Sotheby's auctions blue diamond for a lot of green
A Sotheby's employee displays the The Premier Blue, Brilliant-Cut Internally Flawless Fancy Vivid Blue Diamond on September 9, 2013 in London, England. The 7.59-Carat stone will be offered for auction in Hong Kong at their Magnificent Jewels and Jadeite sale on October 7, 2013 where it is expected to raise US$19 million.
The Premier Blue is the world’s largest round blue diamond. And it’s up for auction at Sotheby's In Hong Kong this morning. It’s expected to fetch more than $19 million dollars.
So, who spends that kind of money on a diamond? After all, that could buy you 53 Rolls Royces or a massage every day for 547 years. Rob Bates, senior editor of JCK, Jewelry Industry News, says there are three groups of buyers, first are those who hope to become sellers.
“You have dealers -- people who are going to sell these diamonds and make a long term investment,” Bates says.
Next there are the collectors -- people who just love pink and blue diamonds.
And finally, there are people who buy them in financially volatile times. Like In the classic film “Auntie Mame.” When the Great Depression hits, one of the characters, Vera Charles is glad she invested in jewels. “And everyone always said I was such a fool -- spending all my money at Tiffanys,” she says.
But just how conservative an investment are diamonds? Paul Swinand, an equity analyst with Morningstar, says the diamond industry is one of smoke and marketing.
“Diamonds are only worth something if you can get somebody else to buy them from you. Other than an industrial process they don’t really serve much purpose.”
But they sure do look good.