aside from being the hardest known material on earth, and aesthetically beutiful, why are diamonds so vauable?

Question

I only just fit that question in the question space by the way!

Answer 1

This is one of those classic economics issues that was first spoken about in Smith. The issue is why water was cheaper than diamonds, but water is so useful and diamonds less so (and certainly less in 1776 when Smith wrote).

The solution is that 'use' or what we call demand, is not the total determinant of price. Perhaps this is obvious, perhaps not. Many people also use this example to say that price is reflected on the margin, but Smith did not have anything to do with marginal analysis.

Answer 2

Diamonds are plentiful....however, only 1 or 2 companies control ALL of the diamond production and sale in the world. DeBeers in Antwerp controls almost 90% of all diamonds and their prices.

The price is kept artificially high by using the old trick of "supply and demand". To keep the demand high (and thus, the prices), DeBeers and others have tight control on the supply.

Read the following website for a real eye opener. Diamonds should be as cheap as any other gemstone...

http://www.theatlantic.com/doc/198202/diamond

Answer 3

As with everything, it is the law of supply and demand. If there is less supply than demand at a lower price -- the value will rise. If there is more supply than demand at a price point -- the value will fall.

In the case of diamonds, they are a bit rare, and there is a large demand in both industrial diamonds and in commercial diamonds that it causes prices to rise to a point where not as many people will desire to part with such a large amount of money.

Industrial diamonds are used in industry for such things as diamond drill bits and diamond edged saws.

Commerical diamonds are those things you see on fingers, ear lobes, and around necks of beautiful women.

Answer 4

cause they are rare and useful for cutting hard objects and drilling into thing.

I only just fit that question in the question space by the way! - what do you mean

Answer 5

Because of their popularity and because they are known to belong to people that hold social standing. Daimonds are simply every woman's desire, that's why they are so valuable, people will never get sick of daimonds. They also represent love, and are very romantic.

Answer 6

i dont know. im not a big jewelry person and i'd rather have a tattoo personally but did you see that blood diamonds movie? really makes you think. i'll never buy a diamond.

Answer 7

beacuse they last forever lol an i want all of them!! lol supply an demand... then try to make money. so since they are so expensive all the rich people want them so the cycle never ends
i know i want a few large ones!!! ;)

Answer 8

because it reminds people of the armless kids in Sierra Leone. I'm black. The world hates dark skin for some reason.

Answer 9

They are only valuable because we are told they are. Who says there worth X amount? I wouldnt give a carrot for them.

Answer 10

they are rare and only come from South Africa. They are the only industry that is a monopoly.