Go on. Tell us you're not just a little bit curious.
More info @ http://www.time.com/time/magazine/article/0,9171,1569514,00.html?aid=434&from=o&to=http%3A//www.time.com/time/magazine/article/0%2C9171%2C1569514%2C00.html
Yes, you. You control the Information Age. Welcome to your world.
The "Great Man" theory of history is usually attributed to the Scottish philosopher Thomas Carlyle, who wrote that "the history of the world is but the biography of great men." He believed that it is the few, the powerful and the famous who shape our collective destiny as a species. That theory took a serious beating this year.
To be sure, there are individuals we could blame for the many painful and disturbing things that happened in 2006. The conflict in Iraq only got bloodier and more entrenched. A vicious skirmish erupted between Israel and Lebanon. A war dragged on in Sudan. A tin-pot dictator in North Korea got the Bomb, and the President of Iran wants to go nuclear too. Meanwhile nobody fixed global warming, and Sony didn't make enough PlayStation3s.
But look at 2006 through a different lens and you'll see another story, one that isn't about conflict or great men. It's a story about community and collaboration on a scale never seen before. It's about the cosmic compendium of knowledge Wikipedia and the million-channel people's network YouTube and the online metropolis MySpace. It's about the many wresting power from the few and helping one another for nothing and how that will not only change the world, but also change the way the world changes.
The tool that makes this possible is the World Wide Web. Not the Web that Tim Berners-Lee hacked together (15 years ago, according to Wikipedia) as a way for scientists to share research. It's not even the overhyped dotcom Web of the late 1990s. The new Web is a very different thing. It's a tool for bringing together the small contributions of millions of people and making them matter. Silicon Valley consultants call it Web 2.0, as if it were a new version of some old software. But it's really a revolution.
And we are so ready for it. We're ready to balance our diet of predigested news with raw feeds from Baghdad and Boston and Beijing. You can learn more about how Americans live just by looking at the backgrounds of YouTube videos—those rumpled bedrooms and toy-strewn basement rec rooms—than you could from 1,000 hours of network television.
And we didn't just watch, we also worked. Like crazy. We made Facebook profiles and Second Life avatars and reviewed books at Amazon and recorded podcasts. We blogged about our candidates losing and wrote songs about getting dumped. We camcordered bombing runs and built open-source software.
America loves its solitary geniuses—its Einsteins, its Edisons, its Jobses—but those lonely dreamers may have to learn to play with others. Car companies are running open design contests. Reuters is carrying blog postings alongside its regular news feed. Microsoft is working overtime to fend off user-created Linux. We're looking at an explosion of productivity and innovation, and it's just getting started, as millions of minds that would otherwise have drowned in obscurity get backhauled into the global intellectual economy.
Who are these people? Seriously, who actually sits down after a long day at work and says, I'm not going to watch Lost tonight. I'm going to turn on my computer and make a movie starring my pet iguana? I'm going to mash up 50 Cent's vocals with Queen's instrumentals? I'm going to blog about my state of mind or the state of the nation or the steak-frites at the new bistro down the street? Who has that time and that energy and that passion?
The answer is, you do. And for seizing the reins of the global media, for founding and framing the new digital democracy, for working for nothing and beating the pros at their own game, TIME's Person of the Year for 2006 is you.
Sure, it's a mistake to romanticize all this any more than is strictly necessary. Web 2.0 harnesses the stupidity of crowds as well as its wisdom. Some of the comments on YouTube make you weep for the future of humanity just for the spelling alone, never mind the obscenity and the naked hatred.
But that's what makes all this interesting. Web 2.0 is a massive social experiment, and like any experiment worth trying, it could fail. There's no road map for how an organism that's not a bacterium lives and works together on this planet in numbers in excess of 6 billion. But 2006 gave us some ideas. This is an opportunity to build a new kind of international understanding, not politician to politician, great man to great man, but citizen to citizen, person to person. It's a chance for people to look at a computer screen and really, genuinely wonder who's out there looking back at them. Go on. Tell us you're not just a little bit curious.
More info @ http://www.time.com/time/magazine/article/0,9171,1569514,00.html?aid=434&from=o&to=http%3A//www.time.com/time/magazine/article/0%2C9171%2C1569514%2C00.html
Best Business Books: 2006
Strategy + Business writes:
This year’s best books can help identify patterns in the seemingly unpredictable.
1. The Future by Howard Rheingold
2. Economics by Michael Schrage
3. Marketing by Nick Wreden
4. Media by Nell Minow
5. Negotiation by Nikos Mourkogiannis
6. Strategy by Chuck Lucier and Jan Dyer
7. Governance by Michelle Leder
8. Management by David K. Hurst
9. The Business of Defense by Dov S. Zakheim
10. Fiction by Jonathan Weber
11. Leadership by James O’Toole
More info @ http://www.strategy-business.com/press/freearticle/06407
This year’s best books can help identify patterns in the seemingly unpredictable.
1. The Future by Howard Rheingold
2. Economics by Michael Schrage
3. Marketing by Nick Wreden
4. Media by Nell Minow
5. Negotiation by Nikos Mourkogiannis
6. Strategy by Chuck Lucier and Jan Dyer
7. Governance by Michelle Leder
8. Management by David K. Hurst
9. The Business of Defense by Dov S. Zakheim
10. Fiction by Jonathan Weber
11. Leadership by James O’Toole
More info @ http://www.strategy-business.com/press/freearticle/06407
Sunday, December 17, 2006
All That Glisters...
The Economist writes:
A lot of cities harbour the desire to become a financial centre. Nowhere, however, has been as bold as Dubai
THE sprawling gold souk in the old quarter of Deira is testament to Dubai's history as a staging post along ancient Middle Eastern trade routes. But today the stalls selling glittering bangles attract more tourists than traders. The serious money is pouring into the other, newer Dubai emerging from a forest of construction cranes in the desert a few miles to the south. There, amid some of the world's most luxurious hotels, apartments and shopping malls, the emirate's most audacious gamble is taking shape.
The Dubai International Financial Centre is a small city-within-a-city, clustered around a striking building known as “the Gate”. It is an attempt by the ruling al-Maktoum family and a close-knit web of their business partners to build a global centre for financial services. “Our goal is to put Dubai's clock up on the walls of the world's financial institutions, in a slot between Hong Kong, Singapore and London,” says Nasser Alshaali, a senior official with the centre's new financial exchange.
As capital is becoming more mobile, an unprecedented opportunity exists for cities to join the competition for international financial business. São Paulo, Shanghai, Kuala Lumpur, Johannesburg and Istanbul are all aspiring to become regional financial centres. To succeed, they must meet the needs of international bankers and financiers: transport links, sound regulatory and legal systems, technological sophistication, a good quality of life for expatriate bankers and liquid capital markets (often sustained by an emerging middle class).
Hong Kong and Singapore can already tick all of these boxes. Dubai means to do the same. But the emirate is in a hurry. Instead of building itself up bit by bit and slowly gaining the confidence of financiers—as London and New York did over decades—it is trying to buy its place at the table. Fifteen months after it opened and despite billions of dollars of investments, the results have been mixed and there is scepticism at just how successful it can be. But these are early days.
Dubai starts with considerable advantages. It sits in a region awash with money—thanks largely to surging oil revenues. Financiers reckon that up to $2 trillion in investments come from the Gulf region, the bulk of which is parked abroad, often as American treasury bills and in places like Switzerland and London. But increasingly, money is staying closer to home. According to a report by Capgemini and Merrill Lynch, the number of people in the Middle East with more than $1m in financial assets rose by nearly 10%, to 300,000, last year. The number of very rich is expected to jump to 1.8m by 2010. Governments in the region are also spending billions of dollars on infrastructure, and national investment agencies are on the prowl for things to put their cash into.
No wonder global financial firms are increasing the breadth and depth of their operations in the Middle East. A handful of big banks has been in the region for decades. HSBC, for instance, has operated in Dubai for 60 years. But in the past they were restricted to areas such as commercial banking. As rules have been loosened, more investment banks, insurers, fund managers, private-equity firms and even a few hedge funds have arrived.
Dubai wants them all. It is chasing business not only from the Middle East, but also from countries farther east, such as India. The financial centre is trying to attract corporate and investment banking, private banking, capital markets, asset management, fund administration, reinsurance, Islamic finance and back-office operations. Accordingly, the Dubai financial centre has been granted its own commercial laws, regulators and courts. It is an oasis within the more traditional bureaucratic and legal systems in force elsewhere in Dubai—not to mention the region as a whole.
The rulers' backing
The city is also setting up new markets. Although the Dubai International Financial Exchange is only 15 months old, Dubai will soon open a commodities exchange as well. This will work in partnership with the New York Mercantile Exchange, offering as its main product a new oil-futures contact based on Omani crude, which officials hope will become a new world benchmark. In a sign of Dubai's growing influence, the government of neighbouring Oman recently took a 30% stake in the commodities exchange.
Behind much of this lies a second advantage: the firm hand and deep pockets of Dubai's ruling family. Companies are lured to Dubai by incentives that, so far, are unmatched in the region.
“They have taken some of the best from Bermuda and Switzerland and are combining those concepts,” says Michael Klein, a senior executive with Citigroup. The deals on offer include zero tax on income and profits, 100% foreign ownership, no restrictions on foreign exchange or repatriation of profits, and relatively transparent light-touch regulation (with laws borrowed heavily from Britain and Australia). Even the regulators have been imported.
Thanks to these incentives, coupled with tireless marketing and Dubai's reputation as a relatively comfortable place to live and work, a trickle of interest has turned into a small stampede. The centre aims to become home to 250 international financial firms by 2009; so far, several dozen have set up shop. Two giants, Deutsche Bank and Credit Suisse, arrived early. Since then a gaggle of well-known firms, such as Goldman Sachs and Lehman Brothers, have moved in or plan to do so.
Morgan Stanley, which opened an office last spring, is the sort of firm that local officials love.
“Dubai has done it right,” says George Makhoul, a Lebanese-born manager who runs the investment bank's operations in the Middle East and North Africa. “They built it and then said come get it.” The firm more than doubled its regional revenues in its first six months, he says. Although its usual practice is to enter a new market one step at a time, starting with investment banking, Morgan Stanley offered its full array of wholesale financial services in Dubai from the outset. “You can't get in just by getting your toes wet,” adds Mr Makhoul. Given the demand, “our strategy was probably justified in the first week.”
Dubai's third advantage is a history of pulling off grand schemes. Blessed with fewer oil or gas deposits than its neighbours, the emirate has long sought other ways to make a living and has thrived as a trading entrepot living off its wits. “When I look at Dubai, I think of Amsterdam in the 16th century,” says Saskia Sassen, a sociologist at the University of Chicago, who studies global cities. “Dubai is not a six-month miracle.”
Dubai's big successes include the Jebel Ali container port; a world-class airport; a leading airline in Emirates; duty-free stores that would exhaust the most indefatigable shopper; the world's first seven-star hotel; luxury beach resorts; regional centres for media and health care; as well as more unusual projects, including man-made islands in fantastic shapes. The world's tallest building, the Burj Dubai, is also under construction. All this helps to attract celebrities, from Saudi princes to Russian plutocrats and professional footballers, who often buy homes. Although some find it all a bit tacky, Dubai has shown imagination, a knack for getting things done, and an ability to harness capital and use top international talent.
Not everyone is convinced that Dubai's financial designs will be so profitable.
“People are committing too many resources to the region,” says a private-equity manager associated with one of the Gulf's big investment firms. “If the whole world is coming to Dubai to do business, they're going to be disappointed,” adds a banker who sits on the financial exchange's board. “There's not enough business for 30 global financial institutions.”
Even Morgan Stanley's Mr Makhoul admits that, given the wide variety of firms the centre is courting, the time is approaching for Dubai to produce more results. “It seems there's an abundance of initiatives,” he says. “We'd like to see some of these things come to fruition.”
Below expectations
Whereas international banks report an increase in their institutional securities business (mergers and acquisitions, for instance), the volume of trading on the Dubai International Financial Exchange has been disappointing. Until the market becomes bigger and more liquid, successful public offerings will be hard to attract. And financiers complain that Dubai's rulers, despite many hopes, have not yet floated some of its successful state-owned ventures on the exchange. “If the exchange is so great, why is the Dubai government not using it?” asks a former regulator.
An international banker on the exchange's board agrees that the shortage of initial offerings is a problem. He suggests that the big banks will give the market another six to 12 months to get products trading with good liquidity before they reconsider their involvement. “The basic question people are asking is, ‘is this a place to raise money or not, a place to access capital in the region?'” he says. “People need to clearly think this is going in the right direction.”
Predictably, Mr Alshaali, the local official, defends the government. “We don't expect to force a listing of one of its assets,” he says. But he acknowledges that volatile conditions in the region's stockmarkets this year—some indices have plunged by as much as 60%—have made the timing of public listings awkward.
Mr Alshaali points out that both issuers and investors are more careful nowadays. The cautious mood extends throughout the region, where even taxi drivers poured their cash into fledgling stockmarkets only to see their money evaporate. It came as a shock to first-time investors, says Nasser Saidi, a Lebanese-born economist working at the Dubai financial centre: “Everyone thought the only way was up.” Niall Booker, head of HSBC's banking operations in the Middle East, notes that boom-and-bust cycles are typical of emerging markets. Now, he says, valuations have become more realistic.
The test of Dubai's financial sticking power will be its ability to bring together those who offer capital and those who need it. There are growing indications that Middle Eastern companies want to tap public markets to expand abroad, for instance, and Dubai's successful offering of the world's biggest sukuk—in effect, an Islamic bond—earlier this year raised hopes.
Much rests on the independence and legitimacy of Dubai's regulators. An early problem was the resignation of some well-known expatriates brought in to oversee the centre and its exchange. They claimed that local officials were improperly meddling, although the locals insist it was all a “cultural misunderstanding”. Indeed, there has been something of a revolving door for foreign executives. The latest arrival is a former head of OMX, the operator of a successful Scandinavian financial exchange, who took over running the financial exchange earlier this year.
One of the biggest difficulties in the Gulf is its notoriously opaque business culture. “We don't want to do business in hotel lobbies,” says Morgan Stanley's Mr Makhoul. “We're trying to bring a global standard to the market, not just do deals.” Yet a recent report from Hawkamah, a corporate-governance institute headed by Mr Saidi, concluded that regional business practices fall well behind Western standards of transparency and accounting. This may not be so surprising considering that about 85% of firms in the region are family-owned.
Putting down cash
If Dubai is to succeed in its ambition, other practices must also change. The emirate has a long-standing reputation for smuggling and money-laundering—the terrorists who struck on September 11th 2001 transferred some of their funds through Dubai. The financial centre has worked hard to show Western governments that it has cracked down, but elsewhere in Dubai it is not uncommon to hear stories about pricey luxury apartments paid for in cash by rich Russians who rarely visit.
Because the financial centre was created from scratch with a commitment to transparency and international standards, its officials say such worries are unfounded. Yet, in private, Western financial executives operating in Dubai remain on guard about accepting potentially dirty funds. “There is money here from questionable sources, which is very tempting,” says one executive whose firm recently opened in the centre. “We haven't turned down money yet, but I expect it will happen. We have to know our investors.”
The questions of image and security go wider. Expatriate circles gossip about how the ruling family tries to protect the emirate from threats like that of al-Qaeda. One line of defence is an elaborate intelligence network. Another is strict immigration controls. Migrant labour is a sensitive issue. “The entire economy is run on the backs of migrant workers,” claims Hadi Ghaemi of Human Rights Watch. More than 80% of workers in the United Arab Emirates' private sector are migrants. Despite a series of protests against low pay and poor working conditions, the government has taken little action. Trade unions and strikes are banned. Human Rights Watch found that 34 site-related deaths of construction workers were reported to the Dubai government in 2004, but Mr Ghaemi says it counted 880 dead bodies sent home by foreign embassies the same year. “They can't explain the deaths,” he adds.
