(De Beers are still the big baddies though)
Also, there is a deep body of economics and psychology literature describing how individual spending decisions are sometimes suboptimal in predictable ways, particularly that we under-value experiential purchases.
It doesn't contradict general "live and let live" principles to think that cultural emphasis on positional goods is bad, nor that individuals might be better off if they made different consumption choices.
If you just finished your college, sit on a big pile of student loans, work in your first job and then spend several months of income on a shiny rock, then that is a bad financial decision, no matter whether you love diamond rings or not. (And from what I hear, this situation happens a lot, due to social pressure and "desired social status".)
Going into unaffordable debt for a trinket is a story of beautiful romance to you? That's just profoundly sad.
Externality exists. The 40K$ diamond ring goes to some of the worse people in our society.