What has happened to colored gemstones?

[Edward Bristol]

All,

I was explaining the gem market to a friend in investment banking and came up with this visualization.

Looking forward to hear your feed-back and discuss input.

 

[chrono]

As far as I can tell, the simplistic and general view is this.

No new or good strikes in recent years but who knows what could be around the corner.
Mining of good quality gems are dwindling (compared to earlier mining efforts), whilst demand continues to rise.
More invasive or undisclosed treatment to make the lower quality gems look nicer.

 

[Lady_Disdain]

I disagree that before 1900, all gems were exclusive to royalty and the church. Just off the top of my head (sorry, I can't do some proper research right now), the jewelry mass market really took off in the mid 19th century, including quite a lot of garnet and other lower end stones. That would be the equivalent of today's "maul jewelry".

Before that, I distinctively remember Jane and Cassandra Austen getting citrine crosses from their brother. Napoleon gave Josephine a diamond and sapphire ring and, at that time, he was a just a military man in the beginning of a promising career. In Moll Flanders, a banker and a sea captain both have diamond rings and the protagonist finds a small diamond ring left on a window sill by the road (yes, I love this book and its realistic portrayal of life).

In the Late Middle Ages, gemstones had to specifically forbidden to those outside the aristocracy (note that the aristocracy is able to wear gemstones legally, so not only royalty), indicating that, yes, there was gemstone jewelry being worn by rich merchants to the point where nobility felt threatened.

These are all just examples and hastily written, but you get the picture. There was gemstone jewelry in other layers of society, not just royalty and the Church. At the very least, the nobility can be included without much argument, which would increase by several hundred times the number of gemstone wearers. The upper middle class, civil servants, merchants, etc also had access and even, depending on time and place, the middle class itself. Was all of this top quality stuff? Of course not but neither is most of today's jewelry.

If you are going to include treatment, synthetics, etc, I think you should also consider the use of paste jewelry, which is much older and was quite acceptable. The French court of Louis XV wore a lot of paste and even Queen Elizabeth I wore fake pearls (as well as natural pearls, like Coco Chanel).

Also, modern methods allow a much greater amount of rough to be mined, contributed to over supply. Better geographical knowledge has led to identification more mines and made others more accessible. Travel and transport is also much easier and faster. Technology also makes cutting the stones faster and better. Can you imagine cutting a stone in a Medieval workshop, with few, heavily barred windows for security? So, a good quality diamond in the 17th century probably came from India, by land and sea over months of travel, and was cut by hand in a dark workshop. Today, we can get South African diamonds that were air freighted to Antwerp or Israel, machine cut to precise specification. That has a huge impact on price and availability too.

 

[Edward Bristol]

Thanks, Chrono, yes very simplistic, and no data is available. I just wanted to show my friend how the market has split up. It is a rather unique occurrence. I can't think of anything similar ever.

LadyDisdain:
True, I hesitated to use a term like 'ruling class' or so, but probably some cheaper gems were available for upper middle class or merchants after 1500AD. I have been reading a lot of Tolstoi lately and the peasants don't seem to have many gems.... But even in central Europe I think gemstones were not within reach for 90% of society. Today EVERYBODY, even a poor Chinese farmer, can afford some gemstone.

Yes, I was not taking diamonds into consideration. I think that is another topic.

Mining has increased, yes, but in colored gemstones (diamonds again excluded), the mining has remained artisan, fractured and little improved by technology. Most mining countries have seen to that with laws on mining.

In Sri Lanka for example there has been zero change in the last 2 millennia. Still the same people working the rivers, a few more perhaps, but nothing significant.

I think compared to the increase that treatment has brought to supply the increase in mining is negligible.

 

[Edward Bristol]

P.S. our diesel-run water pumps are the only new technology that I have seen in Sri Lanka in 30 years, and even those are NOT increasing out-put but only help the fishes in the rivers.

 

[lawnmower79]

If your friend is a finance guy, then you might want to look at a few topics relating to microeconomics that are very relevant when it comes to coloured gemstones (I'm a finance guy myself).

1. Information asymmetry - one side (eg. trader) knows more than the other side (eg. buyer)

2. Veblen Goods - raising the price of a Veblen good actually INCREASES the demand for it (eg. very rare gemstones)

3. Giffen Goods - the opposite of Veblen goods - lowering the price of a Giffen good actually DECREASES the demand for it (eg. cheaper gemstones).

When you throw in these factors, the gemstone market becomes a bit more complicated and these can explain the shape of your graphs a bit better.

Hope this helps.

 

[Edward Bristol]

L,

Thanks, yes, I showed him your post and we discussed those. Of course we would have to go 3D and spend a few years researching to capture them in a chart.

He is setting up a 'crowd-fund' for untreated gems. It was my idea but I am already stretched too thin.

 

[ephsea]

What is this "crowd fund" for untreated gems you speak of, Ed? We're all very interested in untreated stuff here, could you elaborate please?

 

[Marlow]

by ephsea » 30 Jul 2014 08:27
What is this "crowd fund" for untreated gems you speak of, Ed? We're all very interested in untreated stuff here, could you elaborate please?

----

"Collecting" money to invest in gems, vendors etcetera - so in the future we will pay much more for our gems....

But this is o.k., isn't it????

 

[LoversKites]

What is this "crowd fund" for untreated gems you speak of, Ed? We're all very interested in untreated stuff here, could you elaborate please?

+1 I'm curious too

 

[Edward Bristol]

Uhm, ah, I can't, not allowed, sorry.

 

[cm366]

Maybe keep an eye on crowd-funding platforms, like Kickstarter or Indiegogo? There have been a couple of gem related projects on both, but I'm not sure any have made their goals....

 

[eastjavaman]

He is getting a major fund in. Lets hope that we get some trickle of $$$ our ways from Ed when he succeed.