As in other city states with firm controls, Dubai also keeps a grip on the media. Journalists exercise self-censorship, steering clear of stories critical of the ruling family or anything that might damage the economy. Even Skype, the free internet-phone service, is banned in order to protect the local telecoms provider. It remains to be seen whether such restrictions will continue as the UAE inches toward democracy—it will hold limited elections for the legislature in the coming week.
So far, the flush of new wealth and relatively good quality of life have trumped such issues in the minds of foreign investors. Expatriates worry aloud more about spiralling inflation and grinding traffic jams. If inflation continues unabated, the UAE “faces the danger of pricing itself out of the low end of the processing market in banking and insurance,” says Mr Booker.
There is a recognition that if tiny Dubai can succeed as a money giant, it will be tied closely to its role as a gateway to the Gulf, much as Hong Kong is a gateway to China. Yet it is not the first place to dream of becoming a Middle Eastern financial hub. Beirut filled that role until war wrecked its economy in the 1980s and investors shifted toward the Gulf. Bahrain, Qatar and Kuwait have all since found their niches. Abu Dhabi, a rival next door with its own financial ambitions is now trying to become a place for the arts. It has signed a deal to build the world's biggest Guggenheim museum and is in talks to build an offshoot of the Louvre as well.
One obstacle for other countries in the region is the life they offer foreigners. Many are seen as relatively strict and dull places to live. But Dubai is not. “We're living in an Islamic ocean and we're a tiny common-law island,” says Sandy Shipton, an expatriate executive at the Dubai financial centre.
One country with a particular bearing in Dubai is Saudi Arabia. So far, its conservative culture and restrictive religious practices have led many international firms to try to serve the country from regional offices in Dubai; other executives who work there park their families in Dubai and fly back at weekends. But the Saudis are becoming more demanding: they now require a business licence and a Saudi office for foreign firms doing business in their country. Work has also started on a new commercial hub called King Abdullah City, near Jeddah, that will target global firms.
Despite all the jockeying for the attention of international financiers, some see the emergence of several financial hubs in the Middle East as a healthy sign. Indeed, one possibility is the growth of various centres of excellence. “The new reality is you can have a very capable network,” says Ms Sassen. “It's not simply a winner-take-all situation.” She cites Singapore's ties with the Chinese city of Shenzhen as an example of regional collaboration.
Executives at the Dubai financial centre see the parallels with Asia and increasingly promote it as a complement to places like Singapore, rather than a competitor for them. The Omani oil-futures contract, for instance, was chosen as a benchmark for the new Dubai commodities exchange in part because the contract is used by oil traders in Singapore.
Dubai has spent a fortune and done virtually everything within its power to establish an attractive market. In the end, though, successful financial centres cannot be created by government fiat. Success now depends on forces that are largely beyond its control.
More info @ http://www.economist.com/finance/displaystory.cfm?story_id=8422344
A lot of cities harbour the desire to become a financial centre. Nowhere, however, has been as bold as Dubai
THE sprawling gold souk in the old quarter of Deira is testament to Dubai's history as a staging post along ancient Middle Eastern trade routes. But today the stalls selling glittering bangles attract more tourists than traders. The serious money is pouring into the other, newer Dubai emerging from a forest of construction cranes in the desert a few miles to the south. There, amid some of the world's most luxurious hotels, apartments and shopping malls, the emirate's most audacious gamble is taking shape.
The Dubai International Financial Centre is a small city-within-a-city, clustered around a striking building known as “the Gate”. It is an attempt by the ruling al-Maktoum family and a close-knit web of their business partners to build a global centre for financial services. “Our goal is to put Dubai's clock up on the walls of the world's financial institutions, in a slot between Hong Kong, Singapore and London,” says Nasser Alshaali, a senior official with the centre's new financial exchange.
As capital is becoming more mobile, an unprecedented opportunity exists for cities to join the competition for international financial business. São Paulo, Shanghai, Kuala Lumpur, Johannesburg and Istanbul are all aspiring to become regional financial centres. To succeed, they must meet the needs of international bankers and financiers: transport links, sound regulatory and legal systems, technological sophistication, a good quality of life for expatriate bankers and liquid capital markets (often sustained by an emerging middle class).
Hong Kong and Singapore can already tick all of these boxes. Dubai means to do the same. But the emirate is in a hurry. Instead of building itself up bit by bit and slowly gaining the confidence of financiers—as London and New York did over decades—it is trying to buy its place at the table. Fifteen months after it opened and despite billions of dollars of investments, the results have been mixed and there is scepticism at just how successful it can be. But these are early days.
Dubai starts with considerable advantages. It sits in a region awash with money—thanks largely to surging oil revenues. Financiers reckon that up to $2 trillion in investments come from the Gulf region, the bulk of which is parked abroad, often as American treasury bills and in places like Switzerland and London. But increasingly, money is staying closer to home. According to a report by Capgemini and Merrill Lynch, the number of people in the Middle East with more than $1m in financial assets rose by nearly 10%, to 300,000, last year. The number of very rich is expected to jump to 1.8m by 2010. Governments in the region are also spending billions of dollars on infrastructure, and national investment agencies are on the prowl for things to put their cash into.
No wonder global financial firms are increasing the breadth and depth of their operations in the Middle East. A handful of big banks has been in the region for decades. HSBC, for instance, has operated in Dubai for 60 years. But in the past they were restricted to areas such as commercial banking. As rules have been loosened, more investment banks, insurers, fund managers, private-equity firms and even a few hedge funds have arrived.
Dubai wants them all. It is chasing business not only from the Middle East, but also from countries farther east, such as India. The financial centre is trying to attract corporate and investment banking, private banking, capital markets, asset management, fund administration, reinsurance, Islamic finance and back-office operations. Accordingly, the Dubai financial centre has been granted its own commercial laws, regulators and courts. It is an oasis within the more traditional bureaucratic and legal systems in force elsewhere in Dubai—not to mention the region as a whole.
The rulers' backing
The city is also setting up new markets. Although the Dubai International Financial Exchange is only 15 months old, Dubai will soon open a commodities exchange as well. This will work in partnership with the New York Mercantile Exchange, offering as its main product a new oil-futures contact based on Omani crude, which officials hope will become a new world benchmark. In a sign of Dubai's growing influence, the government of neighbouring Oman recently took a 30% stake in the commodities exchange.
Behind much of this lies a second advantage: the firm hand and deep pockets of Dubai's ruling family. Companies are lured to Dubai by incentives that, so far, are unmatched in the region.
“They have taken some of the best from Bermuda and Switzerland and are combining those concepts,” says Michael Klein, a senior executive with Citigroup. The deals on offer include zero tax on income and profits, 100% foreign ownership, no restrictions on foreign exchange or repatriation of profits, and relatively transparent light-touch regulation (with laws borrowed heavily from Britain and Australia). Even the regulators have been imported.
Thanks to these incentives, coupled with tireless marketing and Dubai's reputation as a relatively comfortable place to live and work, a trickle of interest has turned into a small stampede. The centre aims to become home to 250 international financial firms by 2009; so far, several dozen have set up shop. Two giants, Deutsche Bank and Credit Suisse, arrived early. Since then a gaggle of well-known firms, such as Goldman Sachs and Lehman Brothers, have moved in or plan to do so.
Morgan Stanley, which opened an office last spring, is the sort of firm that local officials love.
“Dubai has done it right,” says George Makhoul, a Lebanese-born manager who runs the investment bank's operations in the Middle East and North Africa. “They built it and then said come get it.” The firm more than doubled its regional revenues in its first six months, he says. Although its usual practice is to enter a new market one step at a time, starting with investment banking, Morgan Stanley offered its full array of wholesale financial services in Dubai from the outset. “You can't get in just by getting your toes wet,” adds Mr Makhoul. Given the demand, “our strategy was probably justified in the first week.”
Dubai's third advantage is a history of pulling off grand schemes. Blessed with fewer oil or gas deposits than its neighbours, the emirate has long sought other ways to make a living and has thrived as a trading entrepot living off its wits. “When I look at Dubai, I think of Amsterdam in the 16th century,” says Saskia Sassen, a sociologist at the University of Chicago, who studies global cities. “Dubai is not a six-month miracle.”
Dubai's big successes include the Jebel Ali container port; a world-class airport; a leading airline in Emirates; duty-free stores that would exhaust the most indefatigable shopper; the world's first seven-star hotel; luxury beach resorts; regional centres for media and health care; as well as more unusual projects, including man-made islands in fantastic shapes. The world's tallest building, the Burj Dubai, is also under construction. All this helps to attract celebrities, from Saudi princes to Russian plutocrats and professional footballers, who often buy homes. Although some find it all a bit tacky, Dubai has shown imagination, a knack for getting things done, and an ability to harness capital and use top international talent.
Not everyone is convinced that Dubai's financial designs will be so profitable.
“People are committing too many resources to the region,” says a private-equity manager associated with one of the Gulf's big investment firms. “If the whole world is coming to Dubai to do business, they're going to be disappointed,” adds a banker who sits on the financial exchange's board. “There's not enough business for 30 global financial institutions.”
Even Morgan Stanley's Mr Makhoul admits that, given the wide variety of firms the centre is courting, the time is approaching for Dubai to produce more results. “It seems there's an abundance of initiatives,” he says. “We'd like to see some of these things come to fruition.”
Below expectations
Whereas international banks report an increase in their institutional securities business (mergers and acquisitions, for instance), the volume of trading on the Dubai International Financial Exchange has been disappointing. Until the market becomes bigger and more liquid, successful public offerings will be hard to attract. And financiers complain that Dubai's rulers, despite many hopes, have not yet floated some of its successful state-owned ventures on the exchange. “If the exchange is so great, why is the Dubai government not using it?” asks a former regulator.
An international banker on the exchange's board agrees that the shortage of initial offerings is a problem. He suggests that the big banks will give the market another six to 12 months to get products trading with good liquidity before they reconsider their involvement. “The basic question people are asking is, ‘is this a place to raise money or not, a place to access capital in the region?'” he says. “People need to clearly think this is going in the right direction.”
Predictably, Mr Alshaali, the local official, defends the government. “We don't expect to force a listing of one of its assets,” he says. But he acknowledges that volatile conditions in the region's stockmarkets this year—some indices have plunged by as much as 60%—have made the timing of public listings awkward.
Mr Alshaali points out that both issuers and investors are more careful nowadays. The cautious mood extends throughout the region, where even taxi drivers poured their cash into fledgling stockmarkets only to see their money evaporate. It came as a shock to first-time investors, says Nasser Saidi, a Lebanese-born economist working at the Dubai financial centre: “Everyone thought the only way was up.” Niall Booker, head of HSBC's banking operations in the Middle East, notes that boom-and-bust cycles are typical of emerging markets. Now, he says, valuations have become more realistic.
The test of Dubai's financial sticking power will be its ability to bring together those who offer capital and those who need it. There are growing indications that Middle Eastern companies want to tap public markets to expand abroad, for instance, and Dubai's successful offering of the world's biggest sukuk—in effect, an Islamic bond—earlier this year raised hopes.
Much rests on the independence and legitimacy of Dubai's regulators. An early problem was the resignation of some well-known expatriates brought in to oversee the centre and its exchange. They claimed that local officials were improperly meddling, although the locals insist it was all a “cultural misunderstanding”. Indeed, there has been something of a revolving door for foreign executives. The latest arrival is a former head of OMX, the operator of a successful Scandinavian financial exchange, who took over running the financial exchange earlier this year.
One of the biggest difficulties in the Gulf is its notoriously opaque business culture. “We don't want to do business in hotel lobbies,” says Morgan Stanley's Mr Makhoul. “We're trying to bring a global standard to the market, not just do deals.” Yet a recent report from Hawkamah, a corporate-governance institute headed by Mr Saidi, concluded that regional business practices fall well behind Western standards of transparency and accounting. This may not be so surprising considering that about 85% of firms in the region are family-owned.
Putting down cash
If Dubai is to succeed in its ambition, other practices must also change. The emirate has a long-standing reputation for smuggling and money-laundering—the terrorists who struck on September 11th 2001 transferred some of their funds through Dubai. The financial centre has worked hard to show Western governments that it has cracked down, but elsewhere in Dubai it is not uncommon to hear stories about pricey luxury apartments paid for in cash by rich Russians who rarely visit.
Because the financial centre was created from scratch with a commitment to transparency and international standards, its officials say such worries are unfounded. Yet, in private, Western financial executives operating in Dubai remain on guard about accepting potentially dirty funds. “There is money here from questionable sources, which is very tempting,” says one executive whose firm recently opened in the centre. “We haven't turned down money yet, but I expect it will happen. We have to know our investors.”
The questions of image and security go wider. Expatriate circles gossip about how the ruling family tries to protect the emirate from threats like that of al-Qaeda. One line of defence is an elaborate intelligence network. Another is strict immigration controls. Migrant labour is a sensitive issue. “The entire economy is run on the backs of migrant workers,” claims Hadi Ghaemi of Human Rights Watch. More than 80% of workers in the United Arab Emirates' private sector are migrants. Despite a series of protests against low pay and poor working conditions, the government has taken little action. Trade unions and strikes are banned. Human Rights Watch found that 34 site-related deaths of construction workers were reported to the Dubai government in 2004, but Mr Ghaemi says it counted 880 dead bodies sent home by foreign embassies the same year. “They can't explain the deaths,” he adds.
As in other city states with firm controls, Dubai also keeps a grip on the media. Journalists exercise self-censorship, steering clear of stories critical of the ruling family or anything that might damage the economy. Even Skype, the free internet-phone service, is banned in order to protect the local telecoms provider. It remains to be seen whether such restrictions will continue as the UAE inches toward democracy—it will hold limited elections for the legislature in the coming week.
So far, the flush of new wealth and relatively good quality of life have trumped such issues in the minds of foreign investors. Expatriates worry aloud more about spiralling inflation and grinding traffic jams. If inflation continues unabated, the UAE “faces the danger of pricing itself out of the low end of the processing market in banking and insurance,” says Mr Booker.
There is a recognition that if tiny Dubai can succeed as a money giant, it will be tied closely to its role as a gateway to the Gulf, much as Hong Kong is a gateway to China. Yet it is not the first place to dream of becoming a Middle Eastern financial hub. Beirut filled that role until war wrecked its economy in the 1980s and investors shifted toward the Gulf. Bahrain, Qatar and Kuwait have all since found their niches. Abu Dhabi, a rival next door with its own financial ambitions is now trying to become a place for the arts. It has signed a deal to build the world's biggest Guggenheim museum and is in talks to build an offshoot of the Louvre as well.
One obstacle for other countries in the region is the life they offer foreigners. Many are seen as relatively strict and dull places to live. But Dubai is not. “We're living in an Islamic ocean and we're a tiny common-law island,” says Sandy Shipton, an expatriate executive at the Dubai financial centre.
One country with a particular bearing in Dubai is Saudi Arabia. So far, its conservative culture and restrictive religious practices have led many international firms to try to serve the country from regional offices in Dubai; other executives who work there park their families in Dubai and fly back at weekends. But the Saudis are becoming more demanding: they now require a business licence and a Saudi office for foreign firms doing business in their country. Work has also started on a new commercial hub called King Abdullah City, near Jeddah, that will target global firms.
