Myths and Reality of Precious Stones and Diamonds

In today’s market, precious stones like the diamond, ruby, sapphire, and emerald command a premium price due to their color, brilliance, and rarity. A common mistake often made by buyers of genuine colored gemstones is the belief that some stones are precious and some stones are only semi-precious. While precious stones are obviously more famous, this does not necessarily mean that they are more valuable. Let’s try to sort out the myths and misconceptions from the actual realities about gems.

One of the most common misconceptions is that the list of precious stones is comprised of only the diamond, sapphire, ruby, and emeralds, as they are obviously the most famous. However there is a surprising list of other gems that belong in the precious gems category. Surprisingly, the pearl which is not a gemstone, is still considered to be precious; and as is the opal. The amethyst was changed from precious to semi-precious after large deposits were found in Brazil and Uruguay. Amethysts were actually the first gemstone to ever be called semi-precious gemstones, and date all the way back to 1858.


Although many believe that the diamond is the rarest of the precious stones, it actually is a myth. Before the 20th century, the ruby and sapphire were actually more valuable than the diamond, because they are actually rarer. Today the diamond tops the chart of precious gems. How did this happen?

After the discovery in 1870 of the South African diamond mines, diamonds were being mined by the ton. There was an abundant supply and very little demand for diamonds, which caused the financiers of the mines to be in grave danger of losing their entire investment. Their solution was to create a cartel that limits and controls the supply of diamonds, famously known today as De Beers. Believe it or not quality diamonds are not rare at all! In order to maintain the high demand and high price, De Beers controls the flow and supply of diamonds which creates the illusion that they are a rare commodity.

Part of De Beers’ brilliant marketing plan was the creation of the slogan “Diamonds are forever.” Just a couple of hundred years ago the diamond was never used as a symbol of love; today it is considered an important part of the ritual of marriage.

In today’s market place “semi-precious” stones like alexandrite, garnet and Tanzanite can command a similar value to the ruby and sapphire. It is fair to say that we have reached the point that there is almost no distinction in value between semi-precious and precious stones. The U.S. Federal Trade Commission has actually considered banning the use of the terms semi-precious and precious because it causes confusion. Many centuries ago a precious gemstone’s value was assessed largely on the rarity and brilliance of the gemstone. However in the rapidly moving technology-based world, factors like marketing and monopolizing the market place play a huge role in a gemstone’s value.

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