De Beers profits fall 92% | Hacker News Reader

De Beers profits fall 92%

ft.com

This reminds me of a joke I heard a (scarily) long time ago: "You bring De Beers, let's have apartheid."

Apart from their unparalleled success in protecting an artificially scarce market for so many years, did you know that De Beers were the early geniuses in product placement? Diamonds didn't use to be such a big deal. The romantic association of diamonds with love and commitment (primarily for women) was a marketing invention of De Beers. One way they did it was by paying to insert scenes involving diamonds into Hollywood movies (in the 1940s, IIRC), such as the heroine's friends telling her: "He gave you a ring without a diamond? The cad!" Diamonds started popping up in climactic scenes of reconciliation and inevitable marriage proposals.

I can't remember how I know this... it might have been in an old episode of This American Life. The other thing that surprised me was that they were a British company, not a South African one.

I have to say, anything bad happening to De Beers is music to my ears. As you've mentioned they run a cartel to sell worthless rocks at huge markups to irrational consumers, but my real problem comes from the toll their actions take on human lives in third world countries. The human rights violations of the diamond industry are unparalleled.

I'd recommend everyone read up on "blood diamonds" or "conflict diamonds" as well as the diamond market in general before ever purchasing a diamond for jewelry.

Hey! Diamonds aren't worthless! One can make knives/scalpels/drills/… out of them!

Diamonds are superb materials and are used every day in industrial processes all over the world. None of these are gem quality nor does anybody give a rat's arse about their diamond paste or diamond cutting wheel being pretty.

I'd recommend everyone read up on "blood diamonds" or "conflict diamonds" as well as the diamond market in general before ever purchasing a diamond for jewelry.

I'm guessing most hackers aren't diamond buyers. I recommend everyone read this before buying any computers or electronic gadgets: http://www.johannhari.com/archive/article.php?id=863

Why is it so inaccurate? "Coltan is a metal that conducts heat unusually brilliantly." compare to wikipedia: "Coltan is the colloquial African name for columbite - tantalite, a metallic ore from which the elements niobium and tantalum are extracted." Also in wikipedia: "The United States Geological Survey reports in its 2006 yearbook that the Democratic Republic of the Congo produces a little less than 1% of the world's tantalum." - so this implying of guilt for everyone buying electronics is rather silly.

He trades truth for rhetorics undermining all the sympathy I might have.

submarine PR/marketing at its best

Another simply awful British company on the back foot at the moment over human rights violations due to the mining of a precious mineral is Vedanta. They bought a mountain and planned to demolish it in the search for Bauxite, despite the fact it is the ancestral home and most sacred place for the Dongria Kondh tribe. Luckily Survival International have been on the case from the start and this Monday a rep from the DK will be arriving in London to protest at Vedanta's AGM.

http://www.survival-international.org/news/4783

check them out - probably my favourite charity of all time

Can't feel too badly for these guys, they've been capitalizing on market inefficiency (the bad kind, anti-competitive actions) for decades. For anyone interested in the diamond industry, this Wired story from 2003 provides some great insight into the cartel: http://www.wired.com/wired/archive/11.09/diamond.html

This article is also very good:

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

Wow, and written in 1982. Thanks for that.

Ever since I read that article, maybe 10 years ago, I've been wondering "If that's all true then why is it taking so long?"

The author of that article actually wrote essentially a book on the matter, which is available online for free: http://www.edwardjayepstein.com/diamond/prologue.htm

Wow, selling rocks with no actual value is no longer profitable? Who would have thunk it! (This is like the Web 1.0 version of those "things" you can buy your friends on Facebook. No actual value, they're just a row in the database, but marketing and artificial scarcity makes people want to buy them. It doesn't last, though, once people realize that your worthless shit is worthless.)

I first read that as 'Beer profits fall 92%' and was slightly worried.

(I know you're picky about houmorous comments here, but please don't vote me down to -8)

I wouldn't be surprised if beer sales increase in a recession as people stay home and drink more beer yet at a lesser overall cost than if they went out and drank half as much in a restaurant or bar.

Not just buying them. I know of two different IT people (in two continents no less) who finally have the time to build their own little basement brewery :-)

There is something about programmers and DIY foods and beverages. A good friend of mine also became an "urban farmer".

Bottom line: De Beers spent lots of money on 2 mines in Canada and now has $1.5bn in debt, while demand for diamonds are at an all time low.

...registration required to read...

nah, just change false.html to true.html and chop off the redirect, like this:

http://www.ft.com/cms/s/0/89c46692-782e-11de-bb06-00144feabd...

One of the worst registration process I have had to go through. And you wonder why Newspapers are so f!@#^&ed. Their article is not even well written!

Clever little hack to get by the registration!

I paid for a year's subscription to the FT back when I had time in the mornings to sit and read it. Nice and relaxing but I realized I got most of my news via google reader anyway so knew most of the headlines before I opened it.

Anyway I canceled my subscription. That was about a year and a half ago. I still get a copy, every morning, without fail on my doorstep.

You should tell them you're "on vacation" from now until forever. Saves paper and keeps you from having to bother with disposing of it.

The problem with registration news sites--they don't own the underlying news.

A nag-free copy of the same information: http://www.livemint.com/2009/07/24122026/De-Beers-H1-net-pro...

Creative destruction at its finest.

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