Despite all the jockeying for the attention of international financiers, some see the emergence of several financial hubs in the Middle East as a healthy sign. Indeed, one possibility is the growth of various centres of excellence. “The new reality is you can have a very capable network,” says Ms Sassen. “It's not simply a winner-take-all situation.” She cites Singapore's ties with the Chinese city of Shenzhen as an example of regional collaboration.
Executives at the Dubai financial centre see the parallels with Asia and increasingly promote it as a complement to places like Singapore, rather than a competitor for them. The Omani oil-futures contract, for instance, was chosen as a benchmark for the new Dubai commodities exchange in part because the contract is used by oil traders in Singapore.
Dubai has spent a fortune and done virtually everything within its power to establish an attractive market. In the end, though, successful financial centres cannot be created by government fiat. Success now depends on forces that are largely beyond its control.
More info @ http://www.economist.com/finance/displaystory.cfm?story_id=8422344
Waikiki Gem Museum
Pacific Business News (Honolulu) writes:
A large collection of precious gems collected in Afghanistan will go on display to the public Tuesday at a Waikiki gem museum.
The collection of 60,000 gems valued from $2 to $100,000 is the work of gem collector Gary Bowersox, owner of The Gem Museum/Store at the Waikiki Galleria Office Towers.
The museum has been open by appointment only. Construction will be completed on the store in the next couple of months, Bowersox said. "Once completed visitors will come into a bullet-proof entranceway and enter a theater where different gem hunters from various countries will give lectures and talks on their experiences, knowledge and adventures," he said.
Next week, Mir Waees Khan Jegdalek, a ruby miner from the Jegdalek, Afghanistan, ruby mines, will lecture on Afghanistan and its gems. In addition to Bowersox, future lecture programs will feature Karla Brom Proud of Oregon, Guy Clutterback of Zambia, Sabir Rasool of Pakistan, Ilhom Narzier of Tajikistan and Ron Ringsrud of Colombia.
More info @ http://www.bizjournals.com/pacific/stories/2006/08/28/daily67.html?from_rss=1
A large collection of precious gems collected in Afghanistan will go on display to the public Tuesday at a Waikiki gem museum.
The collection of 60,000 gems valued from $2 to $100,000 is the work of gem collector Gary Bowersox, owner of The Gem Museum/Store at the Waikiki Galleria Office Towers.
The museum has been open by appointment only. Construction will be completed on the store in the next couple of months, Bowersox said. "Once completed visitors will come into a bullet-proof entranceway and enter a theater where different gem hunters from various countries will give lectures and talks on their experiences, knowledge and adventures," he said.
Next week, Mir Waees Khan Jegdalek, a ruby miner from the Jegdalek, Afghanistan, ruby mines, will lecture on Afghanistan and its gems. In addition to Bowersox, future lecture programs will feature Karla Brom Proud of Oregon, Guy Clutterback of Zambia, Sabir Rasool of Pakistan, Ilhom Narzier of Tajikistan and Ron Ringsrud of Colombia.
More info @ http://www.bizjournals.com/pacific/stories/2006/08/28/daily67.html?from_rss=1
India: No.1 Country Of Shopkeepers
Subodh Varma (Times News Network) writes:
You can now tell why the retail boom is about to happen in India. With about 11 retail shops for every 1,000 persons, India has the highest shop density in the world. That's one shop for every 20-25 families. In cities, the density is much higher. Delhi, for example, has nearly 45 shops per thousand persons! Americans, arguably the biggest spenders in the world, have to make do with just about 4 shops per 1,000 persons.
Singapore, the shoppers' paradise, has a similar density. England (rather, UK), once scathingly referred to as the nation of shopkeepers by Napoleon, is only marginally better — it has nearly 5 shops for every 1,000 persons.
According to a study by industry body Ficci, the total retail trade in India was worth Rs 11,00,000 crore in 2003. Of the approximately 12 million retail shops, 96% occupy floor space of less than 500 sq ft. And this is where comparisons with retail powers, like US or Singapore, end. In India, shops are many but they're small. Entry of big retail would consolidate the sector into fewer but bigger shops. The high number of shops in India is because most of them are in the unorganised sector — your local paanwallah, kirana store, subziwallah and so on.
More info @ http://economictimes.indiatimes.com/articleshow/816179.cms
You can now tell why the retail boom is about to happen in India. With about 11 retail shops for every 1,000 persons, India has the highest shop density in the world. That's one shop for every 20-25 families. In cities, the density is much higher. Delhi, for example, has nearly 45 shops per thousand persons! Americans, arguably the biggest spenders in the world, have to make do with just about 4 shops per 1,000 persons.
Singapore, the shoppers' paradise, has a similar density. England (rather, UK), once scathingly referred to as the nation of shopkeepers by Napoleon, is only marginally better — it has nearly 5 shops for every 1,000 persons.
According to a study by industry body Ficci, the total retail trade in India was worth Rs 11,00,000 crore in 2003. Of the approximately 12 million retail shops, 96% occupy floor space of less than 500 sq ft. And this is where comparisons with retail powers, like US or Singapore, end. In India, shops are many but they're small. Entry of big retail would consolidate the sector into fewer but bigger shops. The high number of shops in India is because most of them are in the unorganised sector — your local paanwallah, kirana store, subziwallah and so on.
More info @ http://economictimes.indiatimes.com/articleshow/816179.cms
Saturday, December 16, 2006
Gemstone Treatments
Empresa Brasilera De Radiacoes Ltda, or Embrarad operates in Brazil and is well-known in the gem industry. Embrarad is not a gemstone dealer, but it provides gamma radiation facility for wide variety of industries from pharmaceuticals to plastics to drinking water.
Prasiolite is marketed as green amethyst or green quartz. The color is due to treatment. Other colored gemstones such as oro verde quartz, smoky quartz, blue topaz, dark pink rubellite, blue beryl, and yellow beryl may owe their colors due to irradiation.
Gem dealers from all over Brazil utilize the expertise of Embrarad to produce new colors in order to make money in the gem business. Gemstones are frequently treated by heating, irradiation, diffusion, coating, dyeing or other modified means to make it more desirable and saleable. Each gemstone(s)has its market niche, and as long as the treatment(s)are properly disclosed the stones will find its right place.
Prasiolite is marketed as green amethyst or green quartz. The color is due to treatment. Other colored gemstones such as oro verde quartz, smoky quartz, blue topaz, dark pink rubellite, blue beryl, and yellow beryl may owe their colors due to irradiation.
Gem dealers from all over Brazil utilize the expertise of Embrarad to produce new colors in order to make money in the gem business. Gemstones are frequently treated by heating, irradiation, diffusion, coating, dyeing or other modified means to make it more desirable and saleable. Each gemstone(s)has its market niche, and as long as the treatment(s)are properly disclosed the stones will find its right place.
Friday, December 15, 2006
Weather And Shopping
Idexonline writes:
Weather affects retail sales. No one can quibble with this statement. The problem is that we cannot quantify how much weather actually affects consumer demand for retail goods.
The International Council of Shopping Centers (ICSC) recently attempted to summarize and analyze research conducted over the past several decades relating to the correlation between retail sales and weather.
The ICSC found that retail sales are affected by weather in three ways: 1) direct; 2) indirect; and, 3) timing.
Direct – If a region receives a “seasonal shock” from abnormal weather, it has a direct impact on consumer demand. For example, snow keeps people out of the mall; sales that would have occurred are usually lost. But if it snows early in the pre-Christmas period, it can accelerate holiday shopping.
Indirect – If weather is unseasonably cold, consumers must spend more money to heat their homes, leaving less money to spend on discretionary purchases.
Timing – Sales may be delayed, but not lost, due to certain abnormal weather conditions. For example, if a region has a cool spring, demand for summer clothing will be delayed until the weather becomes seasonally warm.
One of the problems with weather studies is that the impact of abnormal weather cannot be isolated. Instead, weather is inextricably intertwined with other factors. For example, most apparel merchants know that when Easter is early, sales are inherently weaker than when it occurs later in the spring season. The reasoning is that consumers are not ready to buy lightweight clothing until it gets warmer.
That’s the effect of weather, but it is also the impact of seasonality. In other words, researchers cannot reliably separate these two factors.
Climate Cycles Affect Retail Demand
Most merchants know that abnormal weather affects short term sales. But long term demand trends can also be affected by weather.
There is building scientific evidence that an El Nino (or Southern Oscillation), a multi-year cycle of interaction between the atmosphere and the ocean, which produces a large scale abnormal warming in sea surface temperatures, affects consumer demand. El Nino produces warm winters and unusually wet conditions, especially in the west of the U.S. Empirical researchers have shown that U.S. consumer spending tends to be stronger in the early stages of El Nino when temperatures are warming. This may be partly due to less non-discretionary spending on energy and more spending on other discretionary items.
What Does This Mean for Retailers?
While factors that affect consumer spending and the business cycle vary, the common thread throughout all of these cycles is weather. No economic theory is complete without a weather component. Researchers are careful to note that weather is not the sole cause of consumption cycles; rather, they suggest, it is a significant contributing factor.
The problem, though, is that there is no conclusive empirical evidence relating to the impact of weather on retail sales that can be quantified in a nice neat mathematical equation. Said another way, we know weather affects consumption, but we can’t predict precisely how much.
For jewelry merchants and suppliers, the impact of weather varies by geographic region. The U.S. is one of the largest countries in the world, in terms of geographic size. It stretches more than 3,000 miles from east to west. Weather systems are far too diverse to have affect demand on a national basis. However, on a regional basis, weather can affect consumer demand in the U.S.
Seasonal weather variations – For example, jewelers in the southeast were citing warm weather in the fall of 2005 as having a negative impact on jewelry demand, going into the all-important holiday selling season. Cold weather is a catalyst to drive demand for Christmas gifts.
Unusual weather events – One-off events, such as a series of hurricanes along the U.S. Gulf Coast in the fall of 2005 (one of which devastated New Orleans), can have a dramatic affect on consumer demand. Jewelry sales in September were virtually nil along the Gulf Coast. But when the government gave out debit cards loaded with cash for hurricane victims, jewelry sales shot sharply higher. Many jewelers reported that they more than recovered sales that had been lost in September.
ICSC Conclusions
While empirical evidence tying weather to consumer demand remains elusive, the International Council of Shopping Centers has drawn five conclusions from the existing body of research:
1. Weather can cause shifts in the timing of purchases.
2. Weather can cause purchases to be made that might not otherwise occur, or weather can cause a permanent loss of demand.
3. Weather can be responsible for lost or increased economic production – especially in agriculture, construction, and energy. In turn, as consumer wages vary due to weather-induced events, demand will also fluctuate.
4. Weather is one cause of seasonality, and the seasonal cycle is intertwined with the dynamic of business and consumption cycles.
5. To the extent that longer-run weather patterns persist, those influences could result in a non-neutral longer-run impact on business and consumption cycles.
More info @ (4TH, 2006, ISSUE NUMBER 194) www.idexonline.com
Weather affects retail sales. No one can quibble with this statement. The problem is that we cannot quantify how much weather actually affects consumer demand for retail goods.
The International Council of Shopping Centers (ICSC) recently attempted to summarize and analyze research conducted over the past several decades relating to the correlation between retail sales and weather.
The ICSC found that retail sales are affected by weather in three ways: 1) direct; 2) indirect; and, 3) timing.
Direct – If a region receives a “seasonal shock” from abnormal weather, it has a direct impact on consumer demand. For example, snow keeps people out of the mall; sales that would have occurred are usually lost. But if it snows early in the pre-Christmas period, it can accelerate holiday shopping.
Indirect – If weather is unseasonably cold, consumers must spend more money to heat their homes, leaving less money to spend on discretionary purchases.
Timing – Sales may be delayed, but not lost, due to certain abnormal weather conditions. For example, if a region has a cool spring, demand for summer clothing will be delayed until the weather becomes seasonally warm.
One of the problems with weather studies is that the impact of abnormal weather cannot be isolated. Instead, weather is inextricably intertwined with other factors. For example, most apparel merchants know that when Easter is early, sales are inherently weaker than when it occurs later in the spring season. The reasoning is that consumers are not ready to buy lightweight clothing until it gets warmer.
That’s the effect of weather, but it is also the impact of seasonality. In other words, researchers cannot reliably separate these two factors.
Climate Cycles Affect Retail Demand
Most merchants know that abnormal weather affects short term sales. But long term demand trends can also be affected by weather.
There is building scientific evidence that an El Nino (or Southern Oscillation), a multi-year cycle of interaction between the atmosphere and the ocean, which produces a large scale abnormal warming in sea surface temperatures, affects consumer demand. El Nino produces warm winters and unusually wet conditions, especially in the west of the U.S. Empirical researchers have shown that U.S. consumer spending tends to be stronger in the early stages of El Nino when temperatures are warming. This may be partly due to less non-discretionary spending on energy and more spending on other discretionary items.
What Does This Mean for Retailers?
While factors that affect consumer spending and the business cycle vary, the common thread throughout all of these cycles is weather. No economic theory is complete without a weather component. Researchers are careful to note that weather is not the sole cause of consumption cycles; rather, they suggest, it is a significant contributing factor.
The problem, though, is that there is no conclusive empirical evidence relating to the impact of weather on retail sales that can be quantified in a nice neat mathematical equation. Said another way, we know weather affects consumption, but we can’t predict precisely how much.
For jewelry merchants and suppliers, the impact of weather varies by geographic region. The U.S. is one of the largest countries in the world, in terms of geographic size. It stretches more than 3,000 miles from east to west. Weather systems are far too diverse to have affect demand on a national basis. However, on a regional basis, weather can affect consumer demand in the U.S.
Seasonal weather variations – For example, jewelers in the southeast were citing warm weather in the fall of 2005 as having a negative impact on jewelry demand, going into the all-important holiday selling season. Cold weather is a catalyst to drive demand for Christmas gifts.
Unusual weather events – One-off events, such as a series of hurricanes along the U.S. Gulf Coast in the fall of 2005 (one of which devastated New Orleans), can have a dramatic affect on consumer demand. Jewelry sales in September were virtually nil along the Gulf Coast. But when the government gave out debit cards loaded with cash for hurricane victims, jewelry sales shot sharply higher. Many jewelers reported that they more than recovered sales that had been lost in September.
ICSC Conclusions
While empirical evidence tying weather to consumer demand remains elusive, the International Council of Shopping Centers has drawn five conclusions from the existing body of research:
1. Weather can cause shifts in the timing of purchases.
2. Weather can cause purchases to be made that might not otherwise occur, or weather can cause a permanent loss of demand.
3. Weather can be responsible for lost or increased economic production – especially in agriculture, construction, and energy. In turn, as consumer wages vary due to weather-induced events, demand will also fluctuate.
4. Weather is one cause of seasonality, and the seasonal cycle is intertwined with the dynamic of business and consumption cycles.
5. To the extent that longer-run weather patterns persist, those influences could result in a non-neutral longer-run impact on business and consumption cycles.
More info @ (4TH, 2006, ISSUE NUMBER 194) www.idexonline.com
About Baroque Pearls
Beth Braverman writes:
Pearl manufacturers used to throw out baroque pearls because they could find no market for the irregularly shaped iridescent baubles.
Bet they wish they had those castoff pearls back now.
As demand for all pearl jewelry has grown in the past few years, consumers have become more knowledgeable about the pearl-making process and more sophisticated in their tastes.
While a strand of perfectly matched, round white pearls will forever remain a classic, fashion-forward consumers with an appreciation for the natural shapes and sizes of pearls have discovered the beauty of baroques.
As rough-cut stones and hammered gold do, baroque pearls evoke a tactile, natural style that is far bolder than traditional round pearls. Their increased popularity provides a new option for consumers who may have already stocked up on traditional pearl jewelry.
The asymmetrical, organic gems appeal to consumers' quest for individuality because no two pieces of baroque pearl jewelry are exactly the same. And while minimalism may be gaining ground on the fashion front, the best baroque pieces scream for attention, with gumball-size pearls offering opulent adornment.
Heavy on personality, baroque pearl jewelry offers a perfect contrast to the quieter, minimal fashions that are taking hold on the runways.
Fashion-forward designers such as David Yurman, Roberto Coin and Damiani have created baroque pearl jewelry collections, and now more designers are taking note of the growing luxe trend.
A variety of baroque pearl trends in the South Sea, Tahitian, akoya and freshwater categories surfaced at recent trade shows in New York and Las Vegas, in pieces that are surprisingly versatile and have potential to fit into almost any consumer's budget. Prices for baroque pearls tend to remain lower than round pearl prices, but the former continues to increase.
A choker-length strand of large baroque pearls creates a funky, glamorous look that's polished and edgy at the same time, and looks great with a little black dress or a business suit.
Longer strands, measuring a few feet in length, offer a look that's moodier than the flapper look created by their round cousins. Of-the-moment styles incorporate yellow or rose gold chains and colorful gemstones into super-long or bib-style necklaces and multistrand, multicolored pearl bracelets. Such pieces work just as well for dressy attire as they do to glam up a simple T-shirt and jeans ensemble.
Single baroque pearls look great in eye-catching drop earrings or pendants that provide sweet accents to an ethereal dress or a romantic ruffled blouse.
But exceptionally creative designers go a step further, incorporating baroques into the body of an animal or some other charm that plays off the natural shape of the pearl.
More info @ http://www.nationaljewelernetwork.com/njn/content_display/colored_stones/e3i001b3e6344e49e3baa6c1f72531b693c
Pearl manufacturers used to throw out baroque pearls because they could find no market for the irregularly shaped iridescent baubles.
Bet they wish they had those castoff pearls back now.
As demand for all pearl jewelry has grown in the past few years, consumers have become more knowledgeable about the pearl-making process and more sophisticated in their tastes.
While a strand of perfectly matched, round white pearls will forever remain a classic, fashion-forward consumers with an appreciation for the natural shapes and sizes of pearls have discovered the beauty of baroques.
As rough-cut stones and hammered gold do, baroque pearls evoke a tactile, natural style that is far bolder than traditional round pearls. Their increased popularity provides a new option for consumers who may have already stocked up on traditional pearl jewelry.
The asymmetrical, organic gems appeal to consumers' quest for individuality because no two pieces of baroque pearl jewelry are exactly the same. And while minimalism may be gaining ground on the fashion front, the best baroque pieces scream for attention, with gumball-size pearls offering opulent adornment.
Heavy on personality, baroque pearl jewelry offers a perfect contrast to the quieter, minimal fashions that are taking hold on the runways.
Fashion-forward designers such as David Yurman, Roberto Coin and Damiani have created baroque pearl jewelry collections, and now more designers are taking note of the growing luxe trend.
A variety of baroque pearl trends in the South Sea, Tahitian, akoya and freshwater categories surfaced at recent trade shows in New York and Las Vegas, in pieces that are surprisingly versatile and have potential to fit into almost any consumer's budget. Prices for baroque pearls tend to remain lower than round pearl prices, but the former continues to increase.
A choker-length strand of large baroque pearls creates a funky, glamorous look that's polished and edgy at the same time, and looks great with a little black dress or a business suit.
Longer strands, measuring a few feet in length, offer a look that's moodier than the flapper look created by their round cousins. Of-the-moment styles incorporate yellow or rose gold chains and colorful gemstones into super-long or bib-style necklaces and multistrand, multicolored pearl bracelets. Such pieces work just as well for dressy attire as they do to glam up a simple T-shirt and jeans ensemble.
Single baroque pearls look great in eye-catching drop earrings or pendants that provide sweet accents to an ethereal dress or a romantic ruffled blouse.
But exceptionally creative designers go a step further, incorporating baroques into the body of an animal or some other charm that plays off the natural shape of the pearl.
More info @ http://www.nationaljewelernetwork.com/njn/content_display/colored_stones/e3i001b3e6344e49e3baa6c1f72531b693c
Pearl Knowledge
Melissa Shepherd writes:
When American Pearl took its business online nine years ago, e-commerce was virtually uncharted territory. So the pearl importer made its own way, using 50 years of pearl expertise, across two generations, as the jumping-off point.
Now, with about 5 million online visitors and 20 percent sales growth per year, AmericanPearl.com is an established online presence, on a mission to educate its customers about pearls.
The transition from a small showroom in Manhattan's diamond district to the unlimited space of the Web was challenging, says company president Eddie Bakhash, who took over the business in 1990 from his father, Charlie, who founded the company. In the days before jewelry juggernauts like Blue Nile—when Google, Yahoo and Amazon were still start-ups—Bakhash developed the retail model for AmericanPearl.com largely through his own sweat equity.
"One summer I didn't go outside," says Bakhash, a longtime computer whiz, only half-jokingly. For three months, he worked after business hours to build the user-friendly format. Rows of picture icons on the homepage lead to every section of the site in one click, so viewers can quickly navigate what amounts to pages and pages of pearl information and product offerings—from new pieces to bestsellers, to a designer gallery to a collector's section of top-quality pearls.
Educating customers about the value and beauty of pearls is the main goal. The site's buying guide provides information on pearl varieties and pricing, how to identify quality and how to choose pearl size and strand length. There's also a glossary of pearl terms, a brief pearl history and a movie on how cultured pearls are made.
For a tactile business like jewelry, selling online comes down to building trust with consumers. This is particularly true for pearls, says Bakhash, since their quality is much more difficult to assess than diamonds, which have strict grading standards.
"Customers don't have access to the product knowledge, so we give them that resource," he says.
By developing the pearl niche focus, being consistent with customers and keeping pace with the rapid changes of the online marketplace, the site has become a strong brand, says Bakhash. But he admits getting online early was a big advantage. Since the site's launch in 1997, Bakhash has seen customer knowledge of pearls skyrocket, with word-of-mouth recommendations bringing a steady stream of new traffic to the site each month
Because of that success, the company is now expanding to a sister site, AmericanDiamond.com. Up and running but still under development, the site features Gemological Institute of America-certified stones, interactive features such as a build-your-own-ring section and, of course, lots of information on diamonds—all designed to create customer trust.
Whether it's dealing in diamonds or pearls, the company's success, like that of most family businesses, rests on strong relationships. Charlie, who founded the company in 1950 and spent 25 years in Japan building contacts, still goes on all the buying trips—bringing back top quality Japanese akoya and South Sea pearls for some 2,500 retail clients and AmericanPearl.com.
"There is no negotiating quality for us. We sell only the finest," Bakhash says. "When you build a site that's based on the quality of your product, you reach out to all customers."
More info @ http://www.nationaljewelernetwork.com/njn/content_display/colored_stones/e3i001b3e6344e49e3b7f8675ab6cf62f3d
When American Pearl took its business online nine years ago, e-commerce was virtually uncharted territory. So the pearl importer made its own way, using 50 years of pearl expertise, across two generations, as the jumping-off point.
Now, with about 5 million online visitors and 20 percent sales growth per year, AmericanPearl.com is an established online presence, on a mission to educate its customers about pearls.
The transition from a small showroom in Manhattan's diamond district to the unlimited space of the Web was challenging, says company president Eddie Bakhash, who took over the business in 1990 from his father, Charlie, who founded the company. In the days before jewelry juggernauts like Blue Nile—when Google, Yahoo and Amazon were still start-ups—Bakhash developed the retail model for AmericanPearl.com largely through his own sweat equity.
"One summer I didn't go outside," says Bakhash, a longtime computer whiz, only half-jokingly. For three months, he worked after business hours to build the user-friendly format. Rows of picture icons on the homepage lead to every section of the site in one click, so viewers can quickly navigate what amounts to pages and pages of pearl information and product offerings—from new pieces to bestsellers, to a designer gallery to a collector's section of top-quality pearls.
Educating customers about the value and beauty of pearls is the main goal. The site's buying guide provides information on pearl varieties and pricing, how to identify quality and how to choose pearl size and strand length. There's also a glossary of pearl terms, a brief pearl history and a movie on how cultured pearls are made.
For a tactile business like jewelry, selling online comes down to building trust with consumers. This is particularly true for pearls, says Bakhash, since their quality is much more difficult to assess than diamonds, which have strict grading standards.
"Customers don't have access to the product knowledge, so we give them that resource," he says.
By developing the pearl niche focus, being consistent with customers and keeping pace with the rapid changes of the online marketplace, the site has become a strong brand, says Bakhash. But he admits getting online early was a big advantage. Since the site's launch in 1997, Bakhash has seen customer knowledge of pearls skyrocket, with word-of-mouth recommendations bringing a steady stream of new traffic to the site each month
Because of that success, the company is now expanding to a sister site, AmericanDiamond.com. Up and running but still under development, the site features Gemological Institute of America-certified stones, interactive features such as a build-your-own-ring section and, of course, lots of information on diamonds—all designed to create customer trust.
Whether it's dealing in diamonds or pearls, the company's success, like that of most family businesses, rests on strong relationships. Charlie, who founded the company in 1950 and spent 25 years in Japan building contacts, still goes on all the buying trips—bringing back top quality Japanese akoya and South Sea pearls for some 2,500 retail clients and AmericanPearl.com.
"There is no negotiating quality for us. We sell only the finest," Bakhash says. "When you build a site that's based on the quality of your product, you reach out to all customers."
More info @ http://www.nationaljewelernetwork.com/njn/content_display/colored_stones/e3i001b3e6344e49e3b7f8675ab6cf62f3d
Thursday, December 14, 2006
Gems And The Environment
Saleem H. Ali, Ph.D writes:
Research and field work focused on case studies of the three regions that make the strongest material and labor contributions to emerald mining in Brazil; Carnaiba and Socoto of the Pindobacu/Camp Formoso Region in the state of Bahia, Nova Era and Itabira of the Itabira Region in the state of Minas Gerais, and Campos Verdes and Santa Terezinha in the state of Goias produce more than 95% of Brazilian emeralds and virtually all of the best quality emeralds of the nation. The overarching purpose of the investigation was to illuminate the dynamics of emerald production in Brazil with the hope that the emerald economy can eventually play a more important role in local development.
Socio-Economic Conditions
In all three regions, most of the good quality gems are exported before much value is added to them. Only rudimentary markets exist locally to commercialize gems and very little tax is paid to regional governments on gem production. The major portion of emerald mining is done on a small-scale through informal production methods like part-time laborers, sale and donation of waste schist to be washed by families and travelers, “garimpeiros” (Brazilian word for small, independent miners who often work only for themselves) and cooperatives employing workers through informal contracts. Almost all of the people employed to work in the actual mines are men, typically around 25-30 years of age with a low level of education. The populations of mining communities fluctuate seasonally and with unpredictable economic booms and busts. In boom times, a population may rise rapidly creating a higher demand for municipal services. However, investment in public services and formalization of mining operations is rare in part because the mining workforce is so mobile that the population can decline just as rapidly as it rose with news of a boom elsewhere. There is no incentive for governments to invest in emerald production since it does not generate revenue locally. Emerald production does not appear to significantly improve quality of life at the local scale.
Small Emerald Mine Development, Function and Risks
Emerald discovery in Brazil is done the old fashioned way: by finding rough gems on the soil surface of pocket by chance. After discovery, the process of mining begins by digging an open pit that is gradually enlarged as emeralds are removed. Risks of landslides and environmental degradation due to erosion and deforestation increase with the size of the pit. Eventually, miners dig tunnels beneath the pit to search for elusive emeralds. The legal method of tunneling requires technical, geological surveys to determine the position of the emerald vein. The more common, intuitive method used by garimpeiros and small operations is to follow the layer between the overlying schist and the underlying bedrock granite. Tunnels dug in this way are rudimentary and often unstable. No studies are available on the most efficient and safe ways to tunnel. A mixture of schist, soil, granite and other rocks is removed from tunnels and pits for washing so that the emeralds can be seen and removed. Though this process is often done by machines in mines run by large companies, in small mines it is generally done by hand on site or sold to community members and outsiders for washing when probability of finding gems is low. One of the greatest barriers to adding more value to gems before they leave the hands of artisanal and small miners is the difficulty and lack of capacity to assess the value of rough emeralds. Emeralds are notoriously difficult to value before they are cut because of the nature of their impurities. Small miners usually receive only low prices for their gems because they have little knowledge and power in the market.
Case Study: Brazil
Environmental Aspects of Small Emerald Mines
Soil erosion, deforestation, and pollution of water and soil often occur as a result of small-scale emerald mining. These impacts are relatively simple, easy to control, and non-toxic.
Deforestation results from clearing land to mine; erosion results from abandoned mining pits; and pollution is due mainly to washing schist near streams and scattering debris from the schist into soils. Implementation of policies to control these problems has had patchy success for a variety of reasons, including the limited capacity of the mining agency (DNPM), the number of informal (unregistered) mines, pressure from unionized garimpeiros, lack of capital in the small mines, and a lack of cohesion in gem mining policies between different states.
As of 2005, state environmental agencies have begun to crack down on enforcing clean-up policies. The creation of a series of common washing sites for schist buyers in Campos Verdes indicates that municipal government agencies are making some investments toward reducing pollution due to emerald production. An environmental NGO in Campos Verdes has become involved involved in environmental education for small miners and others in the emerald chain.
Concluding Recommendations
Small-scale and artisanal emerald mining is widespread in some of the poorest regions of Brazil and the potential for economic and social development connected to this industry is high. With attention to formalization, organization and learning, there is room to boost job creation, skill building, health conditions, municipal services, and business growth in mining regions while preventing long-term environmental degradation. The following recommendations constitute a starting place from which to potentially improve impacts of emerald production on local development:
•Improve conditions for partnership between small mine owners and investors
•Increase public benefits from emerald production (taxes) for local governments in mining regions
•Formalize mine labor contracts, legalize the profession of garimpeiro, and strengthen mine labor unions
•Provide incentives for voluntary amelioration of environmental degradation due to emerald production
•Create opportunities to add value to emeralds before they leave mining regions
More info @ http://www.uvm.edu/envnr/gemecology/index.html
Research and field work focused on case studies of the three regions that make the strongest material and labor contributions to emerald mining in Brazil; Carnaiba and Socoto of the Pindobacu/Camp Formoso Region in the state of Bahia, Nova Era and Itabira of the Itabira Region in the state of Minas Gerais, and Campos Verdes and Santa Terezinha in the state of Goias produce more than 95% of Brazilian emeralds and virtually all of the best quality emeralds of the nation. The overarching purpose of the investigation was to illuminate the dynamics of emerald production in Brazil with the hope that the emerald economy can eventually play a more important role in local development.
Socio-Economic Conditions
In all three regions, most of the good quality gems are exported before much value is added to them. Only rudimentary markets exist locally to commercialize gems and very little tax is paid to regional governments on gem production. The major portion of emerald mining is done on a small-scale through informal production methods like part-time laborers, sale and donation of waste schist to be washed by families and travelers, “garimpeiros” (Brazilian word for small, independent miners who often work only for themselves) and cooperatives employing workers through informal contracts. Almost all of the people employed to work in the actual mines are men, typically around 25-30 years of age with a low level of education. The populations of mining communities fluctuate seasonally and with unpredictable economic booms and busts. In boom times, a population may rise rapidly creating a higher demand for municipal services. However, investment in public services and formalization of mining operations is rare in part because the mining workforce is so mobile that the population can decline just as rapidly as it rose with news of a boom elsewhere. There is no incentive for governments to invest in emerald production since it does not generate revenue locally. Emerald production does not appear to significantly improve quality of life at the local scale.
Small Emerald Mine Development, Function and Risks
Emerald discovery in Brazil is done the old fashioned way: by finding rough gems on the soil surface of pocket by chance. After discovery, the process of mining begins by digging an open pit that is gradually enlarged as emeralds are removed. Risks of landslides and environmental degradation due to erosion and deforestation increase with the size of the pit. Eventually, miners dig tunnels beneath the pit to search for elusive emeralds. The legal method of tunneling requires technical, geological surveys to determine the position of the emerald vein. The more common, intuitive method used by garimpeiros and small operations is to follow the layer between the overlying schist and the underlying bedrock granite. Tunnels dug in this way are rudimentary and often unstable. No studies are available on the most efficient and safe ways to tunnel. A mixture of schist, soil, granite and other rocks is removed from tunnels and pits for washing so that the emeralds can be seen and removed. Though this process is often done by machines in mines run by large companies, in small mines it is generally done by hand on site or sold to community members and outsiders for washing when probability of finding gems is low. One of the greatest barriers to adding more value to gems before they leave the hands of artisanal and small miners is the difficulty and lack of capacity to assess the value of rough emeralds. Emeralds are notoriously difficult to value before they are cut because of the nature of their impurities. Small miners usually receive only low prices for their gems because they have little knowledge and power in the market.
Case Study: Brazil
Environmental Aspects of Small Emerald Mines
Soil erosion, deforestation, and pollution of water and soil often occur as a result of small-scale emerald mining. These impacts are relatively simple, easy to control, and non-toxic.
Deforestation results from clearing land to mine; erosion results from abandoned mining pits; and pollution is due mainly to washing schist near streams and scattering debris from the schist into soils. Implementation of policies to control these problems has had patchy success for a variety of reasons, including the limited capacity of the mining agency (DNPM), the number of informal (unregistered) mines, pressure from unionized garimpeiros, lack of capital in the small mines, and a lack of cohesion in gem mining policies between different states.
As of 2005, state environmental agencies have begun to crack down on enforcing clean-up policies. The creation of a series of common washing sites for schist buyers in Campos Verdes indicates that municipal government agencies are making some investments toward reducing pollution due to emerald production. An environmental NGO in Campos Verdes has become involved involved in environmental education for small miners and others in the emerald chain.
Concluding Recommendations
Small-scale and artisanal emerald mining is widespread in some of the poorest regions of Brazil and the potential for economic and social development connected to this industry is high. With attention to formalization, organization and learning, there is room to boost job creation, skill building, health conditions, municipal services, and business growth in mining regions while preventing long-term environmental degradation. The following recommendations constitute a starting place from which to potentially improve impacts of emerald production on local development:
•Improve conditions for partnership between small mine owners and investors
•Increase public benefits from emerald production (taxes) for local governments in mining regions
•Formalize mine labor contracts, legalize the profession of garimpeiro, and strengthen mine labor unions
•Provide incentives for voluntary amelioration of environmental degradation due to emerald production
•Create opportunities to add value to emeralds before they leave mining regions
More info @ http://www.uvm.edu/envnr/gemecology/index.html
India: Diamonds + Wedding Season
Sreeradha D Basu & Sutanuka Ghosal (Times News Network) writes:
This wedding season, the going’s been good for branded jewellery players who’ve witnessed a spurt in diamond jewellery sales. With consumers increasingly inclined towards diamond jewellery, major players like Tanishq, Orra and Adora are targeting 24-50% sales growth in this year’s wedding season over last year.
Though none of the branded jewellery companies were willing to share their sales projections for the wedding season in actual quantitative terms, all confirmed that diamond jewellery sales had indeed shown a significant jump. “Gold will continue to be the major player in the Indian jewellery market. But we’ve noticed that more and more people are leaning towards diamonds. During this wedding season, Tanishq is expecting a 40-50% growth compared to the previous year,” CK Venkatraman, chief operating officer, Tanishq told ET.
P Sengupta, manager (East), DTC (Diamond Trading Company), the wedding season accounts for about two-thirds of the total diamond jewellery sales for the year. “We are looking to register a growth of 20-25% in the diamond jewellery sales over last year. In the East, this growth will be up to 30%,” said Mr Sengupta.
Mr Sengupta attributed this marked shift to several reasons, among them the increased stocking of diamond jewellery by retailers and a greater thrust on advertising. This apart, another reason for many brides choosing to include diamond jewellery as part of their trousseau is the perception about diamond jewellery being more trendy, eye-catching and more wearable.
Incidentally, prime movers in the diamond jewellery category are the diamond engagement and wedding rings as well as earrings. However, even the Rs 80,000 to Rs 3 lakh segment is doing well. “We have seen a 62% growth in the above-Rs 75,000 category of diamond wedding jewellery, while overall sales have shown a 46% growth over the previous corresponding period,” said Vijay Jain, CEO, Orra.
Prabir Chatterjee, MD of jewellery brand Adora, said the shift from gold to diamonds was particularly noticeable in the basic jewellery segment.
More info @ http://economictimes.indiatimes.com/articleshow/808517.cms
This wedding season, the going’s been good for branded jewellery players who’ve witnessed a spurt in diamond jewellery sales. With consumers increasingly inclined towards diamond jewellery, major players like Tanishq, Orra and Adora are targeting 24-50% sales growth in this year’s wedding season over last year.
Though none of the branded jewellery companies were willing to share their sales projections for the wedding season in actual quantitative terms, all confirmed that diamond jewellery sales had indeed shown a significant jump. “Gold will continue to be the major player in the Indian jewellery market. But we’ve noticed that more and more people are leaning towards diamonds. During this wedding season, Tanishq is expecting a 40-50% growth compared to the previous year,” CK Venkatraman, chief operating officer, Tanishq told ET.
P Sengupta, manager (East), DTC (Diamond Trading Company), the wedding season accounts for about two-thirds of the total diamond jewellery sales for the year. “We are looking to register a growth of 20-25% in the diamond jewellery sales over last year. In the East, this growth will be up to 30%,” said Mr Sengupta.
Mr Sengupta attributed this marked shift to several reasons, among them the increased stocking of diamond jewellery by retailers and a greater thrust on advertising. This apart, another reason for many brides choosing to include diamond jewellery as part of their trousseau is the perception about diamond jewellery being more trendy, eye-catching and more wearable.
Incidentally, prime movers in the diamond jewellery category are the diamond engagement and wedding rings as well as earrings. However, even the Rs 80,000 to Rs 3 lakh segment is doing well. “We have seen a 62% growth in the above-Rs 75,000 category of diamond wedding jewellery, while overall sales have shown a 46% growth over the previous corresponding period,” said Vijay Jain, CEO, Orra.
Prabir Chatterjee, MD of jewellery brand Adora, said the shift from gold to diamonds was particularly noticeable in the basic jewellery segment.
More info @ http://economictimes.indiatimes.com/articleshow/808517.cms
India: Rise In GDP
Narayan Bhatt (Times News Network) writes:
Global Insight, an international economic and business research firm, has predicted that in 2007 India will post a GDP growth of around 8% even as the global growth rate will decline to 3.3% from 3.9% in 2006.
It expects that the Federal Reserve will cut interest rates three times in 2007 to bring the Federal fund rates down to 4%. This would be good news for the local capital markets as it could lead to more FII inflows. Global Insight also expects oil prices to remain firm and the downward pressure on the US dollar to continue as the US economy will grow by about 2.2%.
These were among the top-10 economic predictions for 2007 made by Global Insight’s chief economist Nariman Behravesh. “India’s growth has also amazed - averaging more than 9% since January, though it should come in around 8% next year. Unlike China, much of India’s growth is consumer-led.
While India’s inflation rate is a little higher than China’s, there are very few signs of overheating in either economy,” says Mr Behravesh in a report. Finance and banking professor at the Indian Institute of Management, Ahmedabad, TT Ram Mohan told ET that India’s GDP could be in excess of 8% due to huge investments being made by the industry.
“The Indian economy can absorb crude oil prices of up to $60 per barrel. The rupee will continue to appreciate against the US dollar in the long-term. Indian exporters have adapted well to the appreciating rupee by cutting down costs further,” says Mr Mohan. A slowdown in the US economy could, in fact, lead to more outsourcing to India.
“Reduction in Fed rates and weakening of dollar would lead to more FII inflows into emerging markets. While some part of it will come to India, the quantum will depend on the valuations prevailing in our equity markets,” says Naresh Kothari, head of institutional equities, Edelweiss Securities.
“Whether the rest of the world has become immune to US cycles (even a mild one) is one of the larger uncertainties about the outlook for next year. Even if the rest of the world follows the US lead, the deceleration worldwide will be relatively mild,” says the Global Insight report.
More info @ http://economictimes.indiatimes.com/articleshow/808986.cms
Global Insight, an international economic and business research firm, has predicted that in 2007 India will post a GDP growth of around 8% even as the global growth rate will decline to 3.3% from 3.9% in 2006.
It expects that the Federal Reserve will cut interest rates three times in 2007 to bring the Federal fund rates down to 4%. This would be good news for the local capital markets as it could lead to more FII inflows. Global Insight also expects oil prices to remain firm and the downward pressure on the US dollar to continue as the US economy will grow by about 2.2%.
These were among the top-10 economic predictions for 2007 made by Global Insight’s chief economist Nariman Behravesh. “India’s growth has also amazed - averaging more than 9% since January, though it should come in around 8% next year. Unlike China, much of India’s growth is consumer-led.
While India’s inflation rate is a little higher than China’s, there are very few signs of overheating in either economy,” says Mr Behravesh in a report. Finance and banking professor at the Indian Institute of Management, Ahmedabad, TT Ram Mohan told ET that India’s GDP could be in excess of 8% due to huge investments being made by the industry.
“The Indian economy can absorb crude oil prices of up to $60 per barrel. The rupee will continue to appreciate against the US dollar in the long-term. Indian exporters have adapted well to the appreciating rupee by cutting down costs further,” says Mr Mohan. A slowdown in the US economy could, in fact, lead to more outsourcing to India.
“Reduction in Fed rates and weakening of dollar would lead to more FII inflows into emerging markets. While some part of it will come to India, the quantum will depend on the valuations prevailing in our equity markets,” says Naresh Kothari, head of institutional equities, Edelweiss Securities.
“Whether the rest of the world has become immune to US cycles (even a mild one) is one of the larger uncertainties about the outlook for next year. Even if the rest of the world follows the US lead, the deceleration worldwide will be relatively mild,” says the Global Insight report.
More info @ http://economictimes.indiatimes.com/articleshow/808986.cms
Madagascar's Mineral Boom
Xan Rice in Ilakaka writes:
In the land with riches underfoot, the poor struggle for a fair cut of the gem bonanza project sponsored by the World Bank is trying to ensure money from sapphire mining benefits local people.
Jean-Noel Andrianasolo has seen the future once before. It was 1998. He was working for an import-export firm in Antananarivo when he heard rumours about extraordinary sapphires being found near Ilakaka, 14 hours' drive south-west of the Madagascan capital.
So he drove there, bought a house, and dug a hole a few hundred metres behind his backyard. He soon found sapphires. The deeper he dug, the more he found. He named the pit "Banque Suisse". "There was so much wealth inside," said the lean, bearded 47-year-old, holding out his hands as evidence. He wore two rings crowned with large sapphires, one deep blue, the other Fanta orange. A third ring, a signet-style band in silver, was topped with nine tiny sapphires, each a different colour.
"All from here," he said.
It is nearly a decade since the start of the Ilakaka sapphire rush, the greatest gem boom in recent world history, and the flow of stones from the sand has never ceased. Each morning tens of thousands of miners, most equipped with little more than a spade, a candle, and belief that this may be their day, head out into the ancient river valleys around Ilakaka. Some disappear down holes so narrow and dark they would please a fox; others sweat in huge tiered sandstone pits such as the Banque Suisse. Given their methods, the product is remarkable: several kilograms of sapphires each day, or about half of the world's supply.
Mr Andrianasolo, a rich man by the standards of a country where nearly three-quarters of the people live below the poverty line, estimates that the greater Ilakaka deposit - at least 120 miles by 80 miles - will keep yielding stones for another century or more. But he is in no hurry to dig them out.
For he has seen the future once more. It still sparkles with gems. But now it also requires knowledge. In a sign of how some in Madagascar are looking to grab a greater share of the international "sapphire split" - the profit in each stone that is shared between the digger, trader, cutter and wholesaler - Ilakaka's most famous resident is going back to school.
Next week he will begin an intensive six-month course in gemology at a World Bank-backed institute in the capital. By June next year he will be able to write "Fellow of the Gemological Association of Great Britain" next to his name. It is costing him $3,000 (£1,500), but he is sure it will be worth it. He will know a decent stone from a great one, and he will be on a par with the foreigners who come into Ilakaka and whisk out the best stones. "It is much better to know," Mr Andrianasolo said.
Few would dispute that the Ilakaka sapphire boom - and smaller but equally frenzied ruby, emerald, tourmaline and gold rushes around the country - have benefited some of the poorest Madagascans in recent years. About half a million people make a living from small-scale mining, and can earn four to five times what they would make from subsistence farming. This is what drew "Mr Rafaly" from his rice plantation in the city of Fianarantsoa to Manombo, nine miles south of Ilakaka. It was late afternoon as he stood alone next to a small pile of moist sand. His mining partner was 10 metres down the hole beside his feet. Every now and then a shout would come up from the inky depths, and Mr Rafaly, 40, would haul up the rope attached to a bucket full of fresh gravel.
"The gravel may contain $100 worth of sapphires, or nothing," he said. "But if I get lucky I will have enough money to plant rice for two years." As he talked, two men walked up the path from the river carrying a large sieve. They had just finished washing their gravel. Bertrand Lava displayed the haul: three small sapphires. Not very valuable stones, either in size or quality, but worth about £10 to the diggers -a good day's work that would benefit several others down the chain.
Typically, a local trader would buy Mr Lava's stones and sell them in the morning market at Ilakaka, where dozens of women in straw hats stand waiting for clients from 6am. On a Sunday morning, pink, blue, yellow and orange stones spilled from small bank bags on to the women's trays. Slender fingers flitted over rough pink sapphires with a touch as light and knowing as a blind person reading Braille. A woman whispered a number, a few notes changed hands, and the stones disappeared into her pocket. The women then hit Ilakaka's main street, where signs such as Mr Yoda's, Mr Woraphat's, Shaolin, Ratnapura, Methra and Virooshi hinted at the provenance of their owners. The hundreds of Thai and Sri Lankan traders here buy the rough stones, and ship them home to be cut.
Sapphires bought locally for $30m to $50m leave the country this way each year. By the time they reach the shops of Europe or North America, their value will have increased several times. And Madagascar will have seen nothing of that latter profit. It is a problem that afflicts much of Africa, which is rich in resources but often lacks the capacity to turn them into finished goods.
"We have the biggest deposit in the world but are not exploiting it properly," said R Nirina, the Madagascan owner of one of the few commercial sapphire mines in the Ilakaka region. Tom Cushman agrees. The unlikely head of the Institute of Gemology, part of a £16m World Bank-sponsored project to stimulate expertise in the local mining industry, arrived in Ilakaka at the same time as Mr Andrianasolo. A straight-talking 52-year-old former gem dealer, he watched Ilakaka grow from a hamlet of seven houses, to a Wild West village where loose talk of a jelly-bean-size sapphire would earn you a bullet in the head, and then to today's sprawling town of several thousand houses, a school, churches, electricity and a clinic - all funded with gem money.
But he also saw how much of the sapphire split was accruing outside the country. With his colleagues at the Institute of Gemology in the capital, he is trying to change that. The institute is running the course Mr Andrianasolo will take, and has already trained more than 300 people as lapidaries. Since the institute opened, several investors have made plans to open cutting factories in Madagascar, Mr Cushman said.
"We don't want to take the foreign traders and cutters out of the deal. But we want to get our guys to compete with them and to keep more of the profits home," he said. "Sometime soon, there's going to be another El Dorado in Madagascar like Ilakaka. We must be ready to take advantage of it."
Backstory
Early French explorers christened Madagascar "Pays des Béryls" after noting the large quantities of semi-precious stones on the island. But it was not until the 1990s that the country's precious stone riches - sapphires, rubies and emeralds - became widely known, sparking frenzied gem rushes all over the country.
Gemologists say that Madagascar's mineral diversity is little surprise if you examine the map of the world 200 million years ago. The island was then part of the Gondwanaland(super continent), with Tanzania to its left, India to its right and Sri Lanka just below - all of which hold some of the earth's richest gem deposits. Aside from mostly unexplored precious gems, there are also reserves of aluminium, titanium and gold.
More info@ http://www.guardian.co.uk/international/story/0,,1963117,00.html
In the land with riches underfoot, the poor struggle for a fair cut of the gem bonanza project sponsored by the World Bank is trying to ensure money from sapphire mining benefits local people.
Jean-Noel Andrianasolo has seen the future once before. It was 1998. He was working for an import-export firm in Antananarivo when he heard rumours about extraordinary sapphires being found near Ilakaka, 14 hours' drive south-west of the Madagascan capital.
So he drove there, bought a house, and dug a hole a few hundred metres behind his backyard. He soon found sapphires. The deeper he dug, the more he found. He named the pit "Banque Suisse". "There was so much wealth inside," said the lean, bearded 47-year-old, holding out his hands as evidence. He wore two rings crowned with large sapphires, one deep blue, the other Fanta orange. A third ring, a signet-style band in silver, was topped with nine tiny sapphires, each a different colour.
"All from here," he said.
It is nearly a decade since the start of the Ilakaka sapphire rush, the greatest gem boom in recent world history, and the flow of stones from the sand has never ceased. Each morning tens of thousands of miners, most equipped with little more than a spade, a candle, and belief that this may be their day, head out into the ancient river valleys around Ilakaka. Some disappear down holes so narrow and dark they would please a fox; others sweat in huge tiered sandstone pits such as the Banque Suisse. Given their methods, the product is remarkable: several kilograms of sapphires each day, or about half of the world's supply.
Mr Andrianasolo, a rich man by the standards of a country where nearly three-quarters of the people live below the poverty line, estimates that the greater Ilakaka deposit - at least 120 miles by 80 miles - will keep yielding stones for another century or more. But he is in no hurry to dig them out.
For he has seen the future once more. It still sparkles with gems. But now it also requires knowledge. In a sign of how some in Madagascar are looking to grab a greater share of the international "sapphire split" - the profit in each stone that is shared between the digger, trader, cutter and wholesaler - Ilakaka's most famous resident is going back to school.
Next week he will begin an intensive six-month course in gemology at a World Bank-backed institute in the capital. By June next year he will be able to write "Fellow of the Gemological Association of Great Britain" next to his name. It is costing him $3,000 (£1,500), but he is sure it will be worth it. He will know a decent stone from a great one, and he will be on a par with the foreigners who come into Ilakaka and whisk out the best stones. "It is much better to know," Mr Andrianasolo said.
Few would dispute that the Ilakaka sapphire boom - and smaller but equally frenzied ruby, emerald, tourmaline and gold rushes around the country - have benefited some of the poorest Madagascans in recent years. About half a million people make a living from small-scale mining, and can earn four to five times what they would make from subsistence farming. This is what drew "Mr Rafaly" from his rice plantation in the city of Fianarantsoa to Manombo, nine miles south of Ilakaka. It was late afternoon as he stood alone next to a small pile of moist sand. His mining partner was 10 metres down the hole beside his feet. Every now and then a shout would come up from the inky depths, and Mr Rafaly, 40, would haul up the rope attached to a bucket full of fresh gravel.
"The gravel may contain $100 worth of sapphires, or nothing," he said. "But if I get lucky I will have enough money to plant rice for two years." As he talked, two men walked up the path from the river carrying a large sieve. They had just finished washing their gravel. Bertrand Lava displayed the haul: three small sapphires. Not very valuable stones, either in size or quality, but worth about £10 to the diggers -a good day's work that would benefit several others down the chain.
Typically, a local trader would buy Mr Lava's stones and sell them in the morning market at Ilakaka, where dozens of women in straw hats stand waiting for clients from 6am. On a Sunday morning, pink, blue, yellow and orange stones spilled from small bank bags on to the women's trays. Slender fingers flitted over rough pink sapphires with a touch as light and knowing as a blind person reading Braille. A woman whispered a number, a few notes changed hands, and the stones disappeared into her pocket. The women then hit Ilakaka's main street, where signs such as Mr Yoda's, Mr Woraphat's, Shaolin, Ratnapura, Methra and Virooshi hinted at the provenance of their owners. The hundreds of Thai and Sri Lankan traders here buy the rough stones, and ship them home to be cut.
Sapphires bought locally for $30m to $50m leave the country this way each year. By the time they reach the shops of Europe or North America, their value will have increased several times. And Madagascar will have seen nothing of that latter profit. It is a problem that afflicts much of Africa, which is rich in resources but often lacks the capacity to turn them into finished goods.
"We have the biggest deposit in the world but are not exploiting it properly," said R Nirina, the Madagascan owner of one of the few commercial sapphire mines in the Ilakaka region. Tom Cushman agrees. The unlikely head of the Institute of Gemology, part of a £16m World Bank-sponsored project to stimulate expertise in the local mining industry, arrived in Ilakaka at the same time as Mr Andrianasolo. A straight-talking 52-year-old former gem dealer, he watched Ilakaka grow from a hamlet of seven houses, to a Wild West village where loose talk of a jelly-bean-size sapphire would earn you a bullet in the head, and then to today's sprawling town of several thousand houses, a school, churches, electricity and a clinic - all funded with gem money.
But he also saw how much of the sapphire split was accruing outside the country. With his colleagues at the Institute of Gemology in the capital, he is trying to change that. The institute is running the course Mr Andrianasolo will take, and has already trained more than 300 people as lapidaries. Since the institute opened, several investors have made plans to open cutting factories in Madagascar, Mr Cushman said.
"We don't want to take the foreign traders and cutters out of the deal. But we want to get our guys to compete with them and to keep more of the profits home," he said. "Sometime soon, there's going to be another El Dorado in Madagascar like Ilakaka. We must be ready to take advantage of it."
Backstory
Early French explorers christened Madagascar "Pays des Béryls" after noting the large quantities of semi-precious stones on the island. But it was not until the 1990s that the country's precious stone riches - sapphires, rubies and emeralds - became widely known, sparking frenzied gem rushes all over the country.
Gemologists say that Madagascar's mineral diversity is little surprise if you examine the map of the world 200 million years ago. The island was then part of the Gondwanaland(super continent), with Tanzania to its left, India to its right and Sri Lanka just below - all of which hold some of the earth's richest gem deposits. Aside from mostly unexplored precious gems, there are also reserves of aluminium, titanium and gold.
More info@ http://www.guardian.co.uk/international/story/0,,1963117,00.html
Pop Quiz On Colored Gemstones
Here is an interesting article that highlights the importance of product knowledge and the ability to interpret difficult-to-understand gemological concepts in simple language.
Emma Johnson writes:
Tips on answering customers' questions
What jeweler hasn't been on the receiving end of a tricky question when it comes to selling colored gemstones? Here is a sales associate's crib sheet that offers savvy responses to those prickly queries.
The diamond industry can pat itself on the back. Thanks to effective marketing, the American public is remarkably well-versed in diamonds: their rarity, the Four Cs, the stone's unique brilliance and more.
The colored gemstone industry is doing a good job getting its product out there, too. Brightly hued stones have been a fashion front-runner in recent years, gracing the pages of major magazines and showcasing themselves via celebrities strutting along red carpets everywhere.
While consumers are certainly demanding colored gemstones in greater quantities, there is still a fair amount of head-scratching when it comes to making an important purchase in this category. Consumers, it seems, are often all too familiar with possible scams, but barely aware of the fascinating and unique qualities of colored stones. The consumer's unease in purchasing such stones can put even the best of sales associates in a pickle: How can they best negotiate an avalanche of questions that put themselves and the industry on the defensive?
"Consumers have heard horror stories about even the best retailers selling synthetics as the real thing," says Antoinette Matlins, gemologist and author of Colored Gemstones: The Antoinette Matlins Buying Guide. "It's important that the retailer has its own policy about which treatments it is willing to carry, and trained salespeople to explain simply and truthfully what the differences in treatments are."
Here are nine common consumer questions gemstone retailers may face, along with some useful responses suggested by industry experts.
Tricky question #1:
I've heard horror stories about synthetic gemstones being passed off as natural. How do I know your product is legit?
Savvy answer:
"When a customer asks 'Is this a natural sapphire?' you'd better hear the question he or she is [really] asking, which is, 'Is it treated?'" Matlins says.
Once that answer is established—except in rare cases, the answer should be "yes"—Matlins advises jewelers to underscore that the practice of heating rubies and sapphires and oiling emeralds has been perfected over centuries.
Doug Hucker, executive director of the American Gem Trade Association (AGTA), says it's critical to first establish that gemstones are "natural"—as in, they come from the earth, as opposed to being laboratory-created.
Hucker says he would candidly tell a customer: "If you're looking for a very important purchase with a ruby, emerald or a sapphire, most of the material is routinely enhanced to make it as attractive as it can be. The unbelievably intense colors are almost always treated."
Jack Seibert, owner of Jack Seibert Goldsmith and Jeweler, in Columbus, Ohio, establishes himself as an authority by telling customers, "With his increasing knowledge, man has the ability to manipulate and enhance that which Mother Nature instigates. You, the consumer, probably can't tell the difference—you need a sophisticated laboratory so you can make this determination. If you doubt the validity of the origin of the stone, you're probably not shopping at a store that distinguishes the difference."
Take the opportunity to educate the customer about other treatments such as oiling of emeralds, beryllium treatments for sapphires, glass-filling and the like. Specify which products are considered acceptable in your store, and which ones you believe undermine the inherent value of a stone.
Tricky question #2:
I want a natural ruby. Why is this so much pricier than those you say are color-treated?
Savvy answer:
Al Molina, owner of Molina Fine Jewelers in Phoenix, has a simple response for customers asking this question: "One word: Rarity." Then he adds, "Untreated natural gemstones are some of the rarest in the world—99.9 percent of material is treated to improve color and quality. A very small percentage of fine stones do not need enhancement."
Tricky question #3:
This is a big purchase for me, and I want to wear my emerald ring every day. Is the stone durable enough for that?
Savvy answer:
Again, this is an excellent opportunity to educate the consumer. Point out that rubies and sapphires are second only to diamonds in hardness on the Mohs scale, and while emeralds are not recommended for everyday wear, proper care and ease of use can make a fine stone last for many generations. Inquire about the wearer's lifestyle, and help the buyer choose an appropriate stone—a process that personalizes the experience and builds trust.
Richard Freeman, owner of E.F. Watermelon Gallery in Old Lyme, Conn., will use any weakness in a stone to strengthen his position as a jeweler.
"Any scratches and abrasions we can take care of, because we have some of the best cutters in the industry," he tells customers.
Tricky question #4:
How do I know which colored gemstones are of better quality than others?
Savvy answer:
The Four Cs is an excellent place to start, as the consumer is probably familiar with those characteristics. Mention, for example, how clarity impacts price, but explain how colored-gem clarity is graded differently than diamond clarity. Elaborate on why color is the most important colored gemstone "C" by showing customers good, better and best color examples. Molina uses six—not four—Cs to describe colored gemstones, adding country of origin and color treatment to his basic explanation of color, cut, clarity and carat weight.
"The country of origin can make a huge difference in the value of an untreated stone versus a treated stone," he says, pointing out that a Burmese ruby can be 10 to 15 times more valuable than a Thai ruby. "One of the things that separates a knowledgeable salesman from a clerk is the ability to talk about these things in a knowledgeable way."
Tricky question #5:
You say that this rich, blue sapphire is the best quality, but I prefer stones in a paler shade. Are such stones still a good investment?
Savvy answer:
Beauty, as the cliché goes, is in the eye of the beholder. And a customer with a product he or she deems beautiful will be a happy customer.
"You have to make it clear that they're the person wearing it and enjoying it, and passing it down," Freeman says. "If they buy strictly to buy, it will never become part of the family structure. You have to explain that if it's special to them, it will become special to their children."
Hucker says it's important to put customers at ease, all the while educating them about the product. He might tell a customer: "Richness in this center stone is what commands the highest price, but many of my customers really prefer this pastel color, and it's more affordable because it's not as rare."
The key, says Hucker, is to make sure the customer is buying with confidence.
"You've got to have the ability not to paint yourself into a corner and [make sure the customer] is not embarrassed to buy a less expensive gemstone," Hucker says.
Tricky question #6:
Why does this 2-carat ruby look so puny when I compare it to a 2-carat diamond?
Savvy answer:
Explaining the physical makeup of a gemstone is a great way to gain trust with the customer. Molina, per usual, cuts to the chase with his suggested model response.
"Very simple," he tells customers. "A sapphire is denser. It's heavier, so it displaces more weight, and therefore gives an appearance that is 20 percent to 25 percent smaller than the diamond."
Matlins offers this opening line for those customers seeking a specific carat weight: "Do you mean a ruby that weighs 2 carats, or did you have a particular size in mind—like the size of a 2-carat diamond?"
Tricky question #7:
You sound so knowledgeable about gemstones. How do I know that I can trust you?
Savvy answer:
Two years ago, AGTA conducted a survey that found that consumers were more willing to buy from jewelers affiliated with an industry association—a phenomenon Molina taps into by supplying many of his customers with a biography touting his education and certifications.
"Tell them the story about the organization," Molina advises. "Then tell them your [personal] story. People want to make sure they can trust you."
Freeman says his vast inventory of high-quality colored stones is often impressive enough to establish him as a colored stone expert.
"People see diamonds everywhere. But if we show them fine tourmalines and fine garnets, it blows their minds," Freeman says.
Tricky question #8:
You say that nearly all sapphires and rubies are heat-treated. Does this affect their hardness and durability?
Savvy answer:
While most experts agree that heated stones are still extremely durable, some feel that consumers need to be warned about special care for those stones that endured excessive heat as part of the treatment process. Seibert points out to customers that the cutting and polishing process is extremely harsh.
"Once a stone has been through the treatment and cutting process, it's going to be a survivor," Seibert tells clients.
But, Matlins warns that jewelers would be wise to protect themselves by educating customers about potentially brittle stones.
"High heat has a significant effect on treated stones, and consumers need to be warned about caring for and wearing them," Matlins says. "The retail trade thinks they've covered this with blanket statements [about durability] on the receipt. I'm just waiting for some consumer to take this issue to court."
Tricky question #9:
On the Internet, I saw a very large ruby with a gorgeous hue. Do you have anything like that for a similar price?
Savvy answer:
This is your moment to shine—not only on your own merits, but on behalf of brick-and-mortar jewelers everywhere. Point out how colors differ from one computer monitor to another. Explain how stones are easily switched in cyberspace. Perhaps most importantly, elaborate on the merits of shopping from a jeweler with a physical storefront, versus one on the Web. Hucker says such propositions are an opportunity for jewelers to showcase the breadth of inventory at their disposal.
"I'd say, 'Certainly I can get a fine ruby for you. What is it about what you saw on the Internet that appeals to you?'" Hucker says.
Seibert suggests putting the very legitimate fear of fraud in the minds of consumers who browsed the Web.
"I'd tell them that the possibility for switching gems is real, as is outright fraud," Seibert says. "And, returning an item purchased on the Internet is almost impossible."
For colored gemstones, the ability to stand behind the product before, during and after the sale helps jewelers stand apart from the pack of online jewelry sellers.
"Brick-and-mortar stores are in business because we can show consumers the product," Seibert says. "They can touch and smell and experience it at all levels. We can romance and sell it to them—at, hopefully, a reasonable price—and stand behind it."
More resources for selling colored gemstones:
* American Gem Society, (702) 255-6500, www.ags.org
* American Gem Trade Association, (800) 972-1162, (214) 742-4367, www.agta.org
* Gemological Institute of America, (800) 421-7250, (760) 603-4000, www.gia.edu
* International Colored Gemstone Association, (212) 620-0900, www.gemstone.org
Editor's Note: This story was first published in the February 1, 2006 issue of National Jeweler.
More info @ http://www.nationaljewelernetwork.com/njn/content_display/colored_stones/e3if692fe1185833976fc989a699b1ef857
Emma Johnson writes:
Tips on answering customers' questions
What jeweler hasn't been on the receiving end of a tricky question when it comes to selling colored gemstones? Here is a sales associate's crib sheet that offers savvy responses to those prickly queries.
The diamond industry can pat itself on the back. Thanks to effective marketing, the American public is remarkably well-versed in diamonds: their rarity, the Four Cs, the stone's unique brilliance and more.
The colored gemstone industry is doing a good job getting its product out there, too. Brightly hued stones have been a fashion front-runner in recent years, gracing the pages of major magazines and showcasing themselves via celebrities strutting along red carpets everywhere.
While consumers are certainly demanding colored gemstones in greater quantities, there is still a fair amount of head-scratching when it comes to making an important purchase in this category. Consumers, it seems, are often all too familiar with possible scams, but barely aware of the fascinating and unique qualities of colored stones. The consumer's unease in purchasing such stones can put even the best of sales associates in a pickle: How can they best negotiate an avalanche of questions that put themselves and the industry on the defensive?
"Consumers have heard horror stories about even the best retailers selling synthetics as the real thing," says Antoinette Matlins, gemologist and author of Colored Gemstones: The Antoinette Matlins Buying Guide. "It's important that the retailer has its own policy about which treatments it is willing to carry, and trained salespeople to explain simply and truthfully what the differences in treatments are."
Here are nine common consumer questions gemstone retailers may face, along with some useful responses suggested by industry experts.
Tricky question #1:
I've heard horror stories about synthetic gemstones being passed off as natural. How do I know your product is legit?
Savvy answer:
"When a customer asks 'Is this a natural sapphire?' you'd better hear the question he or she is [really] asking, which is, 'Is it treated?'" Matlins says.
Once that answer is established—except in rare cases, the answer should be "yes"—Matlins advises jewelers to underscore that the practice of heating rubies and sapphires and oiling emeralds has been perfected over centuries.
Doug Hucker, executive director of the American Gem Trade Association (AGTA), says it's critical to first establish that gemstones are "natural"—as in, they come from the earth, as opposed to being laboratory-created.
Hucker says he would candidly tell a customer: "If you're looking for a very important purchase with a ruby, emerald or a sapphire, most of the material is routinely enhanced to make it as attractive as it can be. The unbelievably intense colors are almost always treated."
Jack Seibert, owner of Jack Seibert Goldsmith and Jeweler, in Columbus, Ohio, establishes himself as an authority by telling customers, "With his increasing knowledge, man has the ability to manipulate and enhance that which Mother Nature instigates. You, the consumer, probably can't tell the difference—you need a sophisticated laboratory so you can make this determination. If you doubt the validity of the origin of the stone, you're probably not shopping at a store that distinguishes the difference."
Take the opportunity to educate the customer about other treatments such as oiling of emeralds, beryllium treatments for sapphires, glass-filling and the like. Specify which products are considered acceptable in your store, and which ones you believe undermine the inherent value of a stone.
Tricky question #2:
I want a natural ruby. Why is this so much pricier than those you say are color-treated?
Savvy answer:
Al Molina, owner of Molina Fine Jewelers in Phoenix, has a simple response for customers asking this question: "One word: Rarity." Then he adds, "Untreated natural gemstones are some of the rarest in the world—99.9 percent of material is treated to improve color and quality. A very small percentage of fine stones do not need enhancement."
Tricky question #3:
This is a big purchase for me, and I want to wear my emerald ring every day. Is the stone durable enough for that?
Savvy answer:
Again, this is an excellent opportunity to educate the consumer. Point out that rubies and sapphires are second only to diamonds in hardness on the Mohs scale, and while emeralds are not recommended for everyday wear, proper care and ease of use can make a fine stone last for many generations. Inquire about the wearer's lifestyle, and help the buyer choose an appropriate stone—a process that personalizes the experience and builds trust.
Richard Freeman, owner of E.F. Watermelon Gallery in Old Lyme, Conn., will use any weakness in a stone to strengthen his position as a jeweler.
"Any scratches and abrasions we can take care of, because we have some of the best cutters in the industry," he tells customers.
Tricky question #4:
How do I know which colored gemstones are of better quality than others?
Savvy answer:
The Four Cs is an excellent place to start, as the consumer is probably familiar with those characteristics. Mention, for example, how clarity impacts price, but explain how colored-gem clarity is graded differently than diamond clarity. Elaborate on why color is the most important colored gemstone "C" by showing customers good, better and best color examples. Molina uses six—not four—Cs to describe colored gemstones, adding country of origin and color treatment to his basic explanation of color, cut, clarity and carat weight.
"The country of origin can make a huge difference in the value of an untreated stone versus a treated stone," he says, pointing out that a Burmese ruby can be 10 to 15 times more valuable than a Thai ruby. "One of the things that separates a knowledgeable salesman from a clerk is the ability to talk about these things in a knowledgeable way."
Tricky question #5:
You say that this rich, blue sapphire is the best quality, but I prefer stones in a paler shade. Are such stones still a good investment?
Savvy answer:
Beauty, as the cliché goes, is in the eye of the beholder. And a customer with a product he or she deems beautiful will be a happy customer.
"You have to make it clear that they're the person wearing it and enjoying it, and passing it down," Freeman says. "If they buy strictly to buy, it will never become part of the family structure. You have to explain that if it's special to them, it will become special to their children."
Hucker says it's important to put customers at ease, all the while educating them about the product. He might tell a customer: "Richness in this center stone is what commands the highest price, but many of my customers really prefer this pastel color, and it's more affordable because it's not as rare."
The key, says Hucker, is to make sure the customer is buying with confidence.
"You've got to have the ability not to paint yourself into a corner and [make sure the customer] is not embarrassed to buy a less expensive gemstone," Hucker says.
Tricky question #6:
Why does this 2-carat ruby look so puny when I compare it to a 2-carat diamond?
Savvy answer:
Explaining the physical makeup of a gemstone is a great way to gain trust with the customer. Molina, per usual, cuts to the chase with his suggested model response.
"Very simple," he tells customers. "A sapphire is denser. It's heavier, so it displaces more weight, and therefore gives an appearance that is 20 percent to 25 percent smaller than the diamond."
Matlins offers this opening line for those customers seeking a specific carat weight: "Do you mean a ruby that weighs 2 carats, or did you have a particular size in mind—like the size of a 2-carat diamond?"
Tricky question #7:
You sound so knowledgeable about gemstones. How do I know that I can trust you?
Savvy answer:
Two years ago, AGTA conducted a survey that found that consumers were more willing to buy from jewelers affiliated with an industry association—a phenomenon Molina taps into by supplying many of his customers with a biography touting his education and certifications.
"Tell them the story about the organization," Molina advises. "Then tell them your [personal] story. People want to make sure they can trust you."
Freeman says his vast inventory of high-quality colored stones is often impressive enough to establish him as a colored stone expert.
"People see diamonds everywhere. But if we show them fine tourmalines and fine garnets, it blows their minds," Freeman says.
Tricky question #8:
You say that nearly all sapphires and rubies are heat-treated. Does this affect their hardness and durability?
Savvy answer:
While most experts agree that heated stones are still extremely durable, some feel that consumers need to be warned about special care for those stones that endured excessive heat as part of the treatment process. Seibert points out to customers that the cutting and polishing process is extremely harsh.
"Once a stone has been through the treatment and cutting process, it's going to be a survivor," Seibert tells clients.
But, Matlins warns that jewelers would be wise to protect themselves by educating customers about potentially brittle stones.
"High heat has a significant effect on treated stones, and consumers need to be warned about caring for and wearing them," Matlins says. "The retail trade thinks they've covered this with blanket statements [about durability] on the receipt. I'm just waiting for some consumer to take this issue to court."
Tricky question #9:
On the Internet, I saw a very large ruby with a gorgeous hue. Do you have anything like that for a similar price?
Savvy answer:
This is your moment to shine—not only on your own merits, but on behalf of brick-and-mortar jewelers everywhere. Point out how colors differ from one computer monitor to another. Explain how stones are easily switched in cyberspace. Perhaps most importantly, elaborate on the merits of shopping from a jeweler with a physical storefront, versus one on the Web. Hucker says such propositions are an opportunity for jewelers to showcase the breadth of inventory at their disposal.
"I'd say, 'Certainly I can get a fine ruby for you. What is it about what you saw on the Internet that appeals to you?'" Hucker says.
Seibert suggests putting the very legitimate fear of fraud in the minds of consumers who browsed the Web.
"I'd tell them that the possibility for switching gems is real, as is outright fraud," Seibert says. "And, returning an item purchased on the Internet is almost impossible."
For colored gemstones, the ability to stand behind the product before, during and after the sale helps jewelers stand apart from the pack of online jewelry sellers.
"Brick-and-mortar stores are in business because we can show consumers the product," Seibert says. "They can touch and smell and experience it at all levels. We can romance and sell it to them—at, hopefully, a reasonable price—and stand behind it."
More resources for selling colored gemstones:
* American Gem Society, (702) 255-6500, www.ags.org
* American Gem Trade Association, (800) 972-1162, (214) 742-4367, www.agta.org
* Gemological Institute of America, (800) 421-7250, (760) 603-4000, www.gia.edu
* International Colored Gemstone Association, (212) 620-0900, www.gemstone.org
Editor's Note: This story was first published in the February 1, 2006 issue of National Jeweler.
More info @ http://www.nationaljewelernetwork.com/njn/content_display/colored_stones/e3if692fe1185833976fc989a699b1ef857
Wednesday, December 13, 2006
Industry Associations Urge FTC To Address Term 'Cultured'
National Jeweler Network writes:
The Jewelers Vigilance Committee (JVC) and 10 other jewelry industry associations have filed a petition with the Federal Trade Commission (FTC) to address the term "cultured" in regards to lab-grown industry products.
The petition asks the FTC to amend the FTC Guidelines for the Jewelry, Precious Metals and Pewter Industries by adding the term "cultured" to the list of terms that are unfair or deceptive to use in conjunction with manufactured jewelry products.
"Given the widespread confusion and misconception found among consumers when asked about the meaning of 'cultured' when applied to products other than pearl, we felt it was important to ask the FTC to amend the guides," Cecilia L. Gardner, JVC's president, CEO and general counsel, said in a statement.
The associations are urging the FTC to pass the proposed amendment for the following reasons: To protect consumers from deceptive or unfair business practices that can occur when the term "cultured" is used in conjunction with jewelry industry products other than pearls; to protect consumers from associating the phrase "cultured diamond" with a natural product or gemstone grown naturally with human intervention; to justify continued consumer confidence in the jewelry industry.
In addition to the JVC, the 10 other associations supporting the amendment are: the American Gem Society, the American Gem Trade Association, CIBJO (The World Jewellery Confederation), the Cultured Pearl Association, the Diamond Council of America, the Diamond Manufacturers and Importers Association of America, the International Diamond Manufacturers Association, Jewelers of America, Manufacturing Jewelers and Suppliers of America and the World Federation of Diamond Bourses.
The staff of the Consumer Enforcement Division of the FTC will consider the contents of the petition, along with consumer survey data indicating widespread confusion in consumers' understanding of the term "cultured" when applied to products other than pearl, before determining if there is sufficient grounds to issue a Federal Register notice.
More info@ http://www.nationaljewelernetwork.com/njn/content_display/independent/e3i2b0523350dd322522c6e7ed7de083c3b
The Jewelers Vigilance Committee (JVC) and 10 other jewelry industry associations have filed a petition with the Federal Trade Commission (FTC) to address the term "cultured" in regards to lab-grown industry products.
The petition asks the FTC to amend the FTC Guidelines for the Jewelry, Precious Metals and Pewter Industries by adding the term "cultured" to the list of terms that are unfair or deceptive to use in conjunction with manufactured jewelry products.
"Given the widespread confusion and misconception found among consumers when asked about the meaning of 'cultured' when applied to products other than pearl, we felt it was important to ask the FTC to amend the guides," Cecilia L. Gardner, JVC's president, CEO and general counsel, said in a statement.
The associations are urging the FTC to pass the proposed amendment for the following reasons: To protect consumers from deceptive or unfair business practices that can occur when the term "cultured" is used in conjunction with jewelry industry products other than pearls; to protect consumers from associating the phrase "cultured diamond" with a natural product or gemstone grown naturally with human intervention; to justify continued consumer confidence in the jewelry industry.
In addition to the JVC, the 10 other associations supporting the amendment are: the American Gem Society, the American Gem Trade Association, CIBJO (The World Jewellery Confederation), the Cultured Pearl Association, the Diamond Council of America, the Diamond Manufacturers and Importers Association of America, the International Diamond Manufacturers Association, Jewelers of America, Manufacturing Jewelers and Suppliers of America and the World Federation of Diamond Bourses.
The staff of the Consumer Enforcement Division of the FTC will consider the contents of the petition, along with consumer survey data indicating widespread confusion in consumers' understanding of the term "cultured" when applied to products other than pearl, before determining if there is sufficient grounds to issue a Federal Register notice.
More info@ http://www.nationaljewelernetwork.com/njn/content_display/independent/e3i2b0523350dd322522c6e7ed7de083c3b
Survey: 'Blood Diamond' Movie Has Minor Impact On Consumer Behavior
JCK writes:
The Jewelry Consumer Opinion Council, a division of MVI Marketing Ltd., recently did a study to measure the impact of “Blood Diamond” on the jewelry industry.
Preliminary polling of more than 2,900 JCOC consumer panel members reveals 11 percent of movie-goers saw the Blood Diamond movie on its debut weekend. Of those respondents who saw it, 50 percent considered it very good, and 31 percent believe it is a possible Academy Award winner. More than two-thirds of those who watched were impressed with Leonardo DiCaprio’s performance.
Among those JCOC panelist who saw the Blood Diamond movie this past weekend, nearly 60 percent indicated it did not affect their opinion of the diamond industry and 64 percent understand that the diamond industry has safeguards in place to prevent the sale of conflict diamonds in the consumer market.
Two-thirds of the respondents believe this movie will not have an impact on their willingness to purchase diamond jewelry. Nearly three-quarters of those who saw the movie say their Holiday diamond jewelry purchasing plans will not be affected by seeing this film.
More info @ http://www.jckonline.com/article/CA6399212.html
The Jewelry Consumer Opinion Council, a division of MVI Marketing Ltd., recently did a study to measure the impact of “Blood Diamond” on the jewelry industry.
Preliminary polling of more than 2,900 JCOC consumer panel members reveals 11 percent of movie-goers saw the Blood Diamond movie on its debut weekend. Of those respondents who saw it, 50 percent considered it very good, and 31 percent believe it is a possible Academy Award winner. More than two-thirds of those who watched were impressed with Leonardo DiCaprio’s performance.
Among those JCOC panelist who saw the Blood Diamond movie this past weekend, nearly 60 percent indicated it did not affect their opinion of the diamond industry and 64 percent understand that the diamond industry has safeguards in place to prevent the sale of conflict diamonds in the consumer market.
Two-thirds of the respondents believe this movie will not have an impact on their willingness to purchase diamond jewelry. Nearly three-quarters of those who saw the movie say their Holiday diamond jewelry purchasing plans will not be affected by seeing this film.
More info @ http://www.jckonline.com/article/CA6399212.html
Diamonds Are A Watch Retailer's Best Friend...If You Know What You Are Selling
Keith W. Strandberg writes:
Diamond watches are a certified Top Wesselton phenomenon in the watch industry. Many companies claim to have been the first to put diamonds onto a steel watch, but there's no denying that just about every watch company has followed in the same footsteps down the road to financial success.
As a result, watch retailers all over the world either have to get on board the diamond watch train or lose out on sales. If your customers can't find what they want in your store, they will go somewhere else to buy.
How do you know what's good quality in diamond watches and what's not? If you aren't a jeweller, chances are you don't know too much about diamonds, so here's a simple explanation that should help you spot the difference between a quality diamond watch and one of lesser quality.
Diamonds on watches
Diamonds are not just a trend anymore; they are a category all unto themselves. Some watch companies have been doing diamonds, and jewelled watches in general, for most of their history, while many other brands are new to the diamond game because diamonds are so hot. The bottom line is that, in women's watches, watches with diamonds sell faster and better than the same watches without diamonds.
Men are starting to buy some watches with diamond enhancements, though the watch completely covered with diamonds for men is still the exception rather than the norm. Rappers, hip-hop artists and other trendy male cel-ebrities are helping to fuel diamonds for men. Wearing ‘blinged’ watches in music videos, on the cover of music and lifestyle magazines and more has certainly upped the visibility, and acceptance, of diamond watches for men.
Eye candy
The way a diamond looks is a big indicator of its quality. If the diamonds sparkle and reflect light back, looking bright and white, the diamonds are probably pretty good.
If the watches you carry in your store are designed for the bling factor, customers prob-ably won't get too worried about the carat weight and the quality of the stones. If the watch is covered in diamonds, makes a statement, the diamonds look good and they love it, they'll buy it. Some of the diamond watches on the market are quite reasonable in price - just don't expect the highest quality diamonds.
When you are considering carrying a diamond watch line, or adding diamond watches to the selection you have now, you have to know enough to ask the right questions.
There is an internationally accepted grading system for diamonds. Jerry Ehrenwald, G.G., A.S.A., President and CEO of the International Gemological Institute (IGI) explains. "With one internationally accepted system for diamond grading, there is a means for everyone to understand the quality of the diamond they are considering purchasing," he says. "In order to know where a particular diamond is on this system, a certificate from an independent laboratory like IGI is required. Here at the Institute, we certify a diamond by issuing a document called the Diamond Grading Report.
"There are the 4Cs of diamonds: the carat weight (objective), the cut (shape, proportion, etc. - somewhat subjective), colour (D, E and F means the diamond is colourless and G, H, I and J near colourless - subjective) and clarity," he continues. "The grades for clarity are: FL is flawless, IF is internally flawless, VVS 1 and 2 are very very small inclusions, not visible to the naked eye, VS 1 and 2 very small inclusions, again not visible to the naked eye, SI 1, slight inclusions, not visible to the naked eye, and SI 2, slight inclusions sometimes visible to the naked eye, depending on the cut, I 1, I 2 and I 3 for imperfect, visible to the naked eye."
According to Ehrenwald, a retailer who is selling diamond watches is supposed to tell the customer the diamond grade if they are able to. If they are not able to declare the quality, then customers can ask for an independent grading report from a credible laboratory using the internationally accepted system for diamond grading.
If you are going to retail diamond watches, you should be able to tell your customers the kinds of diamonds used on those watches. The problem is that most diamonds used on watches are small and sometimes may not even be graded at all. These diamonds are called melee, which are under 0.22 carat down to 0.0025 carat. Like other diamonds, melee diamonds can be either full cut (58 facets) or single cut (16 facets) and cover the range in quality. The cost of these melee diamonds ranges from relatively inexpensive, for poorly cut, poor quality stones, to very expens-ive for the best stones. For the poorest quality melee diamonds, the setting of the diamonds can cost more than the stones themselves.
"There are a lot of bad diamonds out there on watches," admits Fred Cuellar, President/CEO, Diamond Cutters International. "If you are going for high quality, ask for full cut, VS, F or G and say that you want matched, calibrated diamonds. Matched means that all the little diamonds have the exact same diameter."
If you want the highest quality diamonds on the watches you sell, be prepared to pay more. "Better quality diamonds are going to cost more money," says IGI's Ehrenwald. "Anything in the SI 1 quality or better is good for a watch, because the consumer can't see the quality imperfections with their eyes."
If you don't want to have to worry about the quality of the diamonds, you should carry the best brands that sell diamond watches - brands like Chopard, Cartier, Jaeger-LeCoultre, Girard-Perregaux, Piaget and others. "If you focus on the prestige brands, then you can be sure the quality of the diamonds is good," advises Darrell Ross, CEO, President, Ross-Simons Jewellers (East Coast, USA). "There is a price to pay, but you are getting the brand and the assurance they are good diamonds. If you go into the non-prestige brands, they can run the gamut from good diamonds down to not so good diamonds."
The choosing of the diamonds and the setting on the watch are two other important factors when it comes to diamonds on watches. Some companies expend a great deal of effort to get matching stones (colour and size) and the setting of these stones is an art form unto itself. Most high-end watch brands do a combination of CNC preparation and hand-setting, while some special watches are completely hand-set. On the low-end, most watches are completely machine set.
"If you look at the diamonds alone, it's important to know the total carat weight of the diamonds on the watch," says Raphaël Bertschy, Product Development Director, Zenith. "The importance with small diamonds is to have a lot of diamonds and have a visual impact. We choose only diamonds that are VVS1. There are a few ways of setting - you can do it completely by hand, which is the most expensive way, or you can mix - the holes in the case are prepared by CNC machine and you set and finish by hand. Completely machine-set is usually for cheaper brands and it's mainly done in Asia."
Chopard, which sets more than two million stones a year, hand-sets all their watches. "We are a modern manufacture but we use old-world craftsmanship when we set the diamonds - the brain, the eyes and the hands are the most important," says Mathias Hug, Sales Representative and Graduate Gemmologist for Chopard. "The diamonds are all hand-set and they make sure that everything is aligned so that the diamond is 'tights and stocking proof' - it's extremely hard to do that."
Diamond watches: not an investment
You have to be careful when selling a diamond watch, because your customers shouldn't look at buying a diamond watch as an investment. Unlike a diamond ring with a beautiful stone, which will most likely hold its value, the diamonds on watches have little value apart from the watch as a whole. It would probably cost more to take the diamonds off a watch than they would be worth on the resale market. A diamond watch is an emotional purchase, not a hedge against inflation.
The worth of diamonds on a watch for most people is that it makes the watch sparkle and shine and the watch makes a statement on the wrist of the person who is wearing it.
On the high-end, a diamond watch from a prestige brand will marry high quality diamonds with the best in watchmaking and the artistry of stonesetting.
The customer is always right
Buying a diamond watch is a personal choice. You have to ask your customers what they want from a diamond watch - do they just want the bling factor or do they care about the quality of the diamonds? Some of your customers will just want a watch that shines and a less expensive watch with lower quality diamonds may be perfect for that customer. It may be worthwhile to have a lesser quality diamond watch to compare to the higher quality watches - making it easier to up-sell the client.
Diamond watches are a solid segment in watches, not just a trend that comes and goes. Watch retailers who learn about diamond watches and can sell them knowledgably will have an advantage in the marketplace. If you aren't already pushing diamond watches, you should be.
Source: Europa Star October-November 2006 Magazine Issue
More info @ http://europastar.com/europastar/magazine/article_display.jsp?vnu_content_id=1003439235&imw=Y
Diamond watches are a certified Top Wesselton phenomenon in the watch industry. Many companies claim to have been the first to put diamonds onto a steel watch, but there's no denying that just about every watch company has followed in the same footsteps down the road to financial success.
As a result, watch retailers all over the world either have to get on board the diamond watch train or lose out on sales. If your customers can't find what they want in your store, they will go somewhere else to buy.
How do you know what's good quality in diamond watches and what's not? If you aren't a jeweller, chances are you don't know too much about diamonds, so here's a simple explanation that should help you spot the difference between a quality diamond watch and one of lesser quality.
Diamonds on watches
Diamonds are not just a trend anymore; they are a category all unto themselves. Some watch companies have been doing diamonds, and jewelled watches in general, for most of their history, while many other brands are new to the diamond game because diamonds are so hot. The bottom line is that, in women's watches, watches with diamonds sell faster and better than the same watches without diamonds.
Men are starting to buy some watches with diamond enhancements, though the watch completely covered with diamonds for men is still the exception rather than the norm. Rappers, hip-hop artists and other trendy male cel-ebrities are helping to fuel diamonds for men. Wearing ‘blinged’ watches in music videos, on the cover of music and lifestyle magazines and more has certainly upped the visibility, and acceptance, of diamond watches for men.
Eye candy
The way a diamond looks is a big indicator of its quality. If the diamonds sparkle and reflect light back, looking bright and white, the diamonds are probably pretty good.
If the watches you carry in your store are designed for the bling factor, customers prob-ably won't get too worried about the carat weight and the quality of the stones. If the watch is covered in diamonds, makes a statement, the diamonds look good and they love it, they'll buy it. Some of the diamond watches on the market are quite reasonable in price - just don't expect the highest quality diamonds.
When you are considering carrying a diamond watch line, or adding diamond watches to the selection you have now, you have to know enough to ask the right questions.
There is an internationally accepted grading system for diamonds. Jerry Ehrenwald, G.G., A.S.A., President and CEO of the International Gemological Institute (IGI) explains. "With one internationally accepted system for diamond grading, there is a means for everyone to understand the quality of the diamond they are considering purchasing," he says. "In order to know where a particular diamond is on this system, a certificate from an independent laboratory like IGI is required. Here at the Institute, we certify a diamond by issuing a document called the Diamond Grading Report.
"There are the 4Cs of diamonds: the carat weight (objective), the cut (shape, proportion, etc. - somewhat subjective), colour (D, E and F means the diamond is colourless and G, H, I and J near colourless - subjective) and clarity," he continues. "The grades for clarity are: FL is flawless, IF is internally flawless, VVS 1 and 2 are very very small inclusions, not visible to the naked eye, VS 1 and 2 very small inclusions, again not visible to the naked eye, SI 1, slight inclusions, not visible to the naked eye, and SI 2, slight inclusions sometimes visible to the naked eye, depending on the cut, I 1, I 2 and I 3 for imperfect, visible to the naked eye."
According to Ehrenwald, a retailer who is selling diamond watches is supposed to tell the customer the diamond grade if they are able to. If they are not able to declare the quality, then customers can ask for an independent grading report from a credible laboratory using the internationally accepted system for diamond grading.
If you are going to retail diamond watches, you should be able to tell your customers the kinds of diamonds used on those watches. The problem is that most diamonds used on watches are small and sometimes may not even be graded at all. These diamonds are called melee, which are under 0.22 carat down to 0.0025 carat. Like other diamonds, melee diamonds can be either full cut (58 facets) or single cut (16 facets) and cover the range in quality. The cost of these melee diamonds ranges from relatively inexpensive, for poorly cut, poor quality stones, to very expens-ive for the best stones. For the poorest quality melee diamonds, the setting of the diamonds can cost more than the stones themselves.
"There are a lot of bad diamonds out there on watches," admits Fred Cuellar, President/CEO, Diamond Cutters International. "If you are going for high quality, ask for full cut, VS, F or G and say that you want matched, calibrated diamonds. Matched means that all the little diamonds have the exact same diameter."
If you want the highest quality diamonds on the watches you sell, be prepared to pay more. "Better quality diamonds are going to cost more money," says IGI's Ehrenwald. "Anything in the SI 1 quality or better is good for a watch, because the consumer can't see the quality imperfections with their eyes."
If you don't want to have to worry about the quality of the diamonds, you should carry the best brands that sell diamond watches - brands like Chopard, Cartier, Jaeger-LeCoultre, Girard-Perregaux, Piaget and others. "If you focus on the prestige brands, then you can be sure the quality of the diamonds is good," advises Darrell Ross, CEO, President, Ross-Simons Jewellers (East Coast, USA). "There is a price to pay, but you are getting the brand and the assurance they are good diamonds. If you go into the non-prestige brands, they can run the gamut from good diamonds down to not so good diamonds."
The choosing of the diamonds and the setting on the watch are two other important factors when it comes to diamonds on watches. Some companies expend a great deal of effort to get matching stones (colour and size) and the setting of these stones is an art form unto itself. Most high-end watch brands do a combination of CNC preparation and hand-setting, while some special watches are completely hand-set. On the low-end, most watches are completely machine set.
"If you look at the diamonds alone, it's important to know the total carat weight of the diamonds on the watch," says Raphaël Bertschy, Product Development Director, Zenith. "The importance with small diamonds is to have a lot of diamonds and have a visual impact. We choose only diamonds that are VVS1. There are a few ways of setting - you can do it completely by hand, which is the most expensive way, or you can mix - the holes in the case are prepared by CNC machine and you set and finish by hand. Completely machine-set is usually for cheaper brands and it's mainly done in Asia."
Chopard, which sets more than two million stones a year, hand-sets all their watches. "We are a modern manufacture but we use old-world craftsmanship when we set the diamonds - the brain, the eyes and the hands are the most important," says Mathias Hug, Sales Representative and Graduate Gemmologist for Chopard. "The diamonds are all hand-set and they make sure that everything is aligned so that the diamond is 'tights and stocking proof' - it's extremely hard to do that."
Diamond watches: not an investment
You have to be careful when selling a diamond watch, because your customers shouldn't look at buying a diamond watch as an investment. Unlike a diamond ring with a beautiful stone, which will most likely hold its value, the diamonds on watches have little value apart from the watch as a whole. It would probably cost more to take the diamonds off a watch than they would be worth on the resale market. A diamond watch is an emotional purchase, not a hedge against inflation.
The worth of diamonds on a watch for most people is that it makes the watch sparkle and shine and the watch makes a statement on the wrist of the person who is wearing it.
On the high-end, a diamond watch from a prestige brand will marry high quality diamonds with the best in watchmaking and the artistry of stonesetting.
The customer is always right
Buying a diamond watch is a personal choice. You have to ask your customers what they want from a diamond watch - do they just want the bling factor or do they care about the quality of the diamonds? Some of your customers will just want a watch that shines and a less expensive watch with lower quality diamonds may be perfect for that customer. It may be worthwhile to have a lesser quality diamond watch to compare to the higher quality watches - making it easier to up-sell the client.
Diamond watches are a solid segment in watches, not just a trend that comes and goes. Watch retailers who learn about diamond watches and can sell them knowledgably will have an advantage in the marketplace. If you aren't already pushing diamond watches, you should be.
Source: Europa Star October-November 2006 Magazine Issue
More info @ http://europastar.com/europastar/magazine/article_display.jsp?vnu_content_id=1003439235&imw=Y